The CRC Energy Efficiency Scheme

The CRC (Carbon Reduction Commitment) Energy Efficiency Scheme (EES) is a mandatory carbon dioxide emission reporting and trading scheme, intended to promote energy efficiency in large public and private sector organisations. However, the 2010 Spending Review delayed its full implementation and changed the scheme’s details, and following Budget 2012, it is now under review through a DECC consultation.

Smaller organisations report emissions and are then placed in performance league tables, and larger ones do this too, but also have to trade allowances to emit carbon. A draft Order for the first trading round has just (May 2012) been laid, and the first performance league tables were published in November 2011.

The CRC EES has been criticised however by businesses, who say it is too complex, and complain that any revenues raised through trading will not be recycled to the best-performing companies as originally planned, but instead retained by the Treasury. Budget 2012 said that if the scheme cannot be simplified to produce “very significant administrative savings” for businesses, then it will be replaced by “an alternative environmental tax” on which the Government will consult in Autumn 2012