CRC Energy Efficiency Scheme – Survival of the Fittest

Please note: The content of this article is in the process of being updated to reflect the latest CRC scheme design. Updated content will be posted shortly. The Department of Energy and Climate Change (DECC) website contains complete details on program requirements and design.

CRC Energy Efficiency Scheme Represents the Survival of the Fittest

While critics of the CRC Energy Efficiency Scheme cry foul, taxation, government intervention and needless bureaucracy, proponents argue that the weighty legislation represents commonsense. There is undoubtedly a conflict between economic recovery and the need to achieve sustainability in many respects, but in other respects they should be viewed as one. Economic recovery should dictate that efficiencies are put in place to help ensure that such a bad downturn is not a return visitor.

It's difficult to believe that organizations are not aware of the growing threat of climate change and the inevitability that is the rush to sustainability. However, surveys in the UK have shown confusion and lack of awareness, even though the CRC Energy Efficiency Scheme has received considerable publicity around the country.

If carbon emission control is the biggest challenge of the next decade, companies affected by the new UK cap and trade scheme are presented with their own challenges as they struggle to comply.

All organizations directly involved, some 5000 of them, will have been expected to reveal their positions during 2009, look at their energy and electricity use during 2008 and prepare to register and start complying early in the new year. The true weight of the program does not arrive until 2013 effectively, but they may nevertheless encounter fines and restrictions awaiting those who lag behind initially.

Many of the major industrialized nations are watching with keen interest the developments in the UK as the CRC Energy Efficiency Scheme unfolds. The "cap and trade" program will ultimately severely punish those companies that are unable to achieve efficiencies and to balance the need to buy the right to emit carbon with their peers.

Survival of the Fittest: the Carbon Economy Story

The scheme has been called by some the "survival of the fittest," as in addition to the imposition of fines, a failure to achieve comparative reductions will directly increase the cost of doing business for those affected, as well as creating bad media attention.

A lot is at stake as organizations try and recover from the severe economic downturn. As they emerge, they must also be seen to be sustainable and this will in itself require them to take a concerted inward look at their operations. Regeneration is required and those organizations who do not understand this quickly emerging trend will likely not survive.

Will Only the Fittest Survive the CRC Energy Efficiency Scheme?

Two fairly small scale real-life simulations have been staged in the UK to demonstrate the effectiveness of the CRC Energy Efficiency Scheme. As might be expected, numerous different issues have emerged and there are sure to be amendments to the scheme as it rolls forward. This is the case with any far-reaching and innovative legislation, but it underscores the need for the company to be as agile as it can be and ready for anything.

Unless the organization is able to analyze its assets to a very fine degree, it risks being unable to initiate savings through efficiency. In the new world, there will be an even greater premium on quality information and each organization should ensure that it has systems and solutions in place as we go forward.

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