Sixteen businesses have been fined more than £93,000 over the last 12-months for breaching their Carbon Reduction Commitment (CRC), according to the Environment Agency (EA).
The CRC Energy Efficiency Scheme is a mandatory carbon emissions reduction initiative that applies to large organisations in the public and private sectors in the UK.
The scheme requires participants to measure and report their electricity and gas supplies on an annual basis to the CRC registry, which calculates emissions in tonnes of CO₂.
But according to the Environment Agency, six firms failed to submit an annual report for the 2014/15 compliance year by the 31st July deadline.
How does the Carbon Reduction Commitment Scheme work?
With this in mind, TEAM’s CRC Industry Expert, Abigail Basketter, explains how businesses could comply with CRC more cost-effectively and reduce the risk of fines.
For many, the CRC scheme rules are complex and the reporting burden is significant. Some organisations have therefore failed to meet the requirements, which has led to fines and civil penalties.
Organisations will also report under the current CRC phase for the last time by the end of July 2019 and surrender allowances for emissions from energy supplied in the 2018-19 compliance year by the end of October 2019.
The CRC Scheme aims to incentivise energy efficiency and cut emissions in large energy users in the UK’s public and private sectors. That includes supermarkets, water firms, local authorities, NHS trusts and all central government departments.
These organisations must monitor and record emissions and purchase allowances for each tonne of CO₂ emitted from energy use.
In the current phase, participants have the option of buying allowances in advance in the lower price ‘forecast sale’ at the start of a compliance year, or in a higher price ‘compliance sale’ after the end of the year.
How to make the Carbon Reduction Commitment process easier?
There’s no doubt that the CRC Energy Efficiency Scheme takes up a lot of time.
Participants in CRC are required to complete Annual Report submissions (to a deadline), maintain an auditable CRC Evidence Pack and pay for CRC emissions (to deadlines).
CRC Compliance Deadlines
|Action Required||Annual Deadline|
|Order forecast sale allowances||1 April to 30 April|
|Payment for forecast sale allowances||2 June to 20 June|
|Allocation of forecast sale allowances||2 June to 15 July|
|Order buy to comply sale allowances||2 June to 31 July|
|Payment for buy to comply sale allowances||1 Sept to 19 Sept|
|Allocation of buy to comply sale allowances||1 Sept to 15 October|
|Surrender of allowances||Last working day in October|
Many businesses don’t want to get too involved with the ins and outs of the scheme’s processes because the current phase ends in 2019 and the future of the scheme is unknown. Nevertheless, they still have a legal obligation to comply.
How can TEAM help your business comply with the Carbon Reduction Commitment
TEAM can provide a complete service or support your organisation with any part of the requirements.
By working with us you could avoid developing/training in-house resources to manage the schemes rules, saving you both time and money.
We can also prepare forecasts of emissions and costs, help you prepare for audit and provide CRC administrative support. TEAM’s Energy Consultants are ideally placed to support you during the various phases of the CRC from data collation, producing CRC Annual Reports and evidence packs, forecasting and the purchase of carbon allowances.
Our service is flexible and we can support you as much or as little as you choose.
We can ensure your CRC records are accurate for an audit by the regulator and can advise your organisation how many carbon allowances to buy.
Find out more by clicking here.
Please Note: In relation to TEAM’s assistance in this process, we would need any forecast data as soon as possible, if businesses wanted assistance on estimating the number of allowances to order in April.
With regards to assistance with the reporting process we would suggest getting data to us by the end of May to allow time to review the data and establish the number of buy-to-comply allowances, that may be needed.
“Abigail was very efficient and provided excellent customer care throughout the CRC audit.”
David Jamison – Strategic Asset Manager, Middlesbrough Borough Council