Carbon Reduction Commitment
Carbon Reduction Commitment (CRC) The Basics - Last Updated Mar-10
Starting in April 2010, the Carbon Reduction Commitment is the UK's first mandatory carbon trading scheme. The initial phase of the Carbon Reduction Commitment will be compulsory for organisations that consume over 6,000 MWh (6,000,000 kWh) of half-hourly metered electricity during the period from January 2008 to December 2008. At today's prices, this is roughly equivalent to total half hourly electricity bills of approximately £500,000 per year.
Carbon Reduction Commitment
The aim of the Carbon Reduction Commitment is to reduce the level of carbon emissions currently produced by the larger 'low energy-intensive' organisations by approximately 1.2 million tonnes of CO2 per year by 2020. As a Climate Change Bill commiment, the scheme is aiming for a 80% redution in CO2 emissions by 2050.
The Carbon Reduction Commitment will cover both public and private sector organisations. At present, the carbon reduction scheme is expected to affect approximately 5,000 organisations in the UK. In doing so, it is anticipated that the scheme will affect 25% of total business sector emissions within the UK.
- 80% redution in CO2 emissions
More on the CRC
The scheme will work in tandem with the existing European Union Emissions Trading Scheme and Climate Change Agreements. As a result, where emissions have been captured by the EU ETS and CCA, these emissions will not be captured by the CRC. In essence, the CRC is targeted at low energy-intensive users. The Climate Change Bill also sets the enabling powers for the Carbon Reduction Commitment and sets out the role of the Climate Change Committee that will oversee much of the CRC scheme.
While the scheme doesn't officially start until April 2010, many organisations will need to make preparations before that date to ensure that they comply with all legal requirements and fully participate in the scheme.
In June to July 2009 the Environment Agency will write to all UK billing addresses with half hourly meters. The Environment Agency is the Scheme Administrator for the whole of the UK. If you receive a letter you will need to take action under the CRC. It is important that the letter reaches the right person in your organisation. The letters will be sent to billing addresses, not head offices. Therefore you should ask on-site staff to pass on this information as necessary. The letter will provide details of your half-hourly meters, and explain what you need to do next. You will need to provide evidence to the Scheme Administrator of your electricity consumption from 1 January 2008 to 31 December 2008. If you do not have records of your electricity consumption, your electricity supplier will be able to help you get this information.
Early Action Metrics
As an incentive to install AMR meters, and in recognition for good energy management undertaken prior to the start of the CRC scheme, there is a mechanism called the Early Action Metric which rewards participants who install voluntary half hourly electricity AMR and gas AMR by 31st March 2010.
In addition to this, another Early Action Metric is to obtain the Carbon Trust Standard certification which will also rewards participants who obtain this standard by 31st March 2011.
Half Hourly Sites Below 6,000MWh in 2008
If your half hourly metered electricity use was below 6,000MWh in 2008 you will have to make an ‘information disclosure’ of your electricity consumption to the CRC registry.
Information Disclosure - Organisations that have a settled half hourly meter but do not meet the qualification threshold above for participation in CRC will have to disclose information on the half hourly meters they have and their electricity consumption to the administrator via the CRC registry. This is only on half hourly sites with consumption greater than 3,000 MWh during 2008.
The next wave of qualifying period and criteria for CRC is if an organisation consumes 6,000 MWh or more of electricity from half hourly metered electricity supplies during the next qualifying year (2012).
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