Call to scrap 'unfair' CRC scheme

The UK government should scrap the CRC Energy Efficiency Scheme and instead oblige businesses to reveal more about the amount of carbon they produce, according to Policy Exchange, an independent think tank.

In a new report, Policy Exchange’s environment and energy unit describes the CRC as “an unfair, complex and unnecessary piece of regulation that should be abolished”.

Replacing the CRC with mandatory reporting and a clearer carbon price would help unlock the potential of energy efficiency to deliver savings both in cost in and the amount of carbon emitted, argues the report titled Boosting Energy IQ: UK energy efficiency policy for the workplace.

The study found that climate policies have created widely differing carbon prices across the economy. As a result, it said, a firm inside the CRC will effectively pay five times as much to emit a tonne of carbon using electricity than a firm outside the CRC will pay for carbon emitted using gas.

Policy Exchange, therefore, wants the government could reduce these distortions by abolishing the CRC, which, it said, imposes an unfair tax on certain parts of the commercial and public sectors.