This is going to hurt: carbon cuts will bring the pain

Institutions warned to make 'urgent preparations' for energy efficiency scheme. Hannah Fearn reports

March 4, 2010

Universities have been warned that getting to grips with a new carbon-reduction scheme, the first stage of which comes into force next month, will be a "hideous" process.

The CRC Energy Efficiency Scheme (formerly known as the Carbon Reduction Commitment) places a legal obligation on all institutions using more than 6,000 MWh of half-hourly metered electricity - which equates to an electricity bill of £1 million a year - to buy carbon credits to cover their emissions.

All those covered by the commitment will have to register and provide an annual report on their emissions to the Government, even if they fall below the consumption threshold.

Revenue from "carbon auctions", where carbon credits will be traded between the scheme's participants, will then be redistributed according to output levels.

The CRC is expected to cover most universities, and affected bodies must register with the Government by April, reporting their emissions from 2010-11 onwards, or face financial penalties.

Claire Brook, an environmental lawyer at Dickinson Dees, said universities should start gathering accurate data about their carbon output now to minimise the pain.

"The regime is going to take a huge amount of resources and they have to buy allowances upfront," she said. "The quality of data is going to be really important."

Carbon allowances will be available to purchase from April 2011 and it is proposed that institutions will be able to trade their allowances from 2013 onwards.

Emma Fieldhouse, environmental manager at the University of Leicester, said the project will be costly as institutions will have to buy carbon allowances upfront.

"For us, this will mean a payment of £500,000 in 2011, which has made senior managers take a breath," she said.

The CRC, which will also cover businesses, will result in a national league table showing which participants are cutting their carbon emissions the fastest.

However, the Environmental Association for Universities and Colleges (EAUC) is worried that universities will prop up the table and may incur penalties as a result.

The body also warned that the measurements used in the scheme may unfairly penalise universities for having buildings such as libraries that do not generate revenue.

It has called for a separate league table for higher education.

"The big corporate and blue-chip participants will possess far greater resources to achieve efficiencies through investment. A more obvious comparison of institutions would be more effective," said Sarah Lee, EAUC Scotland project officer.

Estate managers at Sheffield Hallam University, which participated in a CRC trial, said the sector faced a shock if it did not make "urgent preparations" for the change.

Marie May, community, sustainability and residential development manager at Sheffield Hallam, said that for institutions that had not taken part in the trial, "it's going to be hideous on the first day".

She said: "We had to think strategically. We not only had to measure the carbon that we've got, but we had to buy the number of tariffs that we thought we would need."

hannah.fearn@tsleducation.com.

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