This website uses cookies primarily for visitor analytics. Certain pages will ask you to fill in contact details to receive additional information. On these pages you have the option of having the site log your details for future visits. Indicating you want the site to remember your details will place a cookie on your device. To view our full cookie policy, please click here. You can also view it at any time by going to our Contact Us page.

Financial cost of new CRC commitment revealed

22 December 2010

An analysis of the cost to businesses of the amended Carbon Reduction Commitment (CRC) Energy Efficiency Scheme have been undertaken by hurleypalmerflatt.

The study, by international multidisciplinary consultancy hurleypalmerflatt of its clients from the past two years, shows that while all participating organisations will face considerable cost to their business, those who take a good practice approach to meeting the requirements of the CRC and invest in carbon management stand to lose less money than those only aiming for basic compliance.
The cost of the CRC for a typical organisation with a £1m/year energy spend stands at an estimated £430,000 for those that take a good practice approach to complying with the CRC, while those doing the minimum possible – basic compliance – will see a £640,000 cost to their organisation over the same period, a difference of £210,000.
However, while this sounds like good news for companies going the extra mile, organisations applying good practice are set to lose out more than basic compliance businesses when comparing costs with the original CRC.
In March 2010, hurleypalmerflatt calculated that the CRC would cost basic compliance businesses £280,000 but good practice organisations could receive revenue of £130,000.  Now that revenue recycling has been abolished and all receipts will go to the Treasury, good practice businesses will be £560,000 worse off under the CRC now than predicted in March – whereas basic compliance businesses will be £360,000 worse off.*  
Organisations covered by the CRC must buy carbon credits annually to cover their expected carbon emissions and will be listed in a league table showing the best and worst performers. Companies which invest in carbon management and reduce their emissions will need to buy fewer credits, will perform better in the league table and will have to pay the Government less than others.
“Many now see the CRC as a green tax by another name.  However, our analysis shows even though there will be costs to all it will still pay businesses to invest in good carbon reduction practice,” explains Stuart Bowman, Energy and Sustainability Director, hurleypalmerflatt.  
“Companies need to understand the new CRC and approach it well.  We are in an era where sound environmental practice makes commercial, as well as ethical, sense – it is just frustrating that those organisations approaching carbon reduction in a comprehensive way will not reap the rewards that they would have before.”  
hurleypalmerflatt’s analysis also examined different organisations by type and energy spend.  It shows, at the extreme, that the cost of the changes to businesses with very large energy spend could be over £100m between now and 2017.
*hurleypalmerflatt’s figures are based on an indicative scenario of how the CRC may develop.  It is undiscounted and excludes investment and savings associated with energy/carbon-efficiency measures. Actual results will depend upon a complex set of factors and could vary from those given here.

 


Contact Details and Archive...

Print this page | E-mail this page

https://www.fsifm.com/en-gb/
http://edition.pagesuite-professional.co.uk/Launch.aspx?EID=ad48cc47-3ecd-4d64-b5c8-3fa0a72b486d


MOST VIEWED...

View more articles
Article image

Why the Law Says You Need a Nappy Bin Disposal Service

At home, parents are used to disposing of their babies’ used nappies the same way they do any other domestic waste - bagging it up and sticking it in the r...

Benchmarking maintenance

BSRIA has just published this year's operation and maintenance benchmarking report as a guide for building operators to evaluate their performance against ...
Article image

Shaw Contract introduces 'In Stock UK' for fast turnaround projects

As businesses are emerging from lockdown, leading carpet tile and resilient flooring supplier Shaw Contract has launched its ‘In Stock UK’ programme with a...
Article image

EXCLUSIVE Inside Canon UK's environment-friendly building in Reigate

At Canon UK sustainability and FM are inextricably linked. PFM visited the Woodhatch site in Reigate to report on the effectiveness of this approach....
Article image

Emergency Department porter awarded BEM for Covid-19 efforts

Terry Allen, who works for Interserve as an Accident and Emergency (A&E) department porter, has been awarded a British Empire Medal in recognition of his w...
Article image

BIFM becomes IWFM

Following a change of identify, the British Institute of Facilities Management (BIFM) is now known as the Institute of Workplace and Facilities Management ...
https://www.uhubglobal.com