Carbon Reduction Commitment (CRC)

Many UK organizations will find that they fall under the new Carbon Reduction Commitment legislation (now known as the CRC Energy Efficiency Scheme). With IT constituting a large part of many organizations’ energy usage, a well thought out, measurable and actionable approach to data center power management can bring major benefits visible at the bottom line.

The CRC will become law in the UK in April 2010, and will be compulsory for organizations that have a half-hourly metered electricity usage of 6,000 MWh as measured between January 1st and December 31st 2008 - or in 2009 prices, an electricity bill of around £500k. All organizations that fall in to this group should have been notified by the Environment Agency by July 2009. As such, it is impossible for these organizations to do anything now to try and come in under the 6,000 MWh/yr lower limit - but those not yet caught in the net should plan now to try and avoid the widening of the net in the future, and those who have been notified should do everything they can to minimize its impact, or maximize the benefits that can be gained. In its current form, the CRC will impact around the 5,000 largest electricity users in the UK.

In essence, every organization will need to measure its energy usage, then calculate the equivalent CO₂ emissions, and will need to purchase carbon allowances for the amount of CO₂ created. The money raised from the purchase of allowances will create a centralized pot, from which the incentives for improvement will be made to organizations which make significant reductions in their year-on-year CO₂ emissions.

All organizations will receive some level of repayment against their purchased allowances. However, the CRC will create a “league table” of performance, and the position of an organization within this league table will define how much they get back - and this could be more or less than their initial expenditure. Therefore, the CRC is not based on hard and fast rules of managing carbon reduction across your data center assets, or what CO₂ reductions will result in what payment - each organization is in constant competition with all other organizations.

The biggest risk for an organization, therefore, is in standing still. Organizations that do not make reductions will find themselves considerably out of pocket, and even those who make small reductions are unlikely to get their allowance investments back.

nlyte is offering a free data centre carbon footprint assessment to organizations who may be affected by the CRC. The assessment will provide a vendor independent view of a data centre’s active power utilization based on modeled power and real-time power consumption. The assessment will also provide a real-time view of current and future CRC allowance requirements, enabling organizations to set data centre targets and to manage changes to align with UK CRC allowances.

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