Uncertainty and lack of understanding greet official launch of CRC scheme
Business does not 'understand' and is 'unprepared' for today's (April 1) launch of Britain's much hyped carbon trading scheme.
The Carbon Reduction Commitment Energy (CRC) Efficiency Scheme is a huge rating system, or league table, offering benefits to low carbon businesses and hitting high emitters with more costs.
However, corporate responsibility consultants Acona believe ‘numerous revisions’ early in the scheme’s life have created ‘confusion’ amongst businesses.
While information from the bodies responsible for it, originally the Department of Energy and Climate Change and now the Environment Agency, has been slow to filter out.
Partner at Acona Julie Pike, said: “Few companies seem to have people in place who really understand how the scheme works.
“Despite it being billed as a light touch piece of legislation, the logistics of making it work are quite complex.
“I think we’ll see many companies not having the necessary documentation in their annual plans and evidence packs as a result.”
She also explained potential participants ‘really struggle’ to see the benefits and if they weren’t being forced to take part, would ‘do so reluctantly’.
She added: “We feel the costs and benefits of the scheme for participants is opaque to say the least.
“The lack of reasons for wholeheartedly supporting the scheme together with the high level of technical detail required prevents senior managers from really getting engaged.”
Head of climate change and sustainable development at the Environment Agency, Tony Grayling, said: “The league table is a very public judgement on how seriously you take your environmental responsibilities.
“Carbon reduction doesn’t need to be complicated or expensive, there are simple and inexpensive steps every organisation can take to cut their energy consumption – from motion sensors for lighting in offices to higher efficiency motors in manufacturing.”
He added that analysis for the Environment Agency suggests the scheme could reduce CO2 emissions by up to 11.6M tonnes per year by 2020 .
It is also expected to save organisations money through reduced energy bills – benefiting the economy by at least £1billion by 2020.
More than 20,000 organisations will have to register with the Environment Agency by the end of September this year. Around 5,000 of these organisations – those that used at least 6,000 Megawatt hours (MWh) of half hourly metered electricity in 2008 – will have to report their emissions and, from 2011, buy allowances for every tonne of CO2 they emit.
During the introductory phase in 2011 and 2012, allowances will be sold at a fixed price of £12 per tonne of CO2.
Mr Grayling added: “All the money raised from allowance sales will be recycled back to participants according to their energy performance.
“The best performers will get more money back than they paid, while poor performers will get less. From next year, the Environment Agency will publish an annual league table highlighting the best and worst performers in CRC.”
From 2013 a cap and trade system will be introduced. This will limit the total amount of carbon dioxide these organisations can emit by capping the total number of allowances available and selling them at auction.
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