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Climate Change Agreement Blog

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The BPF Climate Change Blog provides members with the latest news and information on the Climate Change Agreement.

5th August 2009

To date 227 sites have reistered for the British Plastics Federation Climate Change Agreement, the closing date for admission is 31st October 2009, if this deadline is missed the next entry date for the CCA will not be until 2011.  

22nd July 2009

BPF Climate Change Agreement Receives Royal Assent
On 22nd July 2009 Royal Assent was given to the Finance Act 2009 which contains the clause enabling the British Plastics Federation (BPF) Climate Change Agreement (CCA) to come into force.

BPF Director General, Peter Davis says "This is a significant step forward for the BPF's CCA and we now seriously urge all eligible companies to begin the registration process as soon as possible so as to ensure they start saving from the earliest possible opportunity".

The BPF CCA has the potential to save the UK plastics industry over £50 million per annum in climate change levy payments until the year 2017. Companies with a qualifying site can obtain a discount of up to 80% on the Climate Change Levy (CCL) they pay on electricity and LPG.

If companies start the application process now they may benefit from the discount from 1st October 2009. The absolute cut-off for DECC accepting completed CCA Applications for the current scheme year is 31 October 2009 and if companies miss this deadline then the next entry point to the scheme will be 1 April 2011.

To find out more information on CCA eligibility or begin the registration process please visit www.bpfenergy.co.uk 

18th May 2009

The following is a communication which the BPF has sent to its members explaining the current status of the BPF's forthcoming Climate Change Agreement. It emphasises the need for companies to register their interest immediately to avoid 'missing the boat'.

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Dear Member

You will be aware that the Budget opened the door to the BPF to enter into a Climate Change Agreement with the Secretary of State for Energy and Climate Change. The timing for implementation remains slightly uncertain since it is dependent on the point at which the Finance bill receives the Royal Assent. However all signs indicate that the Agreement will be in place in the Autumn of 2009 and that eligible companies will be able to receive the 80% rebate on their Climate Change Levy payable on electricity and LPG purchases from that point.

Companies wanting to participate in the Agreement, which will embrace all processes except extrusion, should act now as they will have to have applied for admission into the scheme and be accepted by September 30th 2009. There will be limited capacity in UK government to process applications hence you are strongly advised to register your interest by emailing climatechange@bpf.co.uk This email will go to the BPF’s scheme administrators, Inenco, and will also be copied to the BPF which will be monitoring uptake of the scheme by the industry .

The full scheme details are currently being worked out by the BPF and will be finalised shortly. However you can take this first step now and we cannot emphasise strongly enough the need for companies to act immediately. If you are not sure if your company is eligible ask for clarification on you email to climatechange@bpf.co.uk. The exclusion of extrusion might not necessarily mean that your company is ineligible if the extrusion is part of a larger manufacturing situation with other connected processes. Compounding and recycling activities involving melt processing are intended to be covered by the scheme.

 

 

28 March 2009

The Budget (March 21st) opened the door for a limited CCA for plastics processing based on electricity and LPG consumption only.This means that companies will be able to secure an 80% rebate on the levy raised on energy purchases from these sources.

The timescale for implementation is dependent on the Finance Bill receiving Royal Assent and a further statutory Instrument being passed which will give live force to a plastics CCA. BPF will then have to sign the Agreement with the Secretary of State for Energy and Climate Change (Ed Miliband).We understand this could all be accomplished by October at which point hopefully companies should start to receive their rebate.

The scope of the Agreement and processes included is below:

"At an installation or site where plastic materials, or plastic products
(whether or not these are finished products), are produced by-
(a) the application of heat and pressure to; or
(b) a chemical reaction involving,plastics powder, granules, shredded waste or liquid: injection moulding, reaction injection moulding, compression moulding (including hot and cold press moulding), ransfer moulding, structural foam moulding, direct screw transfer moulding, rotational moulding (including slush moulding), flexible foam moulding (including dual component processing), blow moulding, casting, expanded polystyrene moulding, expandable materials processing, mixing and compounding, calendering, powder coating (including dip moulding), sintering, thermoforming (including vacuum forming), pultrusion, filament winding, spread coating, hand lay-up and resin transfer moulding."

You will note the absence of extrusion because extruded building products held down the import penetration level below 50% , a key criterion to meet in getting the CCA in the first place.The definition was written very carefully to be as all embracing as possible.

BPF will be setting up a separate company, BPF Energy ,to act as the vehicle for managing the scheme because not all BPF members will be able to avail themselves of the Agreement.

BPF Energy will use Inenco to administer the scheme on its behalf.

Participants in the scheme will pay an annual fee plus a one- off joining fee related to the pre - discount Climate Change Levy for electricity and LPG. The start up and running costs of the scheme are significant.All fees will be paid to BPF Energy who will pay Inenco for their services and reimburse its own costs. A draft schedule of fees exists which is currently being reviewed. BPF will publish the final scale plus a clear statement of what participating companies can expect as support for their fee.

If companies need additional support then they can use any commercial consultancy they wish, including of course Inenco.

The fees for full BPF members will be 50% those of non members. The fees for members of BPF affiliated organisations are likely to be 10% less than those for non members.

It is crucial that companies register as soon as possible since the scheme is likey to close to newcomers at the end of this year.To ensure that there is the capacity to process all necessary paperwork registration needs to happen before the end of September 2009.The first step companies should take is to email their expression of interest to climatechange@bpf.co.uk

Significant costs are already being incurred on behalf of the industry in setting up the scheme.Immense amounts of time has already been invested.We will be invoicing the one- off starting fee to companies within weeks once we have published the scales.

Participation in a Climate Change Agreement could relieve companies of potential obligations under the Carbon Reduction Commitment (CRC).Where 25% or more of the total emissions of an organisation, or a subsidiary of an organisation, are covered by a CCA that organisation, or subsidiary, is temporarily exempt from CRC.

22nd April 2009

The BPF's recent lobbying work has borne fruit in the 2009 Budget. Following BPF communications directly to Chancellor Alistair Darling and BERR Minister Ian Pearson the Budget incorporates the BPF's recommendation that CCA's based on electricity only be introduced. This gives the BPF's attempts to secure a CCA for plastics processing a second chance and the BPF is now in a good position to resume discussions with DECC and the EU.

25th February 2009

We have been advised that Mrs Neelie Kroes, the EU Competition Commissioner, personally considered the case for a plastics processing CCA on 18th February and concluded that there was, as yet, insufficient evidence to warrant an approval.

She has, according to UK government , asked for an investigation of the case under Article 88(2) of the Treaty of Rome. This means that this decision will appear in the Official Journal of the European Communities and views will be invited not only from the UK plastics industry, but also other national plastics industries in the EU and also competing materials' industries. This could take at least six months (some previous cases have lasted up to eighteen months) and will certainly push the final, decision beyond the deadline for completion of Climate Change agreements in the current scheme (this September).

UK government is extremely concerned by this as it has very serious implications for all existing Climate Change Agreements and those yet to be developed. The government tell us that they are urgently considering the implications for CCA's as a whole and plastics processing in particular. They tell us that they are reviewing all the options open to UK government in order to effect an improvement on this situation.

We are pressing this matter very hard indeed and are currently preparing letters to the Chancellor of the Exchequer, Ed Milliband, Secretary of State at DECC, and Ian Pearson who holds Ministerial positions in both the Treasury and BERR, requesting their assistance in resolving this issue.

15th January 2009

A letter providing more detailed information to the European Commission is sent by UK Government’s Department of Energy and Climate Change on January 15th 2009 and the BPF awaits the response.

We estimate the Commission will respond by end of February.

2nd December 2008

The European Commision has sent a letter to UK Government (Department of Energy and Climate Change) seeking further clarification and giving the BPF 20 days to respond. The BPF would expect the Commission to respond to this input by the end of February 2009. We are using all means to accelerate the process.

22nd October 2008

The BPF is currently awaiting the consent of the European Commission to the proposal for a Climate Change Agreement (CCA) for plastics processing.

Whilst the concept has been accepted by the UK Government Department DEFRA the Commission’s Competition Directorate has to give its assent.

As from earlier this year the Commission is obliged to apply ‘new environmental guidelines’ to the assessment of such cases. This has required the Commission to ask detailed questions which the BPF has spent a considerable amount of time responding to.

The last response was sent to the Commission on September 30th 2008 and the Commission has two months in which to respond.

Whilst optimistic the BPF cannot be sure when it will receive the Commission’s agreement, however representative of DEFRA quoted 'the end of November 2008'.

Any updates on this will be posted on this website

For more information or to register interest please email climatechange@bpf.co.uk