UK's Carbon Reduction Commitment (CRC) Scheme

While the EU has taken a lead role in the global arena in tackling climate change, it looks like UK is taking a lead role in tackling climate change within the EU. UK has promulgated first-of-its-kind domestic legislation on climate change. UK's Carbon Reduction Commitment (CRC) scheme targets any (business and public sector) organization, including any parent company and its subsidiaries, which spends more than £500,000 a year in the UK on electricity. The CRC establishes a domestic carbon trading scheme and requires firms to purchase allowances, initially at a set price of £12 per tonne, in correspondence to the cap on emissions levels imposed on them by Defra (UK Department of Energy, Food and Rural Affairs). Firms that then exceed their emissions cap will have to buy in extra credits to cover excess emissions before surrendering their credits back to Defra at the end of each year, while those that come in under their cap will be able to sell their unused credits

The regulation comes into force in October 2009 and the introductory auction phase starts in 2010. It is expected to save at least four million tonnes a year of carbon dioxide equivalent (CO₂e) by 2020, according to an official at the UK environment ministry.

The UK is thus showing praise-worthy initiative in tackling climate change which is one of the greatest environmental challenges facing the world today. It is hoped that more countries within the EU and elsewhere follow UK's excellent example.