Carbon Compliance

Carbon Reduction Commitment Energy Efficiency Scheme

What is the Carbon Reduction Commitment Energy Efficiency Scheme?
The Carbon Reduction Commitment (CRC) Energy Efficiency Scheme is a UK-wide mandatory carbon emission trading scheme for large businesses and public sector organisations. It is based on a ‘cap and trade’ mechanism, providing a financial incentive to improve energy efficiency by putting a price on carbon emissions from consumption.

Who is required to participate?
Organisations that consumed more than 6,000MWh of electricity via Half Hourly meters in 2008 qualify for the scheme. Participants must monitor and report carbon emissions resulting from energy consumption (excluding transport and onward supply) from April 2010 onwards and purchase allowances auctioned by the Government for each tonne of CO2 emitted.

The scheme starts in April 2010, however, organisations will have to prepare now if they are going to have the necessary processes and procedures in place.

How it works:
If your organisation qualifies you will be required to annually report on your energy-related carbon emissions. At the start of each compliance year you will need to forecast your year-ahead emissions and purchase sufficient allowances via an auction to ‘cancel’ your actual emissions at the end of the year. You will also need to continually monitor your emissions throughout the year and buy or sell allowances in a secondary market to balance your position.

The income generated from the Government auction is ‘recycled’ back to the scheme participants. The actual amount you receive will depend on your position in a performance league table of all the scheme participants. Your ranking is determined in part by how successful you have been in reducing your emissions. Top performing participants that manage to make significant reductions could receive a recycle payment of up to 150% of the allowance expenditure; the worst performers could lose up to 50%.

How we can help:
We have a free online assessment that will give you a report summarising your current position. Green Energy Partners also provides a one day CRC Stakeholder Engagement Programme to assess your readiness and develop a next steps action plan tailored to your organisation.

Our integrated CRC package is divided into a structured programme of six modules to allow organisations with differing requirements to select those which are most suitable to their needs:

• Module 1 – Strategic Assessment: Green Energy Partners will provide a full strategic review of your energy and carbon governance, management and accounting systems. We will determine your readiness for the CRC and undertake a comprehensive risk assessment of your financial and operational exposure.
• Module 2 – Compliance Preparation: We will review your current data management processes for all CRC emissions sources and assist your organisation to make the necessary changes that will ensure compliance.
• Module 3 – Software Solutions: We will help you select and implement the most appropriate software solution for your organisation. This will reduce the time and effort you spend managing your CRC obligations and reduce the risk of reporting errors, which, if left unchecked, can lead to significant penalties.
• Module 4 – Emissions Reduction Action Plan: We can help you devise a carbon reduction plan and assist with the implementation of strategic and technical measures. Critically this will include ensuring actions are implemented in an appropriate time frame to optimise your ongoing league table position.
• Model 5 – Forecasting and Trading: We will assist in developing emission forecasts for a number of different scenarios taking into account each individual site’s activities, energy usage, climatic conditions and emissions reduction plan. We can also help you determine the optimum level of allowances to purchase in the auctions and what your level of exposure to the secondary market might be.
• Model 6 - Auditing & Verification: Once the scheme is operational (from April 2010) Green Energy Partners will provide a full audit and verification service. We will undertake a quarterly review to ensure adherence to data management and evidence pack procedures and monitor your actual versus forecast demand to ensure sufficient allowances are purchased. Prior to submission of your annual and footprint reports we will verify their content and identify any gaps or errors. In addition we will audit your evidence pack to ensure that the necessary data is recorded.