Accessing UK Government funds for energy saving programmes.

The UK government’s Enhanced Capital Allowance scheme (ECA) provides first year allowances to let businesses set 100% of the cost of energy saving assets against taxable profits in a single tax year. They even provide a list of tested and approved equipment to choose from, although a recent survey shows many are not aware of the Energy Technology List (ETL)

45% of UK professionals not aware of ETL

One finding of a recent Carbon Trust survey of UK professionals (‘Who do you believe about energy saving data?’) was that almost half of respondents (45%) were not aware of the existence of the ETL. The ETL is a UK government scheme managed by the Carbon Trust on behalf of the Department for Energy and Climate Change. It independently tests and lists products that show top quartile energy saving performance.

World’s largest database of its kind

It is the world’s largest database of its kind, currently covering products across 57 technology categories. For a product to be on the ETL, it must meet specific energy-saving or energy-efficient criteria. It is part of the Enhanced Capital Allowance (ECA) tax scheme for businesses.

The Department of Energy and Climate Change (DECC) annually reviews the technologies and products that qualify for inclusion. The ETL is managed on behalf of DECC by the Carbon Trust. The list of energy-efficient plant and machinery, such as boilers, electric motors, variable speed drives, and air conditioning and refrigeration systems that qualify for full tax relief.

Paul Huggins, an Associate Director at the Carbon Trust who manages the ETL scheme, says: “Organisations that want to save money on energy bills and cut carbon emissions should think carefully about the total cost of ownership for equipment. The case for investing in better energy efficiency often seems blindingly obvious, but making good decisions depends on having good quality, reliable information.

Businesses that purchase energy saving products that meet ETL criteria may be eligible for Enhanced Capital Allowances, providing accelerated tax relief.

Enhanced Capital Allowance (ECA) scheme

The ECA scheme means that a business can invest in energy-saving plant or machinery that might otherwise be too expensive. The first year allowances let businesses set 100% of the cost of the assets against taxable profits in a single tax year. This means the company can write off the cost of the new plant or machinery against the business’s taxable profits in the financial year the purchase was made.

An ECA is claimed through a business’s income or corporation tax return in the same way as any other capital allowance. HM Revenue and Customs is responsible for the tax-related aspects of the ECA scheme.  ETL includes energy saving variable speed drives from ABB Drives, IMO Precision Controls, Mitsubishi Electric, Omron Automation and Schneider Electric.  Search the ETL database here