The CRC now stands for 'Corporate Restraining Charge'
Budget spending cuts have turned CRC environmental carrots into financial sticks. claims on365
October 25, 2010 – Following the government’s Comprehensive Spending Review last week, several cuts and reductions are being put into place and the effects are already being felt across the UK. on365 calls for a review of the proposed restructuring of the Carbon Reduction Commitment (CRC).
When the CRC was initially introduced, it was positioned to the market as an initiative to ensure greener data centre operation and to significantly reduce UK carbon emissions. Originally, from April 2011 results would be published in the CRC league table and these would influence the organisations’ future energy costs and financial reimbursements or fines which would be determined by performance.
The restructured CRC means that the scheme has now become a stealth carbon tax due to government’s decision to direct CRC funds back to the Treasury, instead of being redistributed, as originally planned, to the top performing businesses. It is estimated that revenues from allowance sales totalling ?1 billion p.a. by 2014-15 will be used to support public finances rather than going back to scheme participants. However, under the restructuring the burden on businesses will, in the first instance, be slightly reduced by the fact that the first allowance sales for 2011-12 emissions will be pushed to 2012 instead of 2011, giving businesses a deferral of cash flow.
Chris Smith, sales and marketing director at on365, comments that: “I think that CRC now reads ‘Corporate Restraining Charge’. In effect this is now a tax and not an incentive to reduce carbon emissions. Corporate environmental responsibility is now measured in pounds sterling with the carrot to encourage businesses to participate being replaced by a stick.”
