Immediate fines of £5,000 for failure to register for CRC

Aug. 13, 2010 - PRLog -- Companies must register for the CRC Energy Efficiency Scheme before the 30 September. Failing to register their energy use, they will be hit by fines that could reach £45,000 under the little-know rules. Those that do participate in the CRC Energy Efficiency Scheme initiative by declaring their energy use will face charges for every ton of carbon emissions they produce. These payments are expected to average £38,000 a year for medium-sized firms, and could reach £100,000 for larger organisations.

Missing the Sept 30 deadline will mean an immediate £5,000 fine, and £500 for each day after that, up to a maximum of £45,000. Another 15,000 smaller organisations are also required to register for the CRC scheme and could be expected to buy permits in the future.

Any company or public sector organisation that consumes more than 6,000 megawatt hours (MWh) of energy a year – meaning a power bill of about £500,000 – must register its energy for the CRC scheme. From April, firms will need to buy permits for each tonne of carbon emissions emitted. For those using 6,000MWh, that could mean £38,000.

According to surveys, thousands of businesses are unaware they are supposed to be taking part in the CRC scheme, or even that it exists at all. Of about 4,000 organisations estimated to qualify for the CRC scheme, only 1,229 have registered to date, leaving thousands at risk of fines.

When economists are warning of a “double dip” recession as companies, consumers and the public sector all cut their spending, the imposition of new charges and fines will put more pressure on firms. This has provoked the critic of business leaders towards the CRC scheme, who claim it is “complex and bureaucratic”. They said that the paperwork and costs involved in complying with the CRC scheme could put a significant new burden on companies already struggling in an uncertain economic climate.

Executives and business groups said that the CRC scheme had been poorly communicated and publicised, leaving many companies in the dark. The Environment Agency, which will run the CRC scheme for the Government, has refused even to publish a list of the companies that are required to register.

The CRC scheme, created by Labour but implemented by the Coalition, is intended to create a financial incentive to cut energy use, and those organisations that record the biggest reductions will get bonuses, funded by penalties imposed on those with the worst record. The Coalition is pressing ahead with the CRC despite Conservative pledges to cut red-tape on businesses.

The energy and climate change minister, Greg Barker, who is overseeing the scheme, said yesterday: “I understand the original complexity of the scheme may have deterred some organisations and I want to hear suggestions as to how we can make the scheme simpler in the future.”

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