As expected in the UK today, HM Treasury announced massive cuts in the public spending review. What was less expected was a press release about the DECC spending review which contained the following short statement: “Revenue raised from the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme will be used to support the public finances (including spending on the environment), rather than recycled to participants.”

This could have significant implications for the scheme, both in terms of its acceptance within the business community and the expected impact of the legislation as a whole. On the face of it, this statement from DECC looks like it is increasing the cost to businesses of participation in the CRC EES. Without a recycled payment there will be less incentive for organizations to implement early action measures and perform well in the league table, although it appears that the reputational risk of the league table remains. It does mean that carbon emissions will still have a cost and it still means that those organizations pursuing energy management programmes will continue to reduce their operating costs. One could jump to other conclusions, but we really need to see more information from the Government about the future of the scheme.