The UK has a commitment
under the Kyoto protocol to achieve a 12.5% reduction in greenhouse
gas emissions to below 1990 levels by 2008 to 2012. The British
Government has set its own domestic goal of 20% reduction by 2010.
The Climate Change Levy is the taxation vehicle chosen by the Government
to help the UK achieve this goal. The objective purpose of the levy
is to encourage energy efficiency in business, agriculture, and
the public sector and to reduce emissions of green house gases from
these sectors.
The Government recognises the case for giving special treatment
to energy intensive sectors because of their high energy costs and
their exposure to international competition. Subject to certain
eligibility requirements the UK semiconductor sector and certain
parts of the electronics sector fall within this arena.
Your company may be eligible to negotiate a reduced rate of Climate
Change Levy (CCL), by participation in the NMI CCL Negotiated Agreement.
Participation will give you up to an 80% reduction in your CCL once
a negotiated energy efficiency target is agreed for your site.
To determine your eligibility you will require to review the types
of process undertaken on your site to ascertain whether you carry
out any of the allowed activities as specified in the IPPC regulations.
Only energy used directly in these specified IPPC processes or in
any directly associated activities will be eligible for a CCL reduction.
If your site does not require IPPC registration because of the volumes
of the chemicals used, you may still be eligible for a CCL reduction.
The amount of CCL reduction is governed by the energy intensity
of the site. If more than 90% of a site’s energy is attributable
to the IPPC registered processes and their directly associated activities,
the full 80% reduction is applicable.
For the majority of the UK microelectronics sector the most relevant
sections of the IPPC regulations are:
Section 4.2 A1 part B – use of hydrogen halides
Section 4.2 A1 part H – use of HF
Section 6.4 A2 – Use of organic solvents
Once into an agreement you must agree with the Government to a
set of binding targets to improve your energy efficiency. Performance
against target will be audited every two years. If a site fails
to meet it’s CCL target, it has the opportunity to purchase
Carbon using the UK Emissions Trading Scheme in order to retain
the rebate.
These agreements are voluntary - participants may drop out at any
time and do not need to re-pay any CCL. Site are required to leave
the agreements if milestone targets are not met and carbon is not
purchased to make up the deficit, however, they would lose the benefit
of the reduced rate of levy.
If you would like to make further enquiries on the CCL Rebate,
please contact
us.
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