Climate Change Levy Increase Will Put 3% On NI Commercial Gas Prices
DETI Minister Arlene Foster has written to Manufacturing NI to explain that her Department has failed to secure an extension from HMRC to the low rate of Climate Change Levy applied to gas supplies in Northern Ireland over the past 2 years. This will mean that the rate of Climate Change levy paid by Northern Ireland companies will increase from .00064p/kwh to .00182p/kwh.
Northern Ireland was originally ed an exemption for CCL on commercial gas back in 2001 to promote the expansion of the developing gas network. This exemption lasted for ten years until April 2011. At that stage the Department failed in an attempt to have the EU extend the exemption, and as a consequence HMRC introduced CCL to gas supplies in the Province at a reduced rate for a strictly limited period of two years until 31st October 2013. This April the Department approached HMRC with a view to having this reduced rated extended, however HMRC have cited an EC directive which forbids any extension of the reduced rate. Manufacturing NI estimates that this increase will add between 2.5% and 3% to company gas bills dependent on the gas price originally agreed. The CCL increase does not apply to domestic users or electricity generators, so there is unlikely to be any knock on effect on electricity pricing.
MNI Chief Executive Bryan Gray said “The loss of this exemption is a major blow to NI companies who are already struggling with some of the highest electricity prices in Europe. The increase will affect the viability of many existing CHP plants and may well have a negative impact on the feasibility of the proposed gas pipeline to the west of the Province.” Members can hear full details of the proposals at MNI’s Energy forum on 20th September 2013 from 12.00 – 2.00pm in Invest NI headquarters when speakers from DETI and the Gas Regulator will make presentations. BOOK NOW by e mail to firstname.lastname@example.org Some companies who operate a Quality Assessed CHP plant and those with a Climate Change Agreement in Place may qualify for a exemption from the full tax. A summary of exemptions can be found in the attached document.