Explanatory note

These Regulations make provision for the proper application of climate change levy (CCL) in sectors of the electricity and gas industries.

Regulation 3(1) treats supplies of electricity unlawfully made for not holding a supply licence as those of an electricity utility.

Regulation 3(2) treats supplies of electricity received by an electricity utility in the course of acting outside the scope of its supply licence as nevertheless received by an electricity utility.

Regulation 4(1) keeps a supply of electricity from a fully exempt combined heat and power station outside the charge to CCL when the supplier is an electricity utility.

Regulation 4(2) prevents CCL being charged under more than one provision when an electricity utility supplies electricity from a partly exempt combined heat and power station or burns electricity it has produced from taxable commodities.

Supplies of taxable commodities to electricity producers are exempt from CCL. However this does not apply to supplies to autogenerators or to exempt unlicensed electricity suppliers of a prescribed description. Regulation 5 prescribes for this purpose any exempt unlicensed electricity supplier who is not an auto-generator.

A person who produces electricity primarily for own consumption is an auto-generator for CCL purposes. Regulation 6 specifies that such production can only be primarily for own consumption if (a) it is not produced by an electricity utility, and (b) the producer has consumed at least 75 per cent of the output of the previous 3 months.

Regulation 7(1) treats supplies of gas unlawfully made for not holding a supply licence as those of a gas utility.

Supplies of gas to very large consumers may lawfully be made by a person who is not a gas utility. Regulation 7(2) treats such supplies as those of a gas utility.

Regulation 7(3) treats supplies of gas received by a gas utility in the course of acting outside the scope of its supply licence as nevertheless supplies received by a gas utility.

Regulation 7(4) treats supplies of electricity as nevertheless made by an electricity utility when the supplier (a) is not an electricity utility but is a gas utility, and (b) produces the electricity from supplies of gas received.

Treatment as or as not a utility under regulation 3(1), 3(2), 7(1), 7(2), 7(3) or 7(4) is for CCL purposes only.