Parent and subsidiary organisations will be grouped together as one participant for the CRC, under the highest parent organisation. The legal responsibility for compliance with the scheme will rest with the group as a whole, but the highest parent or alternative nominated primary member will be required to liaise with the scheme administrators.
As part of the registration process, organisations will need to identify Significant Group Undertakings – (formally known as Principal Subsidiaries) for example any legally defined subsidiary that would have qualified for the scheme in its own right were it not part of its group. Where a participant so chooses, it will be able to nominate any Significant Group Undertaking (SGU) that it wishes to disaggregate from its group for the purposes of the CRC.
If the SGU consents to this disaggregation, it will be treated as a separate participant for the remainder of the phase and will be required to register and submit the same data as any other full participant. The participant that disaggregated it will not be required to report the emissions of that SGU as well as its own total. However, participants will not be able to disaggregate SGUs if by doing so, it brings their half hourly electricity use to below the qualification threshold of 6,000MWh.
Different rules apply to government departments for disaggregation, which are covered by Machinery of Government in the Government Response and Policy Decisions document, 7 October 2009.
Where possible, the administrators have tried to only send letters and information to the parent organisation. However, where this has not been possible, letters will be sent out to half-hourly meter (HHM) billing addresses. Consequently some orgnisations may receive more than one letter.
Subsidiaries will need to pass details of their HHM electricity consumption to their Primary Member as it is the Primary Member that must respond on behalf of the whole group.
Organisations with non-UK ownernership, are now termed as 'overseas undertakings'. You will need to nominate a UK-based group member to be the organisation’s Primary Member, or employ a proxy or agent to administer your CRC requirements.
Where the total UK half-hourly electricity use exceeds the qualification threshold, the energy use of all the parts of the organisation within the UK (operations and subsidiaries) should be grouped together to form a single CRC participant. For further clarification see guidance on 'Disaggregation'.
Yes. If an organisation is part of a group and one of the members has a CCA, then that member may qualify for a CCA group member exemption. If a member has more than 25 per cent of its emissions covered by a CCA, 100 per cent of its emissions will be exempt from the CRC for an entire phase.
If an organisation has a CCA which covers less than 25 per cent of the total electricity consumption, the energy covered by the CCA will be excluded from CRC but the remaining energy will be included.
This exemption would be granted at the time of registration, on the basis of data collected for the CCA target period ending in the qualification year. An organisation that qualifies for a CCA group member exemption will need to include the following data as part of its registration:
- Total emissions of the exempt group member;
- Total emissions covered by that group member’s CCA.
The other group members will still be included in the CRC, with all remaining emissions counting towards the participant’s total footprint – unless its half-hourly electricity consumption during the qualification period was less than 1,000MWh, after excluding all subsidiaries that qualify for a group member exemption. In this case, the participant would claim residual group exemption and the entire organisation would be exempt from the CRC.
An organisation that qualifies for a CCA residual group exemption will need to include the following data disclosure as part of its registration:
- Total amount of half hourly electricity supplied to the group as a whole;
- Half hourly electricity remaining, after subtracting half hourly electricity use of the exempt group member(s).
For further information concerning CCAs and the CRC, please refer to Chapter 5 of the latest Government Response and Policy to the Draft Order to Implement the Carbon Reduction Commitment.
For the Introductory phase, if you have no CCA data for the Qualifying Year then you will be able to use your Footprint Year data. See Government Response to Consultation.
Where one organisation has a greater than 50 per cent controlling stake in another, those organisations will be classified as parent and subsidiary for the purposes of the CRC Energy Efficiency Scheme.
To determine whether it qualifies for the CRC Energy Efficiency Scheme, the parent will need to aggregate the 2008 half-hourly electricity usage from all of its subsidiaries that it owned on 31 December 2008.
Yes, the electricity generation credit gained by a subsidiary facility can be offset against the electricity consumed by the CRC participant overall. CRC credits gained from exporting electricity to the grid count towards the CRC balance of the whole organisation.
If, over the course of a compliance year, a CRC participant accrues more credits than its total energy consumption, then the energy consumption should be reported as ‘zero’. In other words, a participant cannot report a negative figure for energy consumption.
All electricity credits refer to electricity generated over the course of a particular compliance year and may only be claimed in the compliance year in which the electricity was generated.
The electricity generated by a European Union Emissions Trading System (EU ETS) installation, a nuclear power installation, a pumped storage hydro-station or a hydro-generating station ineligible for a Renewable Obligation Certificate, will not be eligible to claim energy credits under the CRC. For further guidance see Section 4.3 on supply in the Government Response October 2009.
