In Parliament >> The gutting of the CRC

14th January 2013

Related Topics

Related tags

  • Reporting ,
  • Mitigation ,
  • Central government



Alan Whitehead, Labour MP and energy and climate change committee member, lambasts the Treasury for gutting the CRC

The chancellor’s announcement in his autumn statement that the government planned to “simplify” the carbon reduction commitment (CRC) energy efficiency scheme received little publicity at the time. But it is a decision that I think underpins a wider Treasury view towards all things low carbon.

The original CRC, introduced in April 2010, was supposed to be an instrument that prompted CO2 savings in those sections of the economy not affected by the climate change levy or carbon trading.

It was designed to reward good CO2 reduction performance by transferring levies from those performing poorly; a public performance league table (PLT) would provide a reputational record. Because of the redistribution of levies from poor to good performers, it was revenue neutral.

It has been apparent from the off that the chancellor doesn’t like the CRC, except in one aspect, which he demonstrated with his first bite at the legs of the scheme in the 2010: CRC levies would not be circulated but go to the Treasury, netting it a handy £1 billion a year. But at least the PLT remained so we could still see who was doing well and who was not.

Now we have further simplification. The PLT is to be abolished, but the levy whereby all CRC participants must pay a “forecast allowance price” of £12 per tonne of CO2, rising to £16 per tonne in 2014/15, to the Treasury continues. And, in a telling passage in the statement, the Treasury has indicated that it would like to remove the tax as well, but will only get round to that when public finances allow.

The stealthy but complete evisceration of the CRC is, I think, a minor scandal, especially since its whole purpose and design has now been removed. But it still produces a good wedge of cash for the chancellor, so perhaps that’s what matters most.


Subscribe to IEMA's newsletters to receive timely articles, expert opinions, event announcements, and much more, directly in your inbox.

Transform articles

Eight in 10 UK business leaders committed to sustainability investment

Despite rising costs and supply chain issues, eight in 10 UK businesses leaders intend to maintain or increase investment in sustainability action over the next two years.

22nd November 2023

Read more

Global temperatures are on track to increase by 3°C above pre-industrial levels this century under current government policies, the UN has warned.

20th November 2023

Read more

More than 40 organisations and businesses have backed IEMA’s campaign to get green skills and training on the agenda at COP28, including Nestle UK, the British Chambers of Commerce, and OVO Energy.

9th November 2023

Read more

Just 1% of the world's largest publicly-listed companies are aligning future capital expenditure with long-term decarbonisation goals, new research has found.

7th November 2023

Read more

The UK government will introduce a new bill requiring the North Sea Transition Authority to run oil and gas licensing rounds every year, the King’s Speech confirmed today.

7th November 2023

Read more

A vastly different energy system is set to emerge by the end of this decade, with almost 10 times as many electric cars on roads, and solar panels generating more electricity than the entire US power system does today.

24th October 2023

Read more

Almost one-quarter of UK companies are increasing the number of green roles within their business, new data from Totaljobs has revealed.

17th October 2023

Read more

Climate change and pollution are having a devastating impact on the world’s water and freshwater ecosystems, which are worth an estimated $58trn (£48trn) in annual economic value.

16th October 2023

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert

IEMA Cookie Notice

Clicking the ‘Accept all’ button means you are accepting analytics and third-party cookies. Our website uses necessary cookies which are required in order to make our website work. In addition to these, we use analytics and third-party cookies to optimise site functionality and give you the best possible experience. To control which cookies are set, click ‘Settings’. To learn more about cookies, how we use them on our website and how to change your cookie settings please view our cookie policy.

Manage cookie settings

Our use of cookies

You can learn more detailed information in our cookie policy.

Some cookies are essential, but non-essential cookies help us to improve the experience on our site by providing insights into how the site is being used. To maintain privacy management, this relies on cookie identifiers. Resetting or deleting your browser cookies will reset these preferences.

Essential cookies

These are cookies that are required for the operation of our website. They include, for example, cookies that enable you to log into secure areas of our website.

Analytics cookies

These cookies allow us to recognise and count the number of visitors to our website and to see how visitors move around our website when they are using it. This helps us to improve the way our website works.

Advertising cookies

These cookies allow us to tailor advertising to you based on your interests. If you do not accept these cookies, you will still see adverts, but these will be more generic.

Save and close