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CRC agenda: preparation is essential

Head of climate change at the Environment Agency Malcolm Fergusson tells cooling firms how to prepare for the CRC scheme

The refrigeration industry is sure to be one the top sectors affected by the CRC Energy Efficiency Scheme, which came into force on 1 April. From high street supermarkets, food processors and distributors through to refrigeration manufacturers, sectors that rely on refrigeration will have to further improve energy efficiency if they want to benefit from the scheme fully.

The CRC Energy Efficiency Scheme is expected to reduce CO2 emissions from about 5,000 participating public and private sector organisations by up to 11.6 million tonnes per year by 2020 - the equivalent to taking roughly four million cars off the road - so this is an important addition to the UK’s policy response to tackling climate change.

The scheme is also expected to save firms money through reduced energy bills - benefiting the economy by more than £1billion by 2020. Therefore it should be seen as a valuable business opportunity for both those taking part and those producing energy-saving technology.

The Environment Agency is working with organisations to help them understand their obligations and will provide as much guidance and information as possible. However, failure to comply with appropriate deadlines or providing inaccurate information may result in civil sanctions and fines.

Compliance with the CRC Energy Efficiency Scheme will require financial, audit and carbon management arrangements to be made by participating organisations. By
planning and preparing for these now, CRC participants will be in the best position to cut their energy bills, reduce upfront CRC payments, increase their revenue recycling payout from the scheme - and polish up their reputation along the way.

Who qualifies for the scheme?
Any organisation that had at least one half-hourly electricity meter during calendar year 2008 qualifies for CRC. If an organisation consumed at least 6,000 megawatt-hours of electricity through all of its meters during 2008 (equivalent to an electricity bill of about £500,000), they will need to register for CRC as a participant. They will then need to monitor energy consumption and, from 2011, buy allowances to cover the tonnes of CO2 they emit.

However, if an organisation consumed less than this amount of electricity, they will register for CRC as an information declarer and make a simple return of information on the electricity that they have used through these half-hourly meters. They will not have to buy allowances if they fall below the energy use threshold.

There are serious penalties for eligible organisations that do not register for CRC by the end of the registration period. A fixed fine of £5,000 will apply. Additionally, a penalty of £500 per day (for a maximum of 80 working days, together with a publication on non-compliance) will apply until they do register. It is therefore essential that qualifying organisations register before 30 September 2010.

On the positive side, participants successful in reducing energy consumption will not only save money on energy bills, they will also receive financial and reputational
incentives. These savings should be well in excess of the costs of participating in the scheme.

Refrigeration and air conditioning can, of course, use a considerable amount of energy, and organisations will have to take this into account if they are to be involved in the CRC Scheme.

What steps can you take?
There are many practical steps that firms can take to make their air conditioning and refrigeration more energy-efficient, such as temperature control, insulation,
cleaning and replacing any old equipment with newer, more energy-efficient versions. But to make big changes, organisations will also have to invest in energy-saving technology.

Some examples of these include, for air conditioning: free-cooling coils; variable speed drives; and better building management systems. For refrigeration, better technologies include: electronic expansion valves; light pressure amplification; heat recovery; adiabatic recovery and improved defrost controls.

The CRC is not only an opportunity for participating organisations themselves to become more energy-efficient - it is also an opportunity for the rac supply chain to reap the benefits by developing the technology and making it available to the businesses that need it.

Organisations have the choice between viewing CRC as a benefit or a cost. The Environment Agency hopes organisations will embrace their role in helping to fight climate change and choose the latter course.

Efficiency in store
Supermarket chain Sainsbury’s will be a participant in the CRC Energy Efficiency Scheme. This means it will have to take steps to be as energy efficient as possible if it is to gain a strong position in the league tables that we will publish.

Sainsbury’s has already made steps to reduce the environmental impacts of its refrigeration. From this summer, all Sainsbury’s developments will have CO2 refrigeration technology fitted as standard, which will cut the company’s carbon footprint by about a third.

Sainsbury’s plans further steps to cut energy use from refrigeration. It has PVC curtains on many chiller cabinets, which cuts the power it uses by about 5 per cent. It also uses chest freezers in many stores, which are more energy-efficient than upright freezers because less energy is wasted. More information: www.environment-agency.gov.uk/crc Dedicated CRC helpdesk: crchelp@environment-agency.gov.uk

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