The CRC is a mandatory carbon trading scheme that will affect most businesses with an electricity bill of over £500,000 in 2008. The CRC is not sector specific, so it will potentially cover a wide range of businesses including large corporates, financial institutions, retailers, office-based businesses, hotel and leisure groups, logistics companies and real estate firms.
Organisations that qualify for the scheme will be obliged to purchase carbon allowances to cover their total annual UK energy use. The CRC is likely to have significant cost implications for all qualifying organisations and failure to comply could lead to hefty fines, reputation damage and even director liability.
Registration for the CRC begins on 1 April 2010 and the majority of companies will need to have registered by the end of June 2010. Compliance will require document preparation so early planning is essential.
Mayer Brown has been working with clients over several months to develop a number strategies for optimal participation in the scheme. Careful business analysis and management in line with the new legislation could potentially result in multi-million pound cost savings. It is vital to act as soon as possible in order to maximise these potential savings.
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Mayer Brown International LLPMichael Hutchinson
Tel: +44 20 3130 3164