Although the chancellor made no mention of it in his speech on the Public Spending Review, the revenue recycling element of the CRC has been dropped. In a press release issued by the Department of Energy and Climate Change, it was announced that the revenue would instead be used to support the public finances. The statement suggests that it will be invested in projects including "spending on the environment", although the £1bn it is predicted to raise would be a welcome contribution to the budget deficit.
This effectively converts the CRC to a stealth carbon tax and throws into doubt the validity of the early action metrics designed to earn a higher place in the league tables and a higher incentive payment.
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