The workings of the CRC Energy Efficiency scheme were quietly revised yesterday during the spending review. Now, instead of offering "cashback" to organisations that are leading the league tables in energy reduction, the scheme will effectively be a flat taxation system on carbon emissions. The revenue raised will contribute about £1bn to the enormous gaping hole in public finances, and there's no doubt it's needed, but it has changed a scheme designed to reward those prepared to go the extra mile with one where it's more likely that the minimum will be done.
Carbon emissions will simply become a cost of business, to be absorbed like other business costs. And what costs? PwC has calculated that for business with an energy bill of £1m. the loss of incentives will increase costs by around £76,000 per year, increasing to £114,000 per year by 2015.
Yet more SOBER-ing news. (How thrilled was Mervyn King to have come up with that one?)
Edited to add: Chris Huhne defends the change via Businessgreen.com
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