Carbon Reduction Commitment (CRC)

On 1st April 2010, the government’s CRC (Carbon Reduction Commitment) Energy Efficiency legislation came into effect.  The legislation applies to companies with at least one electricity meter settled on the half-hourly market. Organisations that use more than 6,000 megawatt-hours of half hourly metered electricity in 2008, equivelant to an electricity bill of about £500,000, will be required to participate in the scheme.

Participants’ emissions are used to rank them in a publicly viewable League table and they are expected to reduce their emissions year on year.  The CRC legislation includes civil & criminal charges for non compliance.

By developing a CO2 reduction plan incorporating Solar PV generated electricity companies can:

  • reduce their electricity costs, which will be increasingly important as energy costs escalate over time;
  • create a commercial opportunity to sell excess production for a higher premium than the Government’s “Export Tariff”;
  • demonstrate their commitment to their corporate environmental objectives;
  • protect their corporate reputation;
  • avoid CRC financial penalties;
  • allow customers to identify & select low carbon suppliers of goods & services.

This allows participant companies to gain competitive advantage.

Examples of Business use of renewables:

  • Analysts at a major high street retailer, that spent £70m on electricity in 2009, predicted that their electricity costs will increase to £120m over the period 2010 – 2020.  Their solution to manage this cost increase was to install Solar PV where ever possible on their stores’ roofs.  This is part of their “Plan A”.  Source: Ray Noble, Renewable Energy Association.
  • An EU wide meat packer with a turnover of >£500m has a site in Huntingdon which consumes £1m of electricity a year.  They have 3000m2 of roof area over three factories which could be used to install Solar PV.  To do this will cost approx £1.4m and will produce an income of approx £140k a year resulting in payback of investment in approximately 8 years & an annual ROI of 10%.
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