ResourcesClimate Change Agreements, in plain English
Guide · Energy & compliance3 min read
Your Climate Change Agreement target is kWh per kg. So is what we capture.
If your site holds a Climate Change Agreement, part of your energy bill already depends on a number most of the business never sees: your specific energy consumption against a target, assessed at the end of each target period. This is what that number is, where it comes from, and what production monitoring can honestly do about it.
Written 3 August 2026. Treat the Environment Agency’s own CCA guidance, and your sector association’s scheme rules, as the authority on eligibility, targets and current rates. This page explains the shape of the scheme so the rest of it makes sense — it is not advice on your obligations, and we are not your CCA scheme administrator or your accountant.
What a Climate Change Agreement actually is
The Climate Change Levy is a tax on the energy a business uses — it’s already on your bill, added by your supplier. A Climate Change Agreement is a scheme that lets energy-intensive sectors trade a significant discount on that levy for a commitment: hit an agreed energy-efficiency target, reassessed at the end of each target period, or pay to make up the shortfall.
Most target periods run for two years, but not all of them do, so check the dates rather than assume them. The current target period and its dates are set out in our news piece, along with what they mean for a site inside one.
The target is a ratio, not a total
The target most sectors are set is a specific energy consumption figure — energy used per unit of output, not a total kWh number. For plastics processors under the British Plastics Federation’s sector agreement, for example, that unit is kWh per kilogram of product made. A site that grows its output is not automatically failing its target; a site whose energy per kilogram creeps up between assessments is.
What happens if you miss it
If a target period is missed, the current mechanism is a buy-out payment per tonne of CO2e shortfall, so a missed target has a stated cost rather than a vague one. The rate is set and published by government and changes — do not quote a figure from this page; check the current published rate before it goes anywhere near a business case.
What per-machine energy data does and does not give you
SmartFactory measures energy at the machine and ties it to the job that ran on it, which is most of the raw material a specific-energy-consumption number needs — kWh, against parts made, per machine, over any period you choose, rather than once a target period from a site-wide bill.
- It does not calculate your CCA target for you, submit anything to the Environment Agency, or know your sector’s scheme rules.
- It does not guarantee you hit your target — a target is missed or made by how the site runs, not by what measures it.
- What it changes is when you find out. A site-wide meter tells you your kWh/kg ratio once, at assessment. Job-level energy against job-level output tells you which machine, which shift, which product is moving that ratio, while there’s still a target period left to do something about it.
What we’d actually suggest
If your site holds a CCA and you want to see what your own kWh/kg would look like measured at the machine rather than estimated from the bill, that’s a conversation for an engineer, not a form. If the next step is a case rather than a conversation, the business case guide is written for the finance director who will read it. Ask an engineer, or ring 0161 475 6291 and say it is a CCA question.