The Carbon Reduction Commitment – Larger RPS Take Note

Key issues for the sector following the Climate Change Act 2008

The carbon reduction commitment (CRC) arises out of the Climate Change Act 2008. It is a carbon emissions reduction scheme for the UK that impacts businesses beyond the heavy industrial energy users already caught by European Union (EU) regulations. It introduces an annual 'cap and trade' system whereby organisations will be required to purchase carbon permits for their anticipated emissions and then later receive rebates plus or minus a bonus or a penalty dependant upon their actual performance against other participants. While the Government is likely to carry out some fine tuning, the main aspects are finalised.

The CRC scheme applies to all UK businesses with at least one half-hourly electricity meter (HHM) and electricity usage for the 2008 calendar year greater than 6,000 MWh, which may broadly equate to a spend of approximately £500,000 or more. It is not specifically aimed at RPs, but those