Carbon Reduction Commitment Energy Efficiency Scheme - update

The mandatory Carbon Reduction Commitment (CRC) Energy Efficiency Scheme is a UK wide scheme to promote energy efficiency and help reduce carbon emissions from large business and public sector organisations.

Further to our CRC guide published in March 2010, on 20 October 2010, the coalition government announced changes to the scheme in its spending review 2010.

The first sale of allowances under the scheme for 2011/12 would now take place in 2012 rather than 2011 and revenue raised from the sale of CRC allowances would not be recycled to participants in the scheme but instead would be used to support the public finances.

On 17 November at the CBI Climate Change Conference, the Secretary of State for Energy and Climate Change, Chris Huhne announced the publication of a UK wide consultation on delaying the start of Phase II of the CRC. This will mean that participants won’t need to register for Phase II until 2013. The intention is to create a window for engagement in a proper dialogue with participants about what needs to be done to improve the scheme. He also revealed the aim to reduce the administrative burden on businesses and a proposal to exempt over 12,000 information declarers from the scheme.

The department for Energy and Climate Change and the devolved administrations issued the consultation on 17 November 2010. The consultation focuses on five areas:

• Changes to the timing of the CRC.
• Removal of the requirement to make Information Disclosures.
• Amending the division of responsibilities between the three administrators.
• Amending the provision regarding landlords to recognise the way that departments are accommodated in Northern Ireland Civil Service Buildings.
• Technical corrections to the CRC Order.

Only four weeks is being given for comment on this consultation so responses to the consultation must be received by 17 December 2010.

A second consultation, which will deal with the wider changes to the scheme, is expected to take place in 2011.

In the meantime, the government has advised that organisations continue to comply in full with the current scheme as failure to do so is subject to enforcement action.

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For further information please contact:
Amanda Cardall 0121 331 8125
Corporate Marketing Manager

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