03/11/2026
Navigating the complexities of energy for organisations can be challenging, but understanding the taxes on your bills is key. Let's clarify two important charges: CCL and VAT.
💡 What is VAT?
Value Added Tax is applied to an organisation's energy bills at a standard rate of 20%. However, certain organisations - such as those with low energy consumption or qualifying charities - may be eligible for a reduced rate of 5%. It's crucial to ensure your organisation is on the most suitable rate to avoid overpaying.
💡 What is CCL?
The Climate Change Levy is a government tax introduced to promote energy efficiency, this tax is charged per kilowatt-hour (kWh) and appears as a separate line item on your bill. If your organisation qualifies for the reduced 5% VAT rate, it is automatically exempt from paying the Climate Change Levy. This is a significant factor in managing your energy costs.
At BP Consulting, we work with organisations to identify opportunities for cost savings and ensure accurate billing. Contact us today to review your energy contracts and make sure you're not paying more than you should be at 0800 989 0141.