CRC is ‘short of the ideal’ says Huhne

Energy Secretary Chris Huhne said this morning that the CRC scheme “fell short of the ideal” and added that “given a blank slate, we would do things differently”. And he […]

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By Kelvin Ross

Energy Secretary Chris Huhne said this morning that the CRC scheme “fell short of the ideal” and added that “given a blank slate, we would do things differently”.

And he also unveiled a UK-wide consultation on delaying the start of Phase II of the CRC until 2013.

Speaking at the CBI climate change conference in London today, Mr Huhne became the first member of the government to talk openly about the CRC since changes were made to it in last month’s Spending Review.

He said the principle of the scheme “is sound: saving energy, reducing emissions and improving competitiveness through a clear and transparent nationwide programme”.

But he added that “the implementation fell short of the ideal”.

“We share many of your concerns about the CRC,” he told CBI members. “That is why we have made a commitment to simplify it.”

He was referring the changes made in the Spending Review. Previously, funds generated by the scheme, estimated to be around £1bn, were to be recycled to participants but now they will go into the government’s coffers.

Mr Huhne said: “The decision not to proceed with revenue recycling was a difficult one, taken against a background of unprecedented pressure on the public finances. We had to focus on getting the best value for money – and sending a clearer price signal to participants.”

And he told the conference: “Given a blank slate, we would do things a little differently. But for now, you have my assurance that we will engage with all of our stakeholders to make the scheme work better – for you, and for us.”

He said the consultation published today “will create a window for us to engage in a proper dialogue with participants about what we need to do to improve it [CRC]. We can also reduce the administrative burden on businesses.”

Mr Huhne also revealed that DECC is proposing to exempt over 12,000 information declarers from the scheme. Information declarers are those who have a half-hourly meter yet do not use enough electricity to qualify as a registered participant.

“We now have enough feedback from the first stage of the CRC to remove obligations on information declarers without compromising the scheme’s environmental aims,” said Mr Huhne.