CRC scheme in the Chancellor's Autumn statement 2012

A huge thank you to Ian Gregory from University of Birmingham for producing a summary of the CRC text taken from the Chancellor's 2012 Autumn Statement. He hopes this will ultimately allow more of our resources to be spent on reducing energy use rather than counting carbon. 

1.127 The Government will simplify the Carbon Reduction Commitment (CRC) energy efficiency scheme from 2013, providing very significant administrative savings for businesses in the scheme. The CRC’s Performance League Table will be abolished, to simplify the scheme further. A full review of the effectiveness of the CRC will be held in 2016

Carbon taxes

• 2.86 Carbon price floor – The Government intends to introduce an exemption for electricity generators in Northern Ireland from the carbon price floor, subject to discussion with the European Commission.
• 2.87 Carbon Reduction Commitment (CRC): simplification – The Government will simplify the CRC energy efficiency scheme from 2013 and the Performance League Table will be abolished. The Department of Energy and Climate Change will publish details of these simplifications. The Government will review the effectiveness of the CRC in 2016. This review will consider whether the CRC remains the appropriate policy to meet industrial energy efficiency and carbon reduction objectives, and will consider alternative approaches that could achieve the same objectives. The tax element of the CRC introduced at Spending Review 2010 will be a high priority for removal when the public finances allow.
• 2.88 Carbon Reduction Commitment: allowance price – The forecast allowance price remains unchanged at £12 per tonne of carbon dioxide in 2013-14 and £16 per tonne of carbon dioxide in 2014-15. From 2015-16 onwards, the allowance price will increase in line withthe RPI. (36)

Long-term certainty for energy

1.82 The Energy Bill, published in November 2012, will provide certainty to investors to bring forward up to £110 billion of investment in new infrastructure to meet the UK’s future energy needs. The Government’s Gas Generation Strategy will set out its view of the expectedrole for gas in the coming years. The Government expects up to 26 gigawatts (GW) of new gas capacity could be required by 2030 on current carbon budgets. If the fourth carbon budget is revised upwards and emissions reductions are more gradual, then up to 37 GW of new plant could be required. Support available for low carbon electricity investment through the Levy Control Framework up to 2020 will be capped at up to £7.6 billion per year (in 2012 prices) in 2020-21 – more than triple the £2.35 billion available in 2012-13. This will allow generators from both renewables and gas to invest with confidence and provide protection for consumers. 

1.83 To maximise economic production from UK natural gas resources, the Government will also establish an Office for Unconventional Gas. This will join up responsibilities across government, provide a single point of contact for investors and ensure a simplified and streamlined regulatory process. The Government will also consult on the tax regime for shale gas.