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Crc Presentation

  1. 1. Carbon Reduction Commitment <br />Barry Shambrook, Tuckers Consultancy Ltd<br />020 7987 1420,<br />
  2. 2. What is CRC?<br /><ul><li>UK “Cap and Trade” scheme that aims to reduce year on year energy use
  3. 3. From April 2010 allowances must be purchased for every tonne of CO2 emitted, initially at a fixed price of £12 / tonne CO2
  4. 4. From 2013 allowances will be caped and publically auctioned, price expected to rise!
  5. 5. Government will publish a performance league table showing comparative performance of all participants </li></li></ul><li>Climate Change Act 2008<br /><ul><li>Climate Change Act 2008
  6. 6. Became law on 26 Nov 2008 Aims to transition UK to a low carbon economy
  7. 7. Legally binding target of 80% reduction in greenhouse gas emissions by 2050 (from 1990 level)
  8. 8. 34% reduction in CO2 by 2020 (from 1990) Introduction of emission trading scheme - Carbon Reduction Commitment for top 5000 organisations
  9. 9. Introduction of mandatory yearly energy reporting requirements for top 175,000 electricity consumers</li></li></ul><li>Its Not A Tax<br />The CRC League Table ranks organisation against three metrics <br /><ul><li>Absolute Emissions : percentage reduction compared with previous year (based on rolling average of past 5 years)
  10. 10. Growth : percentage reduction per unit of turnover
  11. 11. Early initiatives : actions taken before 2011
  12. 12. Percentage of emissions covered by Carbon Trust Standard see
  13. 13. All revenue will be returned to the scheme, payments from bottom 50% are used as bonuses for organisations at top of the league table
  14. 14. Payments made in April but bonuses are not paid until October - cash flow
  15. 15. CRC League Table publically available to show CSR - no more “green washing”
  16. 16. Large penalties for under reporting (£75 / tCO2)
  17. 17. Potential to make profit by being at top of league table </li></li></ul><li>Who is included? <br />• Any organisation spending more than £500,000 on electricity (~5000)<br />• Any organisation with more than one half hourly electricity meter must report usage (~175,000)<br />• All state-funded schools and universities – new!<br />• All central government departments<br />• Qualification based on electricity, but if you qualify you must collect and non-gas report on non transport fossil fuels (mainly gas, oil)<br />• CRC targets highest parent organisation who must report on energy usage of all subsidiaries<br />• Scheme still applies even if you already buy 100% renewable electricity<br />• Based on average conversion factor of 0.537kg CO2 / kWh<br /><br />
  18. 18. Timeline for compliance<br />• 2009 September – Everyone with a half hourly meter must report on their usage in 2008 and supply a list of half hourly meter numbers<br />
  19. 19. Timeline for compliance <br />• 2010 April - Trading scheme starts<br />
  20. 20. Timeline for compliance <br /><ul><li>2011 April - allowances are purchased for 2010/11 based on actual usage at a tCO2 fixed price of £12/</li></li></ul><li>Timeline for compliance <br /><ul><li> 2011 April - allowances are forecasted and purchased in advance for 2011/12 usage at a fixed price of £12/tCO2 </li></li></ul><li>Timeline for compliance <br /><ul><li>2011 July - Submit Footprint Report and surrender random sample will be audited each year</li></li></ul><li>Timeline for compliance <br />• 2011 October – First league table is published based on 2010/11 and the first bonus payments are made based on position in the league table<br />
  21. 21. Timeline for compliance <br />• 2012 April – Buy allowances in advance for 2012/13 at a fixed price of<br />£12/tCO2<br />
  22. 22. Timeline for compliance <br /><ul><li>2012 October – Second repayment based on 2011/12 performance returning cash paid in April</li></li></ul><li>Timeline for compliance <br /><ul><li>2012 October – Second repayment based on 2011/12 performance returning cash paid in April</li></li></ul><li>Timeline for compliance<br />• 2013 April - Buy allowances in advance for 2013/14. Capping and begins auctioning of carbon allowances begins.<br />
  23. 23. Penalties For Non Compliance <br /><ul><li>Failure to register is a fine of £5000 + £500 per day
  24. 24. Failure to disclose information is £1000 once registered
  25. 25. Failure to submit annual report is £5000 + £0.05 / tonne of CO2 per day. Bottom ranking on Performance League Table
  26. 26. Incorrect reporting £40 / tonne CO2
  27. 27. Falsification or reckless statements results in imprisonment up to three years, fine up to £50,000</li></ul>Reputational risk to brand by being<br />at the bottom of league table!<br />
  28. 28. Reasons For Non-Compliance<br />Lack of staff time and resources<br />Poor departmental coordination - IT / Finance / Facilities<br />Budgetary constraints<br />Inadequate information and guidance<br />Lack of sustainability awareness<br /> Poor procurement coordination<br />Lack of best practice methods<br />
  29. 29. A plan for compliance <br />Work with a specialist!<br />Capture and report half hourly consumption data<br />Prepare to input data to Government portal and maintain a log for audit purposes<br />Build automated data collection networks<br />Implement solutions that enable analysis and forecasting for CRC Credits Trading<br />Install sub-meters to achieve a more granular level of detail<br />Target the big users and drive behavioral change<br />Overcoming landlord objections and gaining consent<br />Explore retrofit energy saving technologies and solutions<br />A continuous process of improvement<br />
  30. 30. Prepare a Trading Strategy <br />Implement solutions support to CRC trading<br /><ul><li>Statistical analysis of existing consumption is essential to allow accurate forecasting so the correct number of CO2 credits can be purchased 2 p
  31. 31. Use software that allows meter data to be consumed and analysed
  32. 32. Automate data collection required for Footprint Report and evidence pack
  33. 33. Tools to allow accurate budgeting and forecasting
  34. 34. Automatic Monitoring and Targeting packages qualify for tax breaks under Enhanced Capital Allowance scheme
  35. 35. Organisations need to develop trading expertise once allowances are auctioned and traded on secondary market</li></li></ul><li>Energy Reduction<br />Deploy a range of energy reduction techniques<br />Optimising air flow within a room based on physical occupancy<br />Maximise natural ventilation and free cooling where possible through intelligent control<br />Set point and dead band optimisation<br />Fit variable speed drives to all key motors, fans and pumps<br />the zoning sequencing Review and of chillers and boilers<br />Timing controls to switch off heating and lighting in certain areas (often used with occupancy detection)<br />Lux or photocell to maximise the use of natural light with zone based lighting configurations such as specific circuits around the windows<br />Full system re-commission<br />