Updates To The Carbon Reduction Commitment (CRC) Scheme
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October 16th, 2009
Following the third government consultation on the CRC scheme in the summer of 2009, the Government has now published their responses to the consultation and have since altered some aspects of the scheme. Here follows the most important changes which could affect your company.
The most important changes to the CRC policy as a result of the consultation include:
Cash flow
The first sale of allowances in April 2011 will now only require participants to purchase
allowances for the year ahead and no longer for the previous year as well. This comes after
stakeholder concern regarding the impact of a double sale on their cash flow. As a result, the
first year of the Introductory Phase will therefore become a monitoring period.
Principal Subsidiaries
Large subsidiaries that would qualify in their own right can now choose whether to
disaggregate themselves from their organisational group and participate independently. To
reflect these changes, Principal Subsidiaries are now referred to as Significant Group
Undertakings.
Early Action Metric
Organisations which have demonstrated commitment to reducing their emissions either by
achieving the Carbon Trust Standard, or accreditation from an equivalent scheme can use
this to be counted towards the Early Action metric. The relative weighting of this metric in the
overall performance score, compared to the Absolute reduction and Growth metrics, will be
reduced more gradually to better recognise early action taken, from 100% in the first year,
40% in the second year and 20% in the third year.
Treatment of renewables
The CRC will treat electricity which receives a Feed In Tariff in the same way as electricity
which is issued a Renewable Obligation Certificate, and has simplified the approach to
reporting and accounting for renewably generated electricity. As an energy efficiency
mechanism, CRC will not provide additional incentives for renewable generation. We will,
however, publish alongside the performance league table, the organisations increase in
onsite renewable generation together with energy efficiency savings. This will allow
organisations to gain reputational credit for their investment in onsite renewables.
Public Sector Organisations
The definition of a public sector organisation has been simplified to create better clarity for
participants in the CRC. Organisations designated as a „public authority‟ in the Freedom of
Information Act 2000 and the Freedom of Information Act (Scotland) 2002 will participate in
CRC on the basis of their individual FOI/FOI (S) listing, unless they are legally part of
another body, in which case they would participate as part of that parent body.
CRC qualification pack mailing exercise
Qualification and registration guidance for potential CRC participants (“Qualification Pack”)
will be published at the end of October. This set of guidance includes the following
documents:
- Am I in? A guide for qualification and organisation structure;
- Register as a CRC Participant; and
- Making an Information Disclosure
These guidance documents will be available on regulators‟ websites. For ease, the
Environment Agency website is at: www.environment-agency.gov.uk/crc
The Environment Agency is the Administrator for the CRC throughout the UK, and will also
be the scheme regulator in England and Wales. The Department of the Environment for
Northern Ireland and the Scottish Environment Protection Agency are the other regulators.
When the guidance is published, the Environment Agency will write to all potential participant organisation addresses with information on how to access the guidance. It will not mail the guidance itself to avoid organisations receiving parts of the guidance which may not be relevant to them, and to reduce paper waste.
The CRC regulators decided to release this guidance after the Government issued its
response to the consultation so that organisations receive complete and accurate
information that would not be subject to change. In the interim, to help organisations prepare
for the CRC, a number of CRC Brief Guidance documents have been created. These
include:
- Early Action Metric
- Automatic Meter Reading
- Making an Information Disclosure
You can find these documents at www.environment-agency.gov.uk/crc.
In May this year, a letter was sent to all Half Hourly Meter billing addresses introducing the
CRC scheme and its obligations. The Environment Agency has now amended its database,
and where possible, grouped together billing addresses that fall under the same company
name. This should help to prevent organisations receiving duplicate letters. If your
organisation receives more than one letter in the October mailing, you can contact the UK
CRC helpline so that we can update your details.
Liverpool Chamber of Commerce runs a range of services that can help members and non-members alike improve their green credentials.
