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Friday, 29 June 2012

CRC Energy Efficiency Scheme – Stiff Penalties for Failure to Comply

Civil penalties totalling £99,000 for non compliance with the CRC Energy Efficiency Scheme (CRC) have been imposed on 4 errant companies, reports CMS Cameron McKenna.

The companies, who are participants in the CRC, failed to provide prescribed reports on time.

You might not end up in the Tower, but the penalties for non-compliance might take some people by surprise (even if, by and large, they are likely to be borne by big corporations who can probably afford it).

The highest penalty was £41,000 and the lowest was £10,000.

Failure to provide a report attracts a fixed penalty of £5,000 and publication of the failure.

Where the report is provided less than 40 days after the due date, a penalty of £500 can be levied for each working day the report is late.

After 40 days a financial penalty of £40,000 may be applied.

For annual reports, where the report is provided more than 40 days after the due date (or not at all), further penalties may be levied including a doubling of CRC emissions (which then increases the allowances that have to be purchased).

Camerons report that on this occasion the highest penalty was £41,000 and the lowest was £10,000.

Penalties are applied by the administrators of CRC (the Environment Agency, SEPA and NIEA respectively).

The administrators have discretion to waive or modify a civil penalty, such as when an offender takes all reasonable steps to comply, or to rectify the failure as soon as it came to its notice.

Some discretion was apparently exercised in the latest cases.

Annual reports must be submitted by 31 July 2012 for the reporting year 2011/12 and participants must also surrender adequate allowances.

Camerons say that participants will be treated as compliant with their 2011/12 surrender obligation providing the Environment Agency receives a valid order for sufficient allowances including payment of cleared funds by 31 July 2012 and sufficient allowances are surrendered by 28 September 2012.

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