The Climate Change Levy (CCL) is a tax on energy supplied to businesses in the UK. While it’s designed to incentivise energy efficiency, the tax can place a significant financial burden on energy-intensive sectors.
However, businesses engaged in certain industrial processes may be eligible for the MinMet CCL exemption. In this article, we’ll explain what the exemption is, who qualifies and how it could help your business unlock valuable savings.
What is the Climate Change Levy (CCL) and why does it matter?
The CCL is a government tax on electricity, gas and other fuels used by non-domestic consumers. It’s aimed at reducing carbon emissions by encouraging energy efficiency. However, for industries that inherently rely on high energy usage, such as metalworking or ceramics, this can be financially challenging.
As a result, to prevent these industries from being unfairly penalised, the government introduced exemptions — most notably the MinMet exemption for metallurgical and mineralogical processes.
What is the MinMet CCL exemption?
Since 1 April 2014, UK businesses that conduct specific metallurgical or mineralogical processes are eligible for exemption from the main rates of the CCL. This exemption helps align UK tax policy with EU rules that allow tax relief for energy-intensive operations.
The exemption was designed to protect UK industries from competitive disadvantage while supporting sectors with high-energy demands.
Who qualifies for the MinMet exemption?
Eligible businesses are those whose operations fall under designated NACE codes for metallurgical and mineralogical activities. Here’s how it breaks down:
Metallurgical processes
- Division 24 – Manufacture of basic metals.
- Group 25.5 – Forging, pressing, stamping, and roll-forming of metal.
- Group 25.6 – Surface treatment and coating of metals; machining.
Examples include smelting, casting, galvanising and refining metals.
Mineralogical processes
- Division DI26 – Manufacture of glass, ceramics, cement, lime and plaster.
Qualifying processes often involve high-temperature furnaces or kilns, such as in glassmaking or ceramics production. These processes, by their nature, require high-energy input and are therefore considered eligible under CCL guidance.
To be eligible, the energy must be used directly in these processes.
What are the benefits of the MinMet exemption?
Businesses that qualify for the exemption can unlock substantial savings, which could prove to be a game-changer for manufacturers operating on tight margins.
In addition, the exemption provides the following benefits:
- Lower energy tax costs.
- Improved competitiveness.
- Stronger cash flow and profit margins.
- More accurate energy cost forecasting.
How to apply
To apply for the exemption, businesses must complete and submit the following forms:
- PP10 – Declaration of qualifying use.
- PP11 – Ongoing usage reporting and verification.
Once completed, these forms must be submitted to your energy supplier and you should maintain your documentation to comply with HMRC regulations. It’s essential that these forms are accurate and up-to-date. Otherwise, incorrect or missing information can delay your claims or result in penalties.
How we can help
- Eligibility assessments – Firstly, we’ll conduct a full review of your operations to determine if your processes meet the necessary criteria.
- Application and documentation support – We’ll assist in filling out and submitting PP10 and PP11 forms, ensuring compliance and avoiding delays.
- Ongoing compliance monitoring – Finally, we’ll help to maintain accurate records and advise you on any regulatory changes that you should be aware of to keep your business compliant in the long-term.
If your business operates in sectors such as metals, ceramics, or construction materials, you could be leaving thousands of pounds on the table by not claiming the MinMet CCL exemption.
Get in touch with us today to schedule a free eligibility consultation and start maximizing your energy savings.
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