Carbon Reduction Commitment (CRC)
The CRC is the third piece of environmental legislation that will affect businesses in the UK following the introduction of the Climate Change Levy (CCL) and the EU Emissions Trading Scheme (EU ETS). It is aimed at reducing emissions from those businesses that are not yet captured by the above schemes.
The CRC is a UK-wide "cap and trade" scheme where organisations who have consumed over 6,000 Megawatt hours (MWh) of half-hourly metered electricity in calendar year 2008 will have to monitor and report on their CO² emissions annually and buy allowances accordingly. The capital raised by the sale of allowances will be recycled back to participants in accordance with performance. Those organisations that have performed well will benefit financially, whilst those who have not will be penalised.
In addition to the burden of allocating a significant budget for the purchase of allowances, (a minimum of £38,000 will have to be expended to purchase allowances at the first sale) under-performing could mean organisations receiving significantly less than this figure at the point the funds are recycled.
This scheme will be mandatory and non-compliant organisations will be subject to significant financial penalties.
Those organisations with half-hourly meters, but consuming less than 6,000 MWh will still have to make an Information Disclosure and report on their half-hourly electricity consumption for each phase of the scheme.
Monitoring and reporting on corporate CO² emissions
Organisations will be required to accurately monitor emissions from all energy sources including electricity, natural gas, LPG and oil. This data will then need to be manipulated in order to calculate the quantity of allowances that the organisation will need to purchase to cover the resultant emissions.
The aim of the CRC is to cover emissions not yet captured by Climate Change Agreements (CCAs) or EU ETS. Consequently, various mechanisms exist within the framework of the scheme, which if applied correctly, will exempt some organisations or sites from participating in the CRC.
Furthermore, for those organisations that are required to participate in the CRC there exist additional concessions, which if correctly interpreted and applied, will assist in reducing both the administrative burden and furthering the performance of that organisation within the scheme.
It is therefore necessary to have an accurate picture of energy consumption across an entire organisation and have the appropriate systems and procedures in place to ensure reliability and accuracy of data. Organisations participating in the CRC will be required to maintain evidence packs, effectively providing an audit trail demonstrating full compliance.
Here at M&C Energy Group we have always kept one step ahead of impending environmental legislation. This enables us to not only advise our clients on how best to prepare, but additionally how they might benefit.
Since its inception in April 2001, M&C Energy Group have successfully obtained Climate Change Levy relief on behalf of many of our clients, not only taking care of all administrative tasks, but trading carbon allowances on their behalf and providing comprehensive on site support in the event of an audit by the scheme administrators.
This forthcoming CRC legislation will have a large impact on UK businesses, financially as well as administratively. It is therefore essential that any organisation required to participate in the scheme is fully aware of the implications of the legislation and how to achieve the most form it.
M&C Energy Group is ideally placed to offer your organisation a complete CRC management package. In essence, we will take care of the entire CRC process on behalf of your organisation. From initial registration, reporting and maintaining the evidence pack to carbon trading and providing on site support in the event of an audit. M&C Energy Group can manage all aspects of the CRC legislation, freeing up your people to get on with what they do best.
For more information on CRC please download the document below.
