The carbon-cutting beast that is the Carbon Reduction Commitment Energy Efficiency Scheme (CRC) is aimed at cutting the UK’s carbon emissions.
While many businesses want to reduce their energy emissions, the CRC has attracted criticism for being overly complicated and costly.
According to a KPMG report, it is estimated the administrative cost per participant to date has been between £30,000 to £36,000, with future costs of about £8,000 per year over the next three years.
This will impact on SMEs taking part in the scheme, where they have to cover costs, establish management systems, registering with the scheme and producing reports.
To simplify the CRC, the Government published a consultation in March. Rather than announcing anything out of the ordinary, it builds on several informal discussion papers issued in 2011.
These include qualification for phase two of the scheme, based only on the consumption of electricity by business through settled half hourly meters and the 6,000MWh annual threshold. Although this will lead to a reduction in the number of participants, modelling suggests emissions coverage at current levels will be maintained.
The supply rules will remain the same but amended to provide clarity in third party scenarios. However, there will be no requirement for payment in order to establish a supply relationship.