Climate change minister, Greg Barker, announced yesterday (June 30) the ‘next steps’ in simplifying the CRC Energy Efficiency Scheme.

Most notably in the simplification measures the number of the fuels subject to the scheme have been cut from 29 to 4.

A rule which requires CRC participants to account for at least 90% of their total carbon footprint emissions has also be scrapped.

Mr Barker has admitted in the past the incentive element of the CRC was cut to fill a Treasury black hole, but his plans to reform the CRC fall far short of what business leaders had hoped for.

Mr Barker admits he considered scrapping the CRC, but felt in the long term simplifying it was the better option.

The minister said: “Our proposals will provide business with greater flexibility by allowing organisations to participate as natural business units.

“Some have suggested we should replace the CRC with a conventional tax, after considering this, and other policy alternatives suggested by stakeholders, we have decided to retain the CRC, in a simplified form.

“We believe the tailored combination of reputational, financial and standardised energy measurement and monitoring drivers remain the most effective way to tackle the barriers to the uptake of energy efficiency.”

Business group the CBI, which has called for the CRC to be scrapped in the past, were unimpressed by Mr Barker’s announcement.

CBI director for business environment, Rhian Kelly, said: “We’re disappointed the Government has not gone further to repair the damage caused by its decision to remove the incentive behind the Carbon Reduction Commitment.

“While it is right to recognise there are problems with the CRC in its current form, the Government’s proposals amount to tinkering around the edges.

“It should either reinstate the revenue recycling element, or scrap the CRC altogether and look at other ways of increasing energy efficiency among businesses.”

Luke Walsh

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