Explanatory note

These Regulations apply to installations covered by Schedule 6 paragraph 51 to the Finance Act 2000 by virtue of the Climate Change Agreements (Energy-intensive Installations) Regulations 2006 (S.I. 2006/59) and to sites upon which there is such an installation or part of an installation.

These Regulations provide that such an installation or site will be taken to be a facility eligible for inclusion in a climate change agreement where the installation or site is an ‘eligible facility’ under the Climate Change Agreements (Eligible Facilities) Regulations 2001 (S.I. 2001/662) (i.e. at least 90% of the energy supplied to the facility will be used within an installation), the installation or site meets the energy intensity criteria or belongs to a business sector that meets the energy intensity criteria, and the energy to be supplied to the installation or site will be used for the purpose of carrying out an eligible process.

The energy intensity criteria will be met where the predicted energy costs of the installation or site or the business sector to which the installation or site belongs amount to 10% or more of production value or, if less than 10% but at least 3%, where there is an import penetration ratio of at least 50%.

An eligible process is a process or activity or combination of processes or activities as described in the Schedule carried out at an installation or site which, when taken alone or together within the business sector to which the installation or site belongs, meets the energy intensity criteria.

A full regulatory impact assessment has not been prepared for this instrument as it has no impact on business, charities or voluntary bodies.