Climate Change Agreement

A Climate Change Agreement is a voluntary agreement between the Environment Agency and an energy-intensive industry sector that grants participating operators a discount on the Climate Change Levy in return for meeting agreed energy-efficiency or emissions targets over defined target periods.

CCAs are negotiated at sector level by trade associations — for example by the British Steel Producers, Mineral Products Association, Chemical Industries Association, NFU horticulture sector, and others — and individual operators sign an underlying agreement with their sector body to access the relief.

• The discount is significant on qualifying supply, particularly on electricity.
• The participating site must meet measurement and reporting obligations — typically energy intensity per unit of output, or absolute emissions, against agreed targets.
• Failure to meet targets can result in buy-out payments to retain the discount or loss of CCA status.

Most general commercial businesses do not qualify for any CCA. Eligibility is sector-specific. For sectors where eligibility exists — most notably intensive horticulture under glass — the procurement strategy should be coordinated to ensure the supplier applies the CCA-reduced CCL rate from the first day of contract, not retrospectively.