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Local authorities are still failing to adequately prepare to meet the new Carbon Reduction Commitment from April, which could see them fined, says Sunil Shah. The Carbon Reduction Commitment (CRC), the mandatory emissions trading scheme, begins in April this year, yet local authorities are failing to adequately prepare or are still ignorant of their obligations. The legislation covers both private and public sector organisations with an electricity consumption of 6,000MWh or more a year, roughly equivalent to an annual energy bill of £500,000. DPP recommends that local authorities adopt the following approach in preparation of the Carbon Reduction Commitment: Stage 1: mobilisation Organisational review to understand liabilities and readiness, mapping out and engaging with all stakeholders involved in delivering the legislation. Engagement with education bodies will be critical, as it will be the local authority which will hold responsibility for energy efficiency in schools and colleges. Stage 2: strategy Identify the organisational requirements and which parts of the authority comply. Develop a strategy capturing key needs, business case, costs and early action measures which can be taken, 2008 inventory of half-hour meters, date systems and communications approach. Stage 3: implement early actions Implement measures that can be taken to obtain the early action credits. Send through a list of the relevant meters to the Environment Agency to ensure calculations and payments are only made on those meters used. Collate additional registration details and data in advance of completing the forms. Stage 4: forecast, monitor and projects Complete the relevant registration forms. Forecast and monitor carbon emissions over a six-month period to assess accuracy of the model developed. Identify a series of projects to test the system and the calculation methodology using a robust system to understand and capture savings. Qualification into the scheme is based on electricity consumption in 2008, with organisations purchasing carbon emission allowances based on average total energy consumption during the year April 2010 to March 2011. From April 2013, allowances will be allocated by auction, with a diminishing number of credits available over time. Most private sector organisations have understood the threats and are well advanced in their preparations. However, our experience at DPP suggests that, while many local authorities, fire and police authorities, hospitals and schools will fall within the remit of the CRC, little has been done to effectively incorporate the requirements at a strategic level. Cost-effective savings of 20% to 30% could be made immediately by energy conservation in local authority buildings, but there seems little inclination to deliver these immediate savings. Apart from the statutory requirement to reduce carbon emissions, local authorities have very good reasons to act early. A CRC league table will rank organisations, and those which are highly ranked will receive a bonus payment, with poor performers being penalised – a charge that will no doubt be passed on to local taxpayers. In its first year, the league table will rely exclusively on ‘early action metrics' to determine the bonus/penalty amount organisations receive. Such early action metrics include certification against the Carbon Trust Standard or voluntary automatic meter readings which capture, store and retrieve data at half-hour intervals. Last month, the Government announced further measures to assist, and make it easier for public sector bodies to achieve this early action metric. More than £80m of funding has been made available to the public sector to help reduce energy consumption, together with significant help through the ‘Save to spend' Salix Funding programme, which has provided a robust approach (see page left) to calculating and reducing emissions with funding for capital equipment. Yet a lack of resources and skilled personnel has meant that many authorities have not utilised effectively this benefit, or worse, have received funding but have not used it. With this level of financial and commercial support, there is little excuse for inaction, and for not meeting the targets. In addition to the CRC, local authorities are also required to measure their CO2 emissions under National indicator 185, a framework of performance measures set by central government. Failure to show decreasing emissions under both National indicator 185 and the Carbon Reduction Commitment have the potential to seriously damage the reputations and funding availability of local authorities and public sector bodies. For many authorities, the cost savings generated would easily off-set the short-term involvement of a consultant or energy manager. At DPP, we estimate that savings of between 20% and 30% could be made immediately by simple energy-efficiency measures within local authority buildings, but there is often little inclination to deliver these savings. There is also the danger that implementation within local authorities will be bogged down in red tape as they struggle to align their carbon-reduction strategy with existing asset-management and capital investment approaches. Sunil Shah is head of sustainability at DPP, a firm of planning and sustainability consultants

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WHITEHALL

Local government 'is failing' on the CRC

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