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The UK has set itself a target of reducing its National carbon emissions by 80% by the year 2050.

The Carbon Reduction Commitment Energy Efficiency Scheme (CRC) is a mandatory emissions trading mechanism for businesses and public sector organisations introduced by Government in support of this goal.

Monitoring & Reporting Energy Data

Participants are required to continuously monitor their on-site, fixed source energy consumption. There are two types of reports required of participants:

  • A 'Footprint Report' at the beginning of each Phase (Phase 1 is 3 years and all subsequent phases 7 years).
  • An 'Annual Report' at the beginning of each financial year.

One in five Participants will be audited by the Environment Agency each year to ensure these are accurate. Records must be kept in support of this data and there may only be a 5% margin of error.

Carbon Allowances

A participant must purchase 'allowances' to cover the carbon emissions they declare in their reports.

Allowances are purchased based on forecasted carbon emissions at the beginning of every phase..

Until April 2013, the price of carbon will be fixed at £12 per tonne. At this point the price will rise to £16 per tonne, with the few of further rises expected from 2020 onwards.

Energy Management

Because participants will need to purchase allowances for each tonne of carbon they emit, there are incentives to invest in energy efficiency savings to reduce this cost.

Participants will need to weigh up the benefits of investing in low-carbon technology against the cost of purchasing allowances. In Phase 2, a 'cap' will be placed on the total amount of allowances that will be sold, providing further impetus for organisations to reduce their energy consumption.

League Table Positioning

Participants will be evaluated on their relative performance in energy management and not on absolute performance.

This means that participants will not only have to reduce their emissions, they will have to reduce them more than other participants do. This will determine the amount of revenue they gain or lose from the allowance recycling process.

League positioning will also be publicised and therefore the scheme also holds Corporate Social Responsibility value and associated risks.

There are three metrics that will be used to determine performance:

  • Early Action Metrics: Only applicable in Phase 1. To obtain credits participants must install smart meters and/or obtain the Carbon Trust Standard.
  • Growth Metrics: Takes into account the expansion of the organisation and correspondent increase in energy consumption.
  • Absolute Metrics: Determines whether an organisation's energy consumption has changed compared to a rolling 5 year average.

 

Strategic Planning and Risk Management

Organisations that want to derive maximum benefit from the CRC scheme will look to place energy management within their overall business strategy and to mitigate any potential risks.

Our extensive consultancy experience with blue-chip companies makes us the ideal partner to foster interest at board level and develop a comprehensive plan that integrates energy management across all levels of the company. This could involve a number of areas depending on your needs:

  • Business strategy
  • CRC Scheme variation and maturation
  • Tacit knowledge changes
  • Technological advancement
  • Underlying wholesale energy market price
  • Carbon Trading

Energy Management

Implementing an energy management action plan requires technical knowledge and financial awareness as well as a thorough understanding of the utility market.

With in-depth experience delivering high quality energy services and products, we can ensure that implementation is timely, economical and in-line with your broader business strategy. You may be interested in:

  • Organisational Education Plan development
  • Desktop Audits
  • Site Audits
  • Capital Funding Identification & Application
  • Effective technological procurement
  • Project Management
  • Financial Management (appropriate management accounting and life-time cost analysis)

Renewable Generation

For organisations that have already implemented a number of energy efficiency initiatives, on-site generation becomes an important consideration.

These projects are complex and due to the costs involved it is essential that a comprehensive feasibility assessment is made and the return from feed-in tariffs are analysed.

Our consultants will be able to manage your project from conception through to implementation, ensuring that you maximise your financial return and scheme value.