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Major changes to CRC scheme
The comprehensive spending review includes the following:
'2.108 The CRC Energy Efficiency scheme will be simplified to reduce the burden on businesses, with the first allowance sales for 2011-12 emissions now taking place in 2012 rather than 2011. Revenues from allowance sales totalling £1 billion a year by 2014-15 will be used to support the public finances, including spending on the environment, rather than recycled to participants. Further decisions on allowance sales are a matter for the Budget process.'
This means:
- 1. The first sale of allowances will be in 2012-13 rather than April 2011.
2. Therefore government allowances will be bought using actual data for 2011-12 rather than forecast energy data.
3. There will be no allowances revenue recycling payment and no related bonus and penalty calculations.
4. Therefore no allowance monies from the government sale will be received back by participants.
5. The price for government allowances in the introductory phase is currently stated to be £12 per tonne of CO2 but this price is subject to the budget process and so is not yet confirmed.
6. The league table will be retained, including all three metrics but their impact is now limited to reputation only (no bonus/penalty calculations).
A further consultation process is being undertaken with a view to further simplification of the scheme.
CIPFA will be producing a new briefing paper on CRC once the full impact of the changes and consultation have been clarified by DECC and the Environment Agency.
Tailored Support We provide tailored solutions to suit individual organisation’s needs on a range of subjects. From in-house training courses to interim resources to project management support. If you are interested, email carbonfinancenetwork@cipfa.org.uk |
Carbon Reduction Commitment Energy Efficiency Scheme
The Carbon Reduction Commitment Energy Efficiency Scheme (CRC EES) is an important part of plans to reduce UK emissions in line with requirements established by the Climate Change Bill. It developed from the recommendation for the establishment of a price for carbon in the Stern report and is seen as a key mechanism for bringing about a reduction in green house gas emissions.
The scheme affects government departments, and those local authorities, schools, NHS trusts, fire and police authorities that qualify for the scheme. It also includes private sector companies.
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