UK Government delays carbon reduction scheme for businesses

A regional director with the CBI has expressed "disappointment", at UK government plans to delay the implementation of the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme.

Last Wednesday the Secretary of State for Energy and Climate Change, Chris Huhne, told the Confederation of British Industry (CBI) the government's decision that in response, David Bilclough, Regional Councillor for the CBI in the North East, released a statement to the media on November 22, stating: "From the UK renewable industry's point-of-view it is obviously disappointing that the Government has announced it is going to delay – by a year – the implementation of the CRC Energy Efficiency Scheme…"

However, he encouraged businesses not to delay their efforts to reduce carbon emissions, adding that the scheme was an "important part of the jigsaw in facilitating the UK's shift to a low carbon economy".

The CRC is a mandatory scheme aimed at improving energy efficiency and cutting emissions in large public and private sector organisations. These organisations are responsible for around 10 per cent of the UK's emissions.

The scheme will feature an annual performance league table that will rank participants on energy efficiency. The mandatory scheme was introduced by the government in April to force businesses like banks, hotels, hospitals and schools to help cut Britain's greenhouse gas (GHG) emissions by four million tonnes and corporate energy bills by £1 billion a year by 2020.

The first phase began in September and enforced 5,000 businesses to reduce GHG emissions. In the second phase, scheduled for 2013 and not 2011 as originally planned, carbon emissions will be capped and carbon permits can be traded.

After announcing the delay, Chris Huhne launched a consultation into the second phase of the scheme, which was heavily criticised for being overly complex. "That will create a window for us to engage in a proper dialogue with participants about what we need to improve it,"

Huhne told delegates at last Wednesday's CBI event. At the event, Huhne defended the government's decision in October to cut the income recycling aspect of the scheme, meaning that the revenue from carbon permit sales will go to the Treasury instead of being returned to firms who reduce their carbon emissions the most.

"We had to focus on getting the best value for money -- and sending a clearer price signal to participants. Given a blank slate, we would do things a little differently," said Huhne.

David Bilclough, who is also Chair of The John N Dunn Group, a national building services company based in the North East that specialises in green renewable energy solutions, added that the delay may have a silver lining.

"Whilst it is a shame, we would still encourage and believe that businesses will continue to commit themselves to this innovative scheme. Businesses and organisations have another year to prepare for the introduction of CRC and in this post credit crunch world, where everyone is tightening belts, perhaps it is not a bad thing."

Author: Leroy Robinson | Climate Action

Image: David Spender | Flickr