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CRC to be scrapped as part of business energy tax reforms

The government is to abolish the Carbon Reduction Commitment (CRC) in reforms aimed at simplifying the business energy efficiency landscape.

The Treasury’s Budget document said the scheme would be ended following the 2018-19 compliance year, with Climate Change Levy (CCL) rates increased from 2019 in order to cover the shortfall. CCL rates will also be rebalanced; they will move to a ratio of 2.5:1 (electricity:gas) from April 2019, with a view to reaching a ratio of 1:1 rates by 2025.

Existing eligibility criteria for the Climate Change Agreements scheme will remain in place until at least 2023, and from April 2019 the CCL discount available to CCA participants will rise so that they pay no more than an RPI increase.

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