climate change

International - Earth Summit, Rio & Kyoto protocol

Climate change has been a global concern for a number of decades. The United Nations Framework Convention on Climate Change was agreed at the 1992 Earth Summit meeting in Rio. This has now been signed by around 184 countries. Under the Convention, all developed countries agreed to return their greenhouse gas emissions to 1990 levels by 2000.

The Kyoto protocol was agreed in December 1997. It is designed to build on the commitments made in Rio to further reduce greenhouse gas emissions. Developed countries agreed targets to reduce their emissions of greenhouse gases by 5.2% below 1990 levels over the period 2008-2012.

Europe

The EU is meeting the Kyoto commitments by redistributing the target between member states to reflect their different national circumstances. In June 1998, environment ministers agreed how the target should be shared out. The UK agreed to reduce current emissions by 12.5%, Germany by 21% and Denmark by 6%.

The UK - the Climate Change Levy

The Climate Change Levy is a tax applied to most industrial uses of energy. It was introduced on 1 April 2001 as part of the UK's commitment to the reduction of greenhouse gases.

The Levy rates are:

• 0.15 p/kWh for gas, coal and coke
• 0.43 p/kWh for electricity
• 0.07 p/kWh for LPG

For a typical fuel mix, businesses can expect the Levy to add around 15% to their energy bill. This does not currently directly affect householders, you will not see this Levy added on to home energy bills.

There are some Levy exemptions e.g. energy used by "good quality" combined heat and power systems. An 80% Levy discount is also available for two years by participating in a Climate Change Levy Agreement, which businesses apply to join. On approval of the application, documentation is supplied to pass to utility suppliers, who then subtract the Levy discount.

Application forms and further information on Levy discount schemes can be found on www.cclevy.com Many trade associations have their own climate change Levy agreements for members.