Business Energy Alert: Climate Change Levy Increase from 1 April 2026

From 1 April 2026, UK businesses will see an increase in the Climate Change Levy (CCL) applied to electricity and gas.

The CCL is a government environmental tax designed to encourage energy efficiency and reduce carbon emissions. It applies to most non-domestic energy use and is typically shown as a separate line on energy invoices.

What’s changing?

From April, the main rate for electricity and gas will increase from £0.00775/kWh to £0.00801/kWh — a rise of around 3.4%.

On the face of it, the increase is relatively small. But for businesses with high energy consumption, the impact quickly adds up.

• A site using 10 GWh per year could see an increase of around £2,600+ annually
• A 100 GWh industrial site could see costs rise by £26,000+

The change reflects the government’s approach to up-rate the levy in line with inflation, maintaining the incentive for businesses to improve energy efficiency.

What businesses should be checking…

For many organisations, this is a good opportunity to review how energy policy costs are being managed:

• Whether Climate Change Agreement (CCA) discounts are correctly applied
• That the correct CCL rate is being charged on invoices
• Opportunities to reduce costs through efficiency, onsite generation or demand management

Businesses with a CCA may be eligible for significant discounts, including up to 92% reduction on electricity CCL.

Our view at GLEG…

For large energy users, policy costs already make up a meaningful part of overall energy spend. Changes like this, while small in isolation, can have a noticeable impact over time.

It’s another reminder that energy procurement, compliance and decarbonisation shouldn’t be treated separately. Taking a joined-up approach is key to managing both cost and risk.

If you’d like support reviewing your CCL exposure or ensuring discounts are being applied correctly, contact our team at hello@gleg.co.uk.