New framework introduced to replace CRC scheme

The Carbon Reduction Commitment Energy Efficiency (CRC) Scheme will close early. The scheme will be replaced by the Streamlined Energy and Carbon Reporting (SECR) Framework. Furthermore, the climate change levy rates will also increase.

The government said the above combined policy package would provide a new social benefit of up to £1.5bn and will help deliver an energy efficiency boost of 20% by 2030.

Carbon Reduction Commitment Energy Efficiency Scheme
The CRC Energy Efficiency (CRC) Scheme is designed to promote energy efficiency and reduce carbon emissions in the UK.

The ‘first phase’ ran from April 2010 to March 2014 and the ‘initial phase’ runs from April 2014 to March 2019. Organisations that qualify are required to monitor and report carbon emissions and purchase allowances.

The CRC Energy Efficiency Scheme (Revocation and Savings) Order 2018 makes provision for the early closure of the CRC scheme. The ‘initial phase’ will be the final phase of the scheme. Participants who qualified for that phase are still required to comply with their obligations as usual. The allowances for the final year must be surrendered by the last working day of October 2019.

Streamlined Energy and Carbon Reporting Framework
The Department for Business, Energy and Industrial Strategy will introduce the new Streamlined Energy and Carbon Reporting (SECR) framework to replace the CRC scheme.

The SECR framework will continue to apply to all quoted companies and apply to large UK incorporated unquoted companies (with at least 250 employees or annual turnover greater than £36m and annual balance sheet total greater than £18m).

Qualify companies will be required to report carbon emissions and energy use in their annual report, from April 2019.

Climate Change Levy
From April 2019, the Climate Change Levy (CCL) rate will increase to compensate for the loss of CRC revenue. There will be an overall increase of around 50% for electricity and 70% for gas.

Main rate of CCL are below:

CCL rates

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