DECC: CRC simplification has limits


The Department for Energy and Climate Change (DECC) has stated that it would not be expedient to remove certain aspects of financial administration from the Carbon Reduction Commitment (CRC).

Speaking on behalf of DECC at the Energy Solutions Expo on 11 October, Paul Wilson asserted that “some admin costs, like robust reporting, are there for a good reason, it wouldn’t be simplification to remove them all”. Mr Wilson argued that some of the suggestions to simplify the scheme would undermine its effectiveness. He stated that the CRC had achieved a “major success” in ending the view of “energy as a minor cost”.

The transformation of the CRC program from a revenue neutral scheme to a tax by the Coalition has led to criticism that it places a heavy financial burden on energy users, whilst offering no option for revenue return.

DECC received over 700 responses to a recent consultation on the CRC, which Mr Wilson said had been listened to very carefully. In answer to those who called for the scheme to be scrapped and replaced by something else, Mr Wilson asserted that “the CRC is the best tool for the job” and the impact of the scheme was “bigger than the sum of its parts”. However he accepted that it was necessary to “root out the unnecessary complexity”.

Andy Johnston, Chief Executive of Local Energy, supported Mr Wilson’s concern for robust reporting, stating: “Confidence in data quality is essential; any move to weaken that just makes CRC another finger in the air carbon reporting exercise”.

DECC is continuing to make adjustments to the CRC scheme before the current years reports are due to be collected, beginning in next April.

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