Despite accusations that the CRC scheme had become too bureaucratic and had been watered down, climate change minister Greg Barker rejected calls to scrap it, arguing that, while DECC will simplify the scheme, the basic requirement for firms to report on their energy use and purchase carbon allowances will remain.
He added that there was already evidence that the 5,000 large organisations participating in the scheme’s first year had taken steps to improve their energy efficiency.
In his submission on 30 June he said: “We have seen the importance of the CRC for stimulating the market for new low-carbon goods and service industries – including in energy measurement, in voltage optimisers and in low-energy lighting.”
The government is proposing to scrap plans to introduce annual auctions of carbon allowances from 2014 and instead host two sales of fixed price allowances each year. The department said that it would formally consult on the new proposals early next year but urged participants to provide feedback immediately.
The CRC has been mired in controversy since its launch in April last year and in October opposition escalated when the Treasury announced it would scrap ‘revenue recycling’, which promised bonus payments to firms that made the greatest energy efficiency improvements.