Extended Climate Change Agreement Scheme 2025

Review upcoming changes to the UK's Climate Change Agreement (CCA) Scheme for 2025.

Our previous article published in April 2023 on this topic highlighted the possible changes and new requirements for the Extended CCA Scheme, which is accessible in the following link: Climate Change Agreement - CCA Re-opens for Applicants

This article will review the main points of the published “New” Extended UK CCA Scheme.

What is the CCA Scheme?

The Climate Change Agreement (CCA) scheme is a voluntary scheme that encourages businesses across multiple industrial sectors (53 to date) to become more energy efficient and in turn, reduce their carbon emissions. In return, the participants get a reduction from the Climate Change Levy (CCL), found on companies’ energy invoices.

The previous CCA scheme ended on 31 December 2024 (Target Period 6) with the reduced Climate Change Levy Rates (CCL) available originally until 31 March 2027.This date has been extended to 30 June 2027 to be in sync with the new scheme’s certification period.

The consultation on the possible new scheme was held between November 2023 to February 2024 and the result of that the previous administration aimed to create a 6-year-long CCA scheme.

This has been reaffirmed and the decision on the extension of the scheme was published in October 2024 by the Department for Energy Security and Net Zero (DESNZ), with the target periods running to 31 December 2030, which will allow access to the reduced rates of CCL until 31 March 2033.

Main points of the “New” Extended CCA Scheme

• The scheme will be running between 1 January 2026 to 31 December 2030.
• Contains 3 Target Periods (TP):
  • TP1: 1 January 2026 - 31 December 2026
  • TP2: 1 January 2027 - 31December 2028
  • TP3: 1 January 2029 - 31 December 2030
• If all the reporting requirements for the three (3) Target Periods are completed the participant will be guaranteed to receive discounted CCL levy until June 2033.
• The initial application window to join the scheme will be opened between 1 May 2025 to August 2025.
• New entrants can join the scheme between 1 January to 31 August each year starting from 2026.
• No changes in the CCA application process.
• Existing participants are expected to be transferred to the new scheme subject to eligibility re-confirmation. The exact details of the re-confirmation process will be announced in Summer 2025.
• 2022 has been announced as the new base year for the scheme.
• Mandatory annual self-certification of the 70/30 threshold.
• The reporting will move to the facility level. “Bubbled “Target Units (TU) are not going to be enabled. Mandatory annual reporting on energy usage and emission data at the end of year one of a two- year Target period (TP2 and TP3) towards the sectors.
• Unified target to all sectors (methodology and type of unified target has not been announced yet).
• Self-generated electricity will be counted as zero for emissions.
• Buy-out cost will remain at the £25/tCO2e level in the first (1st) reporting period (TP1).
• The surplus can be carried forward between Target Periods in the new scheme but not from the previous CCA scheme (TP6)

How can NUS Help?

NUS’ Energy and Sustainability Services (ESS) team can support you with the CCA scheme in the following areas:

• Advice for legislation affecting new CCA schemes, discounts applicable, or the reporting requirement.
• Assistance for application/transfer into the new “extended” CCA Scheme.
• Assistance with any data collection/provision and reporting exercises requested from the sectors.
• Review data and provide forecast reports for awareness of year-end position against targets.
• Monitor information to identify any significant changes in data to discuss causes and agree to any action required.
• Ongoing generation of all PP10 and PP11 documentation to ensure correct application of supplier discounts.
• Maintain all energy invoices and production data for inclusion within the required evidence pack.

If you are interested in discussing NUS Support, please get in touch with your NUS consultant, or contact contact@nusconsulting.com and we can provide further information on the full scope of assistance in the CCA Scheme.