asked Her Majesty's Government:What concessions will be given in regard to the imposition of the Climate Change Levy upon electricity generated by combined heat and power stations. [HL1448]

The Chancellor announced in the Pre Budget Report that there would be an exemption from climate change levy (CCL) for energy and heat generated by "good quality" Combined Heat & Power (CHP) plants. CHP plants will also benefit from inclusion as a qualifying technology in the proposed system of Enhanced Capital Allowances for energy saving investments and exemption from Non-Domestic Rates.

asked Her Majesty's Government:Whether they will exempt all electricity generated from combined heat and power (CHP) plant of good quality from the Climate Change Levy in line with their stated intention to reduce carbon dioxide emissions by treating sales of electricity from CHPs in the same way as electricity generated by renewable means. [HL1449]

It is not proposed to treat the sales of qualifying electricity generated from "Good Quality" CHP in the same way as electricity generated from renewable sources. As renewable energy sources are environmentally the most benign, it is appropriate for them to be treated more favourably than CHP for levy purposes.