{
  "url": "https://openlegislation.uk/climate-change-agreements-administration-regulations-2012/regulation-12",
  "json_url": "https://openlegislation.uk/climate-change-agreements-administration-regulations-2012/regulation-12.json",
  "legislation": "uksi/2012/1976",
  "legislation_title": "The Climate Change Agreements (Administration) Regulations 2012",
  "legislation_url": "https://openlegislation.uk/climate-change-agreements-administration-regulations-2012",
  "path": "regulation/12",
  "kind": "regulation",
  "number": "12",
  "heading": "Terms to be included in an underlying agreement relating to the buy-out fee",
  "text": "(1) An underlying agreement must contain the terms set out in paragraph (2).\n(2) The terms referred to in paragraph (1) are—\n(a) if the administrator finds that a facility has failed to meet its target —\n(i) at any time in the period beginning with 1st May in the year following the end of a target period and ending immediately before the first day of the next certification period; or\n(ii) at any other time,\nthe obligation to make progress towards meeting the target may instead be satisfied by the payment to the administrator of a fee in accordance with sub-paragraph (b);\n(b) if sub-paragraph (a) applies, the administrator must serve a notice on the operator containing the following information—\n(i) that the facility has failed to meet its target;\n(ii) the fee to be paid, calculated in accordance with sub-paragraph (c) or (d);\n(iii) the date by which the fee must be paid, determined in accordance with sub-paragraph (e) or (f);\n(iv) to whom the fee must be paid;\n(v) how the fee is to be paid; and\n(vi) that failure to pay the fee in accordance with the notice will result in the issue of a variation certificate in accordance with paragraph 45 of Schedule 6;\n(c) if sub-paragraph (a)(i) applies, the amount of the fee is—\nA×(W−S)where—\n(i)A is £12 where the finding is of a failure to meet a target for target period 1 or target period 2, £14 where the finding is of a failure to meet a target for target period 3 or target period 4 , £18 where the finding is of a failure to meet a target for target period 5 , or £25 where the finding is of a failure to meet a target for target period 6;\n(ia)where the finding is of a failure to meet a target for target period 7, 8 or 9, A is the number of pounds sterling which is equal to the result of the application of the formula in paragraph (3) in respect of that target period, rounded up or down to the nearest pound;\n(ii)W in units of tCO2 equivalent represents the amount by which the emissions for the target period exceed the target; ...\n(iii) S, for target periods 1 to 4, in units of tCO2 equivalent represents any surplus; ...\n(iv)S, for target periods 5, 6 and 7, is zero;\n(v)S, for target period 8, in units of tCO2 equivalent represents any surplus in respect of target period 7; and\n(vi)S, for target period 9, in units of tCO2 equivalent represents any surplus in respect of target period 7 or 8;\n(d) if sub-paragraph (a)(ii) applies, the amount of the fee is—\nA×Wwhere—\n(i)A is £12 where the finding is of a failure to meet a target for target period 1 or target period 2, £14 where the finding is of a failure to meet a target for target period 3 or target period 4 , £18 where the finding is of a failure to meet a target for target period 5 , or £25 where the finding is of a failure to meet a target for target period 6; ...\n(ia)where the finding is of a failure to meet a target for target period 7, 8 or 9, A is the number of pounds sterling which is equal to the result of the application of the formula in paragraph (3) in respect of that target period, rounded up or down to the nearest pound; and\n(ii)W in units of tCO2 equivalent represents the amount by which the emissions for the target period exceed the target;\n(e) if sub-paragraph (a)(i) applies, the fee must be paid on or before 1st July in the year in which the facility is found to have failed to meet its target;\n(f) if sub-paragraph (a)(ii) applies, the fee must be paid within 30 working days beginning with the date of the notice; and\n(g) payment of the fee is deemed to have been made when the person to whom the fee must be paid as specified in the notice receives full cleared funds.\n(3) The formula in this paragraph is—\nA×BC×D×E×1000 +F×GH×E×1000×0.5where—\n(a)A is the number of pounds sterling which is specified in the Table in paragraph 42(1) of Schedule 6 on the 1st April in the first year of the relevant target period as payable by way of levy—\n(i)per kilowatt hour;\n(ii)on a taxable supply of electricity;\n(b)B is 1, reduced by the percentage which is specified in paragraph 42(1)(ba) of Schedule 6 (reduced-rate supply of electricity) on the 1st April in the first year of the relevant target period;\n(c)C is the carbon emission factor for electricity of 0.0274;\n(d)D is the factor for calculating the primary energy associated with a unit of electricity supplied by an electricity utility, which is 2.1;\n(e)E is the relative molecular mass of carbon dioxide to carbon, which is 44 divided by 12;\n(f)F is the number of pounds sterling which is specified in the Table in paragraph 42(1) of Schedule 6 on the 1st April in the first year of the relevant target period as payable by way of levy—\n(i)per kilowatt hour;\n(ii)on a taxable supply of gas supplied by a gas utility or any gas supplied in a gaseous state that is of a kind supplied by a gas utility which is not a reduced-rate supply;\n(g)G is 1, reduced by the percentage which is specified in paragraph 42(1)(c) of Schedule 6 (reduced-rate supply of gas) on the 1st April in the first year of the relevant target period;\n(h)H is the carbon emission factor for gas of 0.0497;\n(i)“carbon emission factor” means the mass of carbon or carbon equivalent emitted in kilograms per kilowatt hour of energy consumed;\n(j)“primary energy” means energy that has not undergone any conversion or transformation process;\n(k)“relevant target period” means the target period in respect of which the formula in this paragraph is applied.",
  "extent": "E+W+S+N.I.",
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "F",
      "label": "F1",
      "text": "Words in reg. 12(2)(a) substituted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(a)(i) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F2",
      "text": "Words in reg. 12(2)(a) substituted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(a)(ii) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F3",
      "text": "Word in reg. 12(2)(b)(i) substituted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(b) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F4",
      "text": "Reg. 12(2)(c) substituted (30.12.2016) by The Climate Change Agreements (Administration) (Amendment and Related Provision) Regulations 2016 (S.I. 2016/1189), regs. 1(1), 3(2)"
    },
    {
      "type": "F",
      "label": "F5",
      "text": "Sum in reg. 12(2)(c) substituted (1.10.2020) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2020 (S.I. 2020/958), regs. 1(2), 2(3)(a)(i)(aa)"
    },
    {
      "type": "F",
      "label": "F6",
      "text": "Words in reg. 12(2)(c) inserted (1.10.2020) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2020 (S.I. 2020/958), regs. 1(2), 2(3)(a)(i)(bb)"
    },
    {
      "type": "F",
      "label": "F7",
      "text": "Sum in reg. 12(2)(c)(i) substituted (31.12.2023) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2023 (S.I. 2023/1226), regs. 1(2), 2(3)(a)(i)(aa)"
    },
    {
      "type": "F",
      "label": "F8",
      "text": "Words in reg. 12(2)(c)(i) inserted (31.12.2023) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2023 (S.I. 2023/1226), regs. 1(2), 2(3)(a)(i)(bb)"
    },
    {
      "type": "F",
      "label": "F9",
      "text": "Reg. 12(2)(c)(ia) inserted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(c)(i) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F10",
      "text": "Word in reg. 12(2)(c) omitted (1.10.2020) by virtue of The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2020 (S.I. 2020/958), regs. 1(2), 2(3)(a)(ii)"
    },
    {
      "type": "F",
      "label": "F11",
      "text": "Words in reg. 12(2)(c) substituted (1.10.2020) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2020 (S.I. 2020/958), regs. 1(2), 2(3)(a)(iii)"
    },
    {
      "type": "F",
      "label": "F12",
      "text": "Word in reg. 12(2)(c)(iii) omitted (1.1.2026) by virtue of The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(c)(ii) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F13",
      "text": "Reg. 12(2)(c)(iv) substituted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(c)(iii) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F14",
      "text": "Reg. 12(2)(c)(v)(vi) inserted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(c)(iv) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F15",
      "text": "Reg. 12(2)(d) substituted (30.12.2016) by The Climate Change Agreements (Administration) (Amendment and Related Provision) Regulations 2016 (S.I. 2016/1189), regs. 1(1), 3(3)"
    },
    {
      "type": "F",
      "label": "F16",
      "text": "Sum in reg. 12(2)(d) substituted (1.10.2020) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2020 (S.I. 2020/958), regs. 1(2), 2(3)(b)(i)"
    },
    {
      "type": "F",
      "label": "F17",
      "text": "Words in reg. 12(2)(d) inserted (1.10.2020) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2020 (S.I. 2020/958), regs. 1(2), 2(3)(b)(ii)"
    },
    {
      "type": "F",
      "label": "F18",
      "text": "Sum in reg. 12(2)(d)(i) substituted (31.12.2023) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2023 (S.I. 2023/1226), regs. 1(2), 2(3)(b)(i)"
    },
    {
      "type": "F",
      "label": "F19",
      "text": "Words in reg. 12(2)(d)(i) inserted (31.12.2023) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2023 (S.I. 2023/1226), regs. 1(2), 2(3)(b)(ii)"
    },
    {
      "type": "F",
      "label": "F20",
      "text": "Word in reg. 12(2)(d)(i) omitted (1.1.2026) by virtue of The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(d)(i) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F21",
      "text": "Reg. 12(2)(d)(ia) inserted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(d)(ii) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F22",
      "text": "Words in reg. 12(2)(e) substituted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(7)(e) (with reg. 4)"
    },
    {
      "type": "F",
      "label": "F23",
      "text": "Reg. 12(3) inserted (1.1.2026) by The Climate Change Agreements (Administration and Eligible Facilities) (Amendment) Regulations 2025 (S.I. 2025/813), regs. 1(1), 2(8) (with reg. 4)"
    },
    {
      "type": "I",
      "label": "I1",
      "text": "Reg. 12 in force at 1.10.2012, see reg. 1"
    }
  ],
  "outstanding_effects": [
    {
      "type": "word substituted",
      "affecting": "uksi/2026/826",
      "affecting_title": "The Climate Change Agreements (Administration, Energy-intensive Installations and Eligible Facilities) (Amendment and Revocation) Regulations 2026"
    }
  ],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/uksi/2012/1976/regulation/12",
    "retrieved_at": "2026-10-29T01:23:45.300644+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}