The Carbon Reduction Commitment explained
Does this affect your business, and if so, what are the implications? Read on for more information:
Carbon Reduction Commitment (CRC)
The CRC is an energy efficiency compliance scheme designed to promote energy efficiency, reduce carbon emissions and help businesses save money by reducing their energy bills.
Its purpose is to target emissions that are not already covered by climate change agreements or the Emission Trading System. It is therefore relevant to large and public sector organisations, such as supermarkets, banks, and local authorities.
Sole traders and individuals, who are considered small emitters, are excluded from the CRC.
Large energy using organisations that consume at least 6,000 MWh of electricity through all their half-hourly meters during 2008 must report on their emissions, monitor their energy consumption, and purchase allowances from the Government at £12 per tonne of carbon dioxide they emit. They will appear in an annual performance league table, ranked on the energy cuts they make.
If an organisation has a half-hourly electricity meter but consumed less than 6,000 MWh, they only need to register a simple information disclosure.
The first allowance sales for 2011-12 emissions will take place in 2012. Revenues from allowance sales will be used to support public finances, including spending on the environment.
The CRC began in April 2010 and is divided into phases. The first phase runs for three years, with subsequent phases lasting seven years.
Each phase has a:
Qualification period, where organisations must assess whether they qualify for the CRC;
Registration period, where organisations must submit the required information;
Series of compliance years, which run from April to March, where participants must take actions to comply with the CRC;
Footprint year, where participants must monitor their total emissions from energy supplies and determine what emissions must be included in the CRC;
Annual reporting year, where participants calculate the energy supplies it has included in the CRC.