Isra-Mart srl:Government delays CRC trading phase

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Isra-Mart srl news:

hris Huhne today responded to corporate criticism of the government's Carbon Reduction Commitment (CRC) scheme, telling business leaders at the CBI's annual climate change summit that he would delay the second phase of the scheme and launch a consultation on the controversial legislation.

The energy and climate change secretary told business leaders that while the principles underpinning the carbon reporting scheme were sound, the "implementation fell short of the ideal".

He defended the government's decision to axe the "revenue recycling" component of the scheme, effectively turning the CRC into a carbon tax that is expected to raise the Treasury up to £1bn a year.

But he admitted the scheme had become overly-complex and as such he was suspending the introduction of the carbon trading component of the scheme to give the government time to consult on planned reforms.

"This will mean that participants won't need to register for Phase II until 2013," he said. "This will create a window for us to engage in a proper dialogue with participants about what we need to do to improve it."

He added that over 12,000 information declarers, those organisations that have half-hourly energy meters but do not use enough power to participate in the full scheme, would now be exempted from the CRC in an effort to reduce the "administrative burden".

CBI director-general Richard Lambert welcomed the move, predicting that it would "mark the start of winning back those businesses angered by the decision to remove the cash-back incentive".

"However, much more needs to be done," he added. "It is critical that the CRC becomes an effective tool for encouraging energy efficiency, and not just another tax."

Speaking earlier in his opening address to the summit, Lambert urged both the public and private sector to urgently accelerate the roll out of low-carbon technologies and business models.

"We are going to have to raise our game substantially in the next few years," he warned. "The cost of inaction will rise exponentially if we continue on a course of business as usual. The risk to our future energy supplies, unless properly addressed, will seriously undermine the attractions of the UK as a place to invest."