Carbon Reduction Commitment

(CRC)Matthew Croucher

SMMT3 May 2009

Contents

• What is the CRC?

• Are you covered by it?

• Timeline of the scheme

• Key industry concerns over the scheme

• The franchise/dealer issue

• SMMT action

Simple scheme to cut CO2

• For those outside CCA and EU ETS

What is the CRC

• Encourage energy efficiency and lower emissions

• Cap and trade scheme

• Have buy allowances to cover emissions used (at auction)

• Annual reporting – performance in league table – public

• Revenues recycled based on position in table (+/-50%)

• Takes account of growth

• Has a 3 year introductory phase

• Comes into effect in April 2010

CRC – are you covered?

• Covers organisations

• Organisation – NOT site/group

• Do have half-hourly electricity meters?

• Do they consume 6,000MWh (>£500,000)

• If in scheme, then all energy must then be included

• Energy covered by CCA/EU ETS not in scheme

• Exemptions for CCAs (if 25% subsidiary in CCA)

• VMs to take responsibility for dealers

CRC – timeline

SMMT’s key concerns

• Does not appear a simple scheme

• Dealers – burden on VMs, but they have little control

• Definition of organisations – knowing legal structure

• Impact on cash flow a concern

• Introductory phase needs to be more ‘lenient’

• Difficult to gauge how much of sector will be covered

• Difficult to ascertain how sector will perform relatively

• Could impact adversely on electric car demand?

Dealers

Change definition of ‘franchise’

‘Does so exclusively under a trading name provided by the franchisor’

SMMT action

• SMMT wrote to Ed Miliband requesting meeting

• SMMT meet with DECC on dealer issue• Revised definition of franchise

• To respond to consultation – 4 June

• CBI to include our franchise definition in their response

• To follow up with DECC on dealer issue, and involve BERR

• To work with RMIF on dealers energy efficiency• Carbon Trust funded voluntary programme

• To undertake another awareness campaign with members

For further detailsmcroucher@smmt.co.uk

020 7344 1640

Any questions?

http://www.defra.gov.uk/environment/climatechange/uk/business/crc/index.htm