Up To 5,000 Firms Could Face CRC Fines Next Week

Around 5,000 businesses and public sector organisations have yet to register for the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme, according to on365, an infrastructure and utility specialist. With the deadline looming at the end of next week, fines of up to £45,000 on each organisation could be levied.

A further hazard is that the Environment Agency’s application process and checks take up to four weeks. That means that companies applying today could still miss the cut-off date. Companies failing to submit in time face an immediate £5,000 fee and an additional charge of £500 per day, capped at £45,000.

Compliance Can Be Simple

The CRC Energy Efficiency Scheme was launched in April 2010 and is a mandatory energy-saving and carbon-emission reduction scheme for the UK. It aims to ensure organisations contribute to national emission reductions of at least 34 percent, based on 1990 levels, by 2020 through improved energy efficiency.

During the registration period, firms have had repeated warnings to get their details into the system in time, but apparently many still have not done so.

Chris Smith, sales and marketing director at on365, commented, “The monetary penalties of missing the deadline could be financially crippling for a number of CRC eligible businesses, and to add to this, the reputational damage from a company being listed as non-compliant could be irreversible.”

Smith added that compliance can be simple by basing an initial tier of efficiency measures on changing workplace behaviour. Actions such as encouraging employees to switch off lights and computers overnight can make significant energy savings for minimal effort.

Even without the fines, compliance could cost each organisation around £60,000 to fulfil the entry level requirements alone. There is a claw-back clause for best-performance companies in that a bonus payment will be made to organisations holding the top places in the league table that will be drawn up.

It is regulations such as this that have sounded the alarm for companies considering opening data centres, as pointed out by eWeekEurope in August. CRC compliance and the government’s recent energy statement suggesting businesses’ bills could rise by 43 percent by 2020 may actually discourage suppliers of cloud service, a growing and lucrative industry, from locating their businesses in the UK.

In addition, the possible introduction of Energy Metering may add to the bill if the costs have to be picked up by the customer rather than the energy company or the government. The answer to this will not be known until Ofgem finishes its tests and decides on a policy next year.

Green IT Could Be The Answer

Jacqui O’Keeffe, a partner at Howard Kennedy, a London solicitors firm, wrote in an article for The Datacenter Journal that data centres allegedly use up to 50 times as much power as an equivalent office. She quotes technology industry body Intellect which stated that the average data centre annually consumes the same amount of energy as 25,000 households.

O’Keeffe does see that a change of thinking may turn things around. She wrote that data centre groups and Intellect are in talks with the Department of Energy and Climate Change (DECC) to see if an alternative to CRC can be found for data centre operations.

She moved on to say: “Then there’s the growing number of green data centres. For example, Telehouse Europe obtained planning permission in 2009 to build Telehouse West, a nine-storey, 19,000-square-metre data centre in the middle of London’s Docklands. The $125 million data centre will export waste heat for use in nearby homes and businesses.”

This could provide up to nine megawatts of power for the local neighbourhood and be an added source of income for companies like Telehouse.