CRC Initial Phase (Phase 2)—issues for property lawyers
CRC Initial Phase (Phase 2)—issues for property lawyers

The following Environment practice note provides comprehensive and up to date legal information covering:

  • CRC Initial Phase (Phase 2)—issues for property lawyers
  • What is the CRC Energy Efficiency Scheme (CRC Scheme)?
  • Brexit impact
  • The CRC Energy Efficiency Scheme (Amendment) (EU Exit) Regulations 2018
  • How does the CRC Scheme work?
  • Landlord and tenant rule
  • Exception to the landlord and tenant rule
  • CRC Scheme costs
  • Drafting considerations checklist
  • Green leases
  • More...

What is the CRC Energy Efficiency Scheme (CRC Scheme)?

The CRC Scheme is a mandatory emissions trading scheme in the UK that aims to cut carbon dioxide emissions and improve energy efficiency in large non-energy-intensive public and private sector organisations. Organisations that qualify for the CRC Scheme have to purchase allowances for every tonne of carbon dioxide they emit.

The CRC Scheme is divided into two phases. Each phase contains a series of annual compliance years. There is a qualification year before the start of each phase, which enables organisations to determine whether they need to participate in that phase of the CRC Scheme.

The first phase of the CRC Scheme (the 'Introductory Phase (Phase 1)') ran from April 2010 to March 2014 and contained different requirements to subsequent phases in the CRC Scheme. The current and final phase of the CRC Scheme runs from 1 April 2014 to 31 March 2019 and, confusingly, was officially named as the Initial Phase. For the sake of clarity, we refer to this phase as the 'Initial Phase (Phase 2)'.

The CRC Scheme was introduced using enabling powers from Part 3 of the Climate Change Act 2008 (CCA 2008) and the primary details of the CRC Scheme were found in the CRC Energy Efficiency Scheme Order 2010, SI 2010/768 (2010 Order), which sets out the requirements for the Introductory Phase (Phase

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