Aardvark News
Are you ready for the CRC?
Until the final legislation is in place, the implications cannot be fully known, however the principles, if not the detail of the scheme is clear and Aardvark are well placed to help UK companies who need to be aware of their likely liability and how it can be managed and minimised effectively.
The Carbon Reduction Commitment (CRC) is a new carbon emissions trading scheme that will affect large organisations in the UK. It is now moving through its final consultation phase and will come into force on 1st April 2010. The threshold for the scheme is using more than 6,000 MWh of electricity in 2008 through at least one half hourly electricity meter; you may be exempt if you are already in a CCA or EUETS scheme.
6,000 MWh of electricity equates approximately to an energy bill of £0.5m per annum or a 250,000 sqft office building.
What does this mean for you?
You could have already received a letter from the Environment Agency outlining the scheme if your organisation consumed electricity through at least one half-hourly electricity meter (HHM) settled on the half-hourly market during the CRC qualification period, which was the 2008 calendar year.
The letters were sent to all individual HHM billing addresses in May this year. If your organisation as a whole has numerous sites which are each billed individually, then each site should have received its own letter. We are aware that a number of these letters were addressed to the wrong recipient and therefore not logged onto internal systems to be addressed.
The basic rule under CRC is that any electricity consumption counts as your responsibility if your organisation holds the contract with the electricity supplier for that electricity supply. Generally this will be the organisation responsible for paying the bill.
If you purchase electricity through a third party agent who procures energy services on your behalf and pays the bills, you are still responsible as the organisation that contracted the agent.
What to do now
Getting carbon fit and having a strategy in place will save money. The key questions you need to address at this stage are as follows;
- Have you received the letter from the Environment Agency confirming you are in the CRC scheme;
- If so, determine what is in and out of the CRC for the whole of your property portfolio;
- Which of your companies/subsidiaries/development partners or sub-tenants are responsible for the CRC, registration, CRC allowance purchase/recovery and on-going administration.
To get carbon fit for the CRC, contact the Aardvark team on 01984 624989 or email us on carbon@aardvarkem.co.uk
Tuesday, 06 October 2009