government has delivered two ‘own goals’ with crc, claims energy provider
12 October 2011
The Energy Consortium (TEC) claims that changes made to the CRC Scheme post Comprehensive Spending Review (CSR) mean that proactive Carbon Managers are penalised twice; once because revenue recycling has been scrapped, and twice because allowances now have to be purchased for automated meter readings (AMR).
TEC's Head of Carbon Advisory Service, Brian Hornsby said that pre-CSR there was some logic in the CRC Scheme’s approach to early action incentives. "Installing AMRs was marketed as a means to improve ones position in the CRC league table with the prospect of a full or enhanced refund of revenue in the recycling process.
"Theoretically, organisations could get at least 90% of allowance purchase costs back under the recycling process. The significance of the ruling allowing up to 10% of emissions to be classified as ‘residual’ and therefore discounted for allowance purchasing purposes, was marginal."
Brian says the impact of scrapping revenue recycling has hidden consequences, above the obvious one of having to purchase all allowances. He says the league table no longer has any financial benefit, only reputational, adding that efficient carbon managers get no ‘bonus’, other than the satisfaction that their efforts mean less carbon will be bought.
"The impact goes deeper though. Having gone to the trouble of installing AMRs, with the attendant data collection costs, any meters that would otherwise have been classified as ‘residual’ have now become ‘core’ so allowances for these must now be purchased. Is that one own goal or two?" says Brian.
TEC is one of the country’s leading independent proponents and providers of collaborative energy procurement in the public sector, particularly to universities and colleges and suggested a number of simplifications to the CRC Scheme earlier this year to DECC.
"CRC Scheme aims are to be applauded but the vehicle for delivering the desired savings has become the legendry camel, designed by a committee commissioned to produce a race horse. This double-whammy of penalties are a clear example of the consequences of poorly worked through changes to an already over-complex scheme," suggests Brian.
TEC Members can discuss their CRC issues with Brian by calling 07583 040073 or emailing him at tec-carbon@contacts.bham.ac.uk.
About The Energy Consortium (TEC)
TEC is a not for profit organisation that has operated exclusively in the higher education (HE) and further education (FE) sector. It grew as a spin-off company from a single university (Warwick) and was constituted in 1995 and known as the Consortium for Higher Education Energy Purchasing (CHEEP). It has over 200 members and an annual energy contract value of over £300M. In conjunction with Utilyx, TEC is offering OGC audited risk-managed flexible solutions and fixed price procurement for HE and FE institutions as well as to affiliated public sector organisations.
For further information contact:
Brian Hornsby on 07583 040073 or emailing him at tec-carbon@contacts.bham.ac.uk
Or PR consultant, Jane Brodie of Str8 Marketing on 01327 830625 or 07812 491954 or email: jane@str8marketing.co.uk
