Ed Davey promises to reduce cost of CRC tax on firms by two thirds
Government is set to cut the administrative cost for companies that fall under its CRC carbon tax by two thirds. "We have listened to businesses' concerns", said energy secretary Edward Davey.
In a consultation launched today the department of energy and climate change said the simplification package will include:
Shortening of the CRC qualification process.
Reducing the number of fuels covered by CRC from 29 to 4.
Reducing the amount of reporting required by businesses.
Reducing the length of time participants will have to keep records.
Removing the requirement on facilities covered by Climate Change Agreement or EU Emissions Trading System installations to purchase CRC allowances.
Adopting new emissions factors for the CRC which will align it with Greenhouse Gas reporting processes.
Removing the detailed metrics of the Performance League Table from legislation and placing them in government guidance.See the consulation here.
By Caroline Pitt, Director of Carbon Services, Utilyx
Statement: We welcome the aim of the consultation which is to simplify the CRC and agree that many of the ideas suggested would make a real difference to the costs of compliance. For instance, being able to use actual billing data, even if it does not match the CRC compliance year exactly, could save considerable time and reduce room for confusion.
However, this particular piece of legislation is one that has already been extensively consulted on and has changed significantly since its initial concept. Participants have invested considerable time in understanding the rules as they now stand and adding a further layer of consultation at this stage will inevitably create additional work, however good its intention. It s vital that the scheme s rules are workable for businesses if they are to be effective in the long term. Simplification is certainly a step in the right direction but it s important that the next steps for the CRC are agreed on quickly and decisively.
By Henry Le Fleming, carbon reporting specialist, PwC
Statement: "The consultation confirms many of the issues that have surfaced over the past twelve months. The reduction in fuels won't affect the overall impact of the scheme in reducing emissions or removing companies from the scheme.
"At a policy level both some form of emissions reporting and increased incentives to reduce emissions will still be in place. The open question is whether there is a need for a CRC league table and mandatory carbon reporting. Which ever option is chosen, providing a robust, clear assessment of the performance of companies can add additional incentive to reduce emissions."
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