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Getting ahead with the CCL The Climate Change Levy may seem like bad news for industry, but with the right attitude and a little extra investment, it can be an opportunity rather than a threat. The CCL was introduced to meet the government's commitment under the Kyoto agreement, which aims to cut emissions of the climate changing gas carbon dioxide (CO2). The UK has agreed to cut its emissions to 12.5% below 1990 levels by 2010. To do this, the CCL imposes a tax on commercial consumers of electricity, the production of which is one of the chief culprits in the release of CO2 to the atmosphere.  Set at a figure of 0.043p per kilowatt hour, the CCL was no doubt greeted with dismay by many industrial users of electricity. Yet, the picture is not all one of gloom and doom. With the right approach, the CCL can actually save you money. Making the most of it The CCL is intended as an encouragement to increase energy efficiency, not as a punitive tax. Therefore, to soften the blow, the government introduced Enhanced Capital Allowances, or ECAs, a scheme which allow companies to deduct the full cost of the investment against corporation tax in the year of purchase. ECAs can be used for a list of energy saving technologies, including motors and variable speed drives. Normally, the cost of capital goods is written off over a number of years, 25% per year on the decreasing balance. This means that on a £10,000 investment, £2,500 is written off in the first year. Companies normally continue in this way for eight years, after which some 95% of the value has been written off.  In contrast, ECAs enable users to offset the full cost in the year of purchase, reducing the tax burden and improving cash flow. An incentive for efficiency Faced with increased bills, many companies are looking at their energy use with a view to working more efficiently. Here is what any industrial company should do:  1 Use variable speed drives whenever there is a requirement for reducing motor speed, particularly in pump and fan applications. For instance, used with a centrifugal pump, a variable speed drive can save as much as 60% of the energy. Applied to a 90kW motor in continuous duty, this means £23,000 per year in saved energy.  2 Use energy efficient motors These are typically three to five percent more efficient than their standard efficiency counterparts. Applied to a 90kW motor, this could save £1,000 per year and motor.  3 Ensure your motors are properly selected, installed and looked after. Most motors in industry are oversized for their duty; while a motor reaches optimum efficiency around 75% duty, many are never loaded beyond 40%. This can save another three to five percent - another £1,000 per year and motor. Huge savings One company that has used the incentive of the CCL to improve its efficiency and save £98,000 on its annual electricity bill is Mayflower Vehicle Systems in Coventry, manufacturer of body panels for, among others, Aston Martin and MG-F cars. Mayflower was concerned about the 30kW phosphate/alkali rinse pumps, used in the company's nine-stage pre-treatment system for the panels, that were running for 10 hours per day. With the existing star-delta starter arrangement, the motors could not be turned on and off quickly to meet the rinse pump's duty cycle, without severely damaging the motor's windings and bearings. Following an energy audit by ABB Drives Alliance Partner, Sentridge Control, Mayflower has been able to change its control strategy and cut the running costs of the pumps by 87.9%. The new system uses ABB's ACS 600 and Comp-AC variable speed drives. £30,000 was invested in six drives for the phosphate and alkali rinse, chemical and soap pumps and a further 11 drives for other pumps and cooling tower applications ranging from 2.2kW to 35kW. The investment is expected to yield a return in less than 12 months. Pat O'Sullivan, Facilities Manager for Mayflower Vehicle Systems, explained: "Sentridge had one compelling phrase: "Do you want to save £98,000 off your electricity bill? Can you afford not to?"" The CCL needn't be a nightmare, with the right attitude and the right partners, it can be a dream.  Top of the page