UK Carbon Reduction Commitment Scheme


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UK Carbon Reduction Commitment (CRC): Who’s affected?

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UK Carbon Reduction Commitment Scheme

  1. 1. UK Carbon Reduction Commitment Scheme David Flinn A&L Goodbody
  2. 2. UK Carbon Reduction Commitment (CRC): Who’s affected? 1. Organisation has at least one meter settled on the half-hourly market in NI must register (between April 2010 and September 2010). If do not register in the time allowed fine of £5000. 2. Total half-hourly metered electricity use is greater than 6,000 megawatt-hours (MWh) between 1 January 2008 and 31 December 2008. It is estimated Organisation, including any parent company and its subsidiaries spends more than £5000,000 - £800,000 a year on Electricity, it is likely to be included in the scheme, 3. Scheme will cover - Large retail organisations, banks, large offices, universities, large hospitals, local authorities, government departments, 4. Energy Companies send information pack with energy bill. 5. If have half hourly meter and metered electricity use is greater than 6,000 MWh you have to monitor and report all energy use emissions from all sources (all electricity, gas and other fuels except for transport emissions, emissions covered by the EU ETS and emissions covered by the Climate Change Agreements). (Exemption for EU ETS and Cliamate Change Agrrements). 6. The CRC will target UK emissions of the highest parent organisation. Highest parent organisation will need to consider the electricity use of subsidiaries to assess. The Highest parent organisation is responsible for reporting on total energy use emissions, including those of subsidiaries. 2
  3. 3. Carbon Reduction Commitment (CRC): What do I have to do? 1. Participants will be required to submit annual data statements via an on-line registry to the Environment Agency in GB – the UK Scheme Administrator. 2. The Northern Ireland Environment Agency will regulate and audit the scheme in NI, i.e. will chase organisations that do not register. 3
  4. 4. Carbon Reduction Commitment (CRC): What do I have to do? Over the course of the year, an organisation will undertake the following steps: 1. Calculate their total organisation-wide energy use emissions. 2. At the start of each compliance year, (January) purchase allowances from the auction to cover their total emissions. (first 3 years there will be a fixed price sale) Monitor, assess and manage emissions throughout the emissions year (1st April to 31st 3. March). 4. If necessary/desired, an organisation could buy or sell allowances on the secondary market, or buy through the buy-only link to EU ETS (the safety valve). (Participants able to buy allowances at higher of EU ETS price and a minimum CRC floor price). 5. Report emissions and surrender sufficient allowances to cover emissions by the end of July via an on line registry. 6. Receive recycling performance payment at the end of October, incorporating a bonus/penalty calculated on the basis of their position in the performance league table. 4
  5. 5. Carbon Reduction Commitment (CRC): What do I have to do? When will CRC start? 1. The scheme is scheduled to begin in April 2010, with a three-year introductory phase (uncapped). (first capped phase start 2013 for 5 years) 2. On an annual basis organisations will be required to report all their UK-based CO2 emissions from their fixed point energy sources. This includes electricity, gas and other fuel types such as LPG and diesel. However, organisations will not be required to report on their transport emissions. Organisations using less than 6,000 MWh/year metered by half-hourly electricity meters will be exempt. 3. Whereas the EU ETS concentrates primarily on large industrial point sources, large non- energy intensive organisations are the principal focus of the CRC. Accordingly, CRC will be a ‘lighter touch’ than the EU ETS, relying on self-certification of emissions. Only have to report 90% of emissions. 4. At present the Climate Change Regulations are in draft form. There will be a consultation in Spring time next year (2009). CRC is aimed primarily at improving energy efficiency and reducing emissions within the CRC sector. 5