CARBON REDUCTION COMMITMENT
The CRC Energy Efficiency Scheme is a mandatory carbon emissions scheme in the United Kingdom requiring large non-energy-intensive organisations in the public and private sectors to purchase allowances for the tonnes of CO2 emitted through gas and electricity use. The scheme enacted in the Climate Change Act 2008. The CRC EES is led by the Environment Agency.
For Phase 2, which began on 1st April 2014, the updated sale of allowances regulations provided for two sales of CRC Allowances for each reporting year; the forecast sale which encourages participants to purchase allowances in advance and receive a discount of around 5% and a ‘buy to comply’ sale following the reporting period. The allowance costs for the 2015/16 reporting year are £15.60 in forecast sale and £16.90 at the end of the compliance period. The allowance costs for the 2016/17 reporting year have yet to be announced but increases will be in line with the CPI.
The government announced its intention to abolish the CRC in the Spring Budget on 16th March 2016. This will happen at the end of Phase 2 with the revenue being recovered from 2019 from an uplift in Climate Change Levy through supplier invoices. The reporting requirements will be replaced and the Government will consult on the format in due course.
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