The Department of Energy and Climate Change (DECC) has announced significant changes to the forthcoming Carbon Reduction Commitment (CRC).
In its quarterly stakeholder update released yesterday, DECC published its responses to a consultation issued earlier this year which sought opinions on various technical details of the scheme. After considering feedback from more than 250 stakeholder responses, DECC has made a number of changes to the CRC, including:
Double sale and recycle scheme abandoned to improve cash flow: The first sale of allowances in April 2011 will now only require participants to purchase for the year ahead, and no longer for the previous year as well. The first year of the scheme (April 2010 – March 2011) will now simply be regarded as a ‘monitoring period’.
Greater league table weighting of early action metrics: Critics have previously argued that the scheme did not offer sufficient recognition for those organisations which have been more successful in reducing their energy consumption prior to the start of the scheme. In response to this, DECC has decided to reduce the weighting of the early action metrics (installation of AMR and obtainment of Carbon Trust Standard) more gradually. The weighting of the early action metrics on the overall performance score will thus account for 100% in the first year of the scheme (no change), 40% in the second year of the scheme (was 20%) and 20% in the third year of the scheme (was 0%).
Principal subsidiaries: Large subsidiary companies which would qualify in their own right can now choose whether to participate independently of their organisational group or parent company.
Renewable energy: The CRC will not provide additional incentives for renewable generation. However, an organisation’s increased use of onsite renewable generation, together with corresponding energy efficiency savings, will now be published alongside the performance league table. According to DECC, this will ‘allow organisations to gain reputational credit for their investment in onsite renewables’.
Change of name: The CRC will now be known as the CRC Energy Efficiency Scheme. According to DECC, the name change has been introduced to ‘better reflect the primary objective of the scheme, which is the achievement of carbon emission reductions through increased energy efficiency’.
