As we enter the final reporting year for the CRC Energy Efficiency Scheme, businesses will be watching for the publication of the replacement reporting regime, to take effect in 2019. The consultation closed in January this year, and BEIS hopes to publish a decision on the new framework before the summer recess at the end of July.
The Treasury has published increased CCL rates from April 2019, to replace the income stream that the CRC currently provides. Therefore, a significant cost increase in CCL is on the way, whether or not you are currently part of the CRC. It is the new reporting element that is still to be finalised.
At present, many companies are required to report their energy and carbon emissions across a number of mandatory intersecting regulatory schemes, including the CRC, the Energy Savings Opportunities Scheme (ESOS), and Mandatory GHG emissions reporting. The Government’s aim is to reduce the administrative cost and burden on businesses by simplifying requirements and reducing scheme overlap while combining elements of schemes to improve effectiveness.
Indications are that the new framework will include transport, as well as gas and electricity. This inclusion of scope 1 and scope 2 emissions would bring the requirements into line with both ESOS and Mandatory GHG reporting. There are no plans to change Climate Change Agreements or ESOS, although information on ESOS outputs could be included in the new streamlined reports for information purposes. The purpose of this would be to encourage companies to treat energy efficiency recommendations seriously, as the impact that sustainability has on shareholder investment decisions continues to grow.
A number of options have been suggested as the basis for eligibility, which include the existing large companies criteria for ESOS, or the CRC eligibility criteria.
With the final reporting year for CRC now underway, if you are part of Phase 2 of this scheme, your organisation will still need to submit a:
- Final report submitted by 31st July 2019 to cover April 18 to March 2019
- Final payment for CRC compliance allowances in September 2019
- Final surrender of allowances in October 2019
Although the government has announced that 2018/19 is the final CRC reporting year, the relevant legislation has not yet been amended. Therefore, there is still a requirement to register for Phase 3 if you qualify for the next phase. The Environment Agency suggests waiting until nearer the date for registration, but at present, it remains a legal requirement.
