Changes to CRC have scaled back UK businesses’ efficiency plans

The UK Coalition Government’s changes to the Carbon Reduction Commitment (CRC) efficiency scheme has curtailed businesses’ energy efficiency plan, according to npower’s latest Business Energy Index (nBEI).

At its inception, the CRC scheme, which requires large energy users to monitor and report their carbon emissions, would have rewarded those making the greatest strides in energy efficiency at the price of those taking no action. All those participating in the scheme would have had to purchase the requisite carbon credits, but those at the top of the energy efficiency ranking would receive bonus payments while those at the bottom would have been penalised.

However, in last year’s Budget, the Coalition announced the removal of the recycled payments aspect of the scheme in favour of taking the payments for carbon credits as a revenue-generator for the Treasury.

Not surprisingly the move met with general disapprobation from the business community. Now, according to npower’s survey, 94% of businesses want to see financial incentives reinstated into the scheme.

A third of all respondents added that they believe that the changes to the scheme have had a negative impact on businesses’ plans in invest in energy efficiency measures.

But the survey results somewhat belie that impression, with 72% of businesses reporting that they have invested in energy efficiency measures since participating in the scheme, 62% installing smart meters and 20% taking on additional staff to manage the scheme.

Meanwhile, the general confusion surrounding the scheme also appears not to have dissipated, with nearly half (46%) of businesses saying they felt that they had not received adequate guidance from the Government about the scheme.

“The issues businesses have faced since the implementation of the CRC and through its subsequent changes have lead to ongoing confusion.

This is concerning as we approach the deadline for footprint reporting on 29 July,” says Dave Lewis, head of business energy services at npower.

The footprint reporting deadline is one of the scheme’s first milestones, but companies say they are concerned that they may not be supplying the correct data.

Going forward, what businesses now want is certainty and clarity. Over half of those speaking to npower say that they want to see no more changes to the scheme – but a large majority (82%) says they still need more clarity on what is required of them.

For further information:
www.npower.com/
www.npower.com/idc/groups/wcms_content/@wcms/@busi/documents/digitalassets/nbei8pdf.pdf
www.decc.gov.uk/en/content/cms/emissions/crc_efficiency/crc_efficiency.aspx

18 July 2011

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