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Spending review 'will increase demand for energy efficient technologies'

Demand for energy efficiency technology set to soar as UK firms face impacts of Government's changes to carbon legislation, says Sabien Technology.
Spending review
The Government's changes to the Carbon Reduction Commitment Energy Efficiency scheme (CRC), announced in last week's Comprehensive Spending Review, mean that the scheme will be redesigned. The result is that the participants' cost for each carbon emission will not be reimbursed to top performers. Instead, all monies will go straight to the Treasury, generating £1bn a year.
Alan O'Brien, Sabien Technology chief executive, commented: 'CRC participants were not expecting this. Many of the 3,000 plus participants will need to revisit their CRC strategies as the cost implications become apparent.
'In one fell swoop the cost of the CRC has rocketed. For example, one of the UK's largest retailers is claiming the CRC cost for their organisation has now increased from £10m to £20m a year. Some of the early action metrics organisations have invested in become less important as participants accelerate the implementation of energy efficiency technology.'
Previously, the scheme was revenue neutral for the Treasury and the cash would have been redistributed among UK businesses and local authorities who demonstrated the greatest reductions in carbon emissions and their position in the league table.
The CRC is now a tax burden, according to Sabien. It believes that many of the participants will need to revisit their cash flow forecasts, budgets and timelines to deliver the energy efficiency initiatives and that minimising these unexpected financial impacts is a priority.
Mr O'Brien added: 'The need to reduce energy consumption will now be firmly in the sight of the finance directors, with increasing pressure and demand being placed on the Energy Managers to deliver cost effective initiatives to reduce emissions. Organisations will now need to re-budget in light of the CRC changes and begin to source proven technologies that deliver the greatest level of savings with the quickest paybacks.
'Many of the UK energy efficiency technology providers, us included, will benefit from the changes as participants require proven technology and services to reduce these unbudgeted costs.'
29 October 2010


By Gary Walklett
29 October 2010 01:01:00
As a supplier of energy saving sub metering we hope this article proves to be correct. My concern is how will the private sector find the money with the Banks not lending?
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