Leading the development and monitoring of UK Climate Change Agreements

Leading the development and monitoring of UK Climate Change Agreements

Leading the development and monitoring of UK Climate Change Agreements

Climate Change Agreements (CCAs) are a primary part of the United Kingdom’s (UK) energy and climate change policy, aiming to reduce energy demand across all major energy-intensive industry sectors. CCAs commit participants to meet a series of biennial energy reduction targets in return for a significant discount in the UK’s Climate Change Levy energy tax. Since the scheme’s inception in 1999, Ricardo Energy & Environment has provided technical and policy support to the UK Department of Energy and Climate Change (DECC) on the development, implementation and monitoring of CCAs.

Challenge

This contract requires a detailed appreciation of the issues facing industry and the options and technologies available to achieve energy savings, together with a detailed understanding of the CCAs and how they operate. To date, CCAs cover 51 industry sectors and almost 9,000 industry sites. The success of the CCAs is underpinned by realistic target setting that ensures they incentivise additional action, together with a robust monitoring and audit regime to measure operators’ performance against those targets. 

Delivery

Since the scheme began, Ricardo has supported DECC in developing the structure of the CCAs and negotiating their targets, from strategic policy advice through to resolving day-to-day operational issues. This has included making recommendations on the most appropriate sector and individual CCA targets and providing procedures and tools to collate, assess and analyse participants’ performance. Targets can be absolute or based on specific energy intensity ratios.  Since the scheme started we have carried out around 100 industrial facility audits per year and evaluated each sector’s performance against its biennial targets.  For the second phase, from 2013 to 2023, CCAs are being implemented by the UK Environment Agency and Ricardo Energy & Environment continues to provide target sector facilitation, guidance and audit support.

Results

The UK Government has benefited from our industrial energy efficiency expertise to help ensure that CCAs deliver additional energy savings underpinned by a robust monitoring and audit framework.  The success of the CCAs was demonstrated in the results of the fifth and most recent target period.  A total of 28.5 million tonnes per year of CO2 were saved relative to base years, with the large majority of sectors and facilities meeting their targets. Improvements in energy intensity vary by sector but are typically around 20% over the decade since the scheme started.

Our evaluation report can be found here.