Alfagy launches the fastest way to eliminate CRCs Buy six (6) cogenerators and pay for five (5) offer is launched by Alfagy to help some 20,000 UK organisations cope with the introduction of CRCs. Practical Green Energy™ provider Alfagy Ltd, today announced a new discounting scheme for combine heat and power plants (CHPs) to help CO2 emitting organisation to quickly ready themselves for the CRC scheme in the United Kingdom. Failure to comply will result in mandatory fines that hit the bottom line. The '6 for 5' offer applies to Alfagy's 50 kWe to 350 kWe CHP plants fuelled by gas or wood and ends May 15th 2009. The Carbon Reduction Commitment (CRC) is an innovative climate change and energy saving scheme for the UK. It is expected encourage improvements in energy efficiency that improves finances. The scheme has been designed to generate a shift in awareness in large organisations especially at senior level. The aim is to drive changes in behavior and energy infrastructure. The scheme is also a central part of the UK’s strategy for controlling the country's carbon dioxide (CO2) emissions which are lacking behind projected emmission cuts. It will tackle CO2 emissions not already covered by Climate Change Agreements and the EU Emissions Trading System. This will help reduce the country’s carbon footprint to deliver the ambitious emissions reduction targets set in the Government’s Climate Change Act. The scheme will start in April 2010. The scheme is a UK-wide scheme. Policy has been developed in partnership by the Department of Energy and Climate Change (DECC) and the Scottish Government, the Welsh Assembly Government and the Department of Environment Northern Ireland. Emissions trading schemes such as CRC provide a financial incentive to reduce emissions by placing a price on carbon emissions. In the case of CRC, participants have to purchase allowances equivalent to their emissions each year. The overall emissions reduction target is achieved by means of a cap on the total number of allowances available to the group of participants. However, within that overall limit, individual participants can determine the most cost-effective means to reduce their emissions. Overall the scheme will achieve emissions reductions of at least 4MtCO2 per year by 2020. It is estimated that the benefit to participants will be around £1 billion by 2020. This will result from energy efficiency measures encouraged by this scheme. Revenue recycled back to participants from the sale of allowances each year will also include a bonus for the best performers. In addition to financial incentives, the scheme will provide a reputational incentive as well. Participants will be ranked according to their performance in a league table. This will then be made available for public scrutiny. The combination of financial and reputational incentives will encourage organisations to develop energy management strategies and also generate awareness of emissions at a senior level. As organisations will have to monitor their emissions it will also lead to improved understanding of both energy consumption and opportunities for energy efficiency. Around 20,000 organisations may be affected by the scheme and yours could be one of them. Failure to comply with your obligations will result in penalties including monetary fines. There are proven, fast and cost effective ways to avoid CRC costs and gainrecognition as an energy efficient organisation. Combined Heat and Power
Under CRC, organisations generating on-site electricity using Combined Heat and Power (CHP) can claim electricity credits for electricity exported to other users or to the grid. The electricity grid average emission factor is used to calculate the credits. ■If you own a CHP plant, you must report the primary fuel input to the plant as part of your organisation’s energy use under CRC. However, your use of electricity or heat from the plant would not need to be reported ■All imports and exports of heat from a CHP plant are counted as having zero emissions in CRC. You therefore cannot claim electricity credits for any heat exported from CHP generation ■If your CHP plant is covered by the EU ETS, it will be treated in line with other EU ETS installations as described on previous page.
Renewables
Electricity generation from renewable sources is handled in one of two ways in CRC, depending on whether or not Renewables Obligation Certificates (ROCs) are claimed:
■If you generate renewable electricity on-site and do not claim ROCs, then you do not have to record emissions for any of the electricity you use. If you export this electricity to other users outside the organisation, you can claim an electricity credit at the grid average emissions rate ■If you generate renewable electricity and claim ROCs, you must report the electricity generated as electricity consumption, at grid average emission factor. If you then export this electricity, it is similarly credited at the grid average emission factor –
in practice cancelling out the effect of considering ROC-related electricity as energy consumption. Renewable sources in CRC are those defined under the Renewables Obligation.
Energy from Waste
In line with the general reporting practices proposed for CRC, where waste is used as an input fuel into an energy generation process, a participant will need to report the quantity of waste used, using the waste emissions factor listed in the regulations.
■If you generate electricity from waste to use onsite, you do not need to report this under CRC ■If you export electricity from waste to the grid, you can claim an electricity credit at the grid average emissions rate ■If waste is the primary input fuel in a CHP plant, you must report the waste input in the same way as for other electricity generation processes ■If ROCs are issued for your energy from waste plant this will be treated in line with the treatment of renewables where ROCs are claimed as outlined above.  Download the Department of Energy and Climate Change's CRC User Guide here!  The time line is is not a generous as it may look below. Oragnisations need to start planning now and order equipment and plant to avoid charges and delays. 2009 - Consultation on the CRC Draft Orders
The Climate Change Act contains enabling powers to introduce new trading schemes, including CRC. Government issued a detailed consultation on the CRC Draft Order on 12 March 2009. - Identification of CRC participants
Organisations with half hourly meters need to determine their electricity use for 2008 based on information provided by their suppliers. If their electricity consumption through these meters was greater than 6,000MWh during 2008, the organisation must prepare for CRC. - In September 2009, the Environment Agency – who will administer the CRC – will contact all UK billing addresses with settled half hourly meters providing them with Qualification Packs. All organisations with an HHM settled on the HH market will need to collate information on their total half hourly electricity consumption for 2008 together with a list of their half hourly meters, assisted by their electricity supplier, to assess whether they qualify for the scheme
2010 - Scheme begins with a three year Introductory Phase
The first compliance year (April 2010 - March 2011) is a ‘Footprint’ Year. The first 6 months of the Footprint Year is also the registration period. Organisations who qualify must register or make an information disclosure by 30 September 2010. A monetary fine will be imposed on organisations who fail to do so by the deadline
2011 - Second compliance year
- First sale of allowances takes place in April.
Allowances will be sold to participants at a fixed price of £12/tCO2. Note that this first sale will be unique, as it will be for both 2010/11 allowances and 2011/12 allowances. All subsequent sales / auctions will only be for allowances for the year ahead.
2012 2013 - First capped phase begins
Auctioning of carbon allowances begins
Download the time line illustration here
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