The Environment Agency has been accused of leaving businesses open to further fines under a new ‘green tax’ by asking companies to register their carbon footprint even if it is not accurate.

By Louise Gray and James Kirkup Published by The Daily Telegraph - 7:00AM BST 13 Aug 2010

From April 2011, firms will need to buy permits for each tonne of carbon dioxide emitted Photo: PA

Earlier in the week the Daily Telegraph revealed that thousands of companies face fines of up to £45,000 for failing to register for the Carbon Reduction Commitment.

The new ‘green tax’ requires business over a certain size to start measuring their greenhouse gas emissions as the first step towards a new carbon trading scheme.

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Ultimately those companies that cut the most carbon will be rewarded while those at the bottom of the league table will face financial penalties that could end up running up to hundreds of thousands of pounds.

But many smaller businesses are already struggling to submit accurate measurements of their energy use and where the fuel comes from.

Now the Environment Agency is telling companies they can register without having to accurately measure their ‘carbon footprint’ in an effort to make more firms sign up to the “difficult and disjointed” scheme.

The email reads: “Do not delay registration even if your information is not fully accurate”.

Rebecca Seabury, from Inenco, the UK’s largest energy analyst, said this runs contrary to the whole point of the scheme, which is to start measuring carbon emissions accurately in order to tackle climate change.

It also leaves companies open to further fines if they get it wrong, once the scheme is up and running from April next year.

Companies found to be putting in inaccurate measurements will be fined £40 for every tonne of carbon dioxide over and above a 5 per cent margin. Again this could run to hundreds of thousands of pounds.

“The move appears to encourage nothing more than rudimentary compliance with the legislation, which contrasts with the central aim of the scheme, to promote proactive management of energy consumption and carbon emissions,” said Ms Seabury.

“If organisations are unable to obtain accurate data on their energy usage at this stage, it’s going to be difficult for them to track their efficiency and make reductions in the future, and unlikely that they’ll benefit from the CRC league table. It also leaves them open to further fines that could run to hundreds of thousands of pounds.”

The Environment Agency insisted that the email was sent out to encourage all companies to register by 30th September and to highlight the help available to businesses that may be struggling.

Anwen Robinson, of Unit4, that advises businesses on environmental law, said the penalties for not complying with the new green tax will soon build up to a “major bill”.

She pointed out that businesses face fines of £5,000 if they do not register in time and then £500 for every day they are over the September deadline up to £45,000.

Even if companies do register in time they will be forced to shell out thousands of pounds if they fail to cut carbon emissions.

And if they supply inaccurate information they are fined £40 for every tonne of carbon outside the five per cent margin.

Finally, there is the threat of fines and even a jail sentence for staff and company executives that knowingly provide the wrong information.

“Businesses are not taking it seriously because they do not understand the impact on their organisation. They need to wake up and smell the roses,” she said.

An Environment Agency spokesperson said: “It is in the interest of companies to be as accurate in their assessment as possible but we have always made it clear that at this stage of the process there is flexibility around in the information that needs to be provided. We will work closely with businesses to aid their registration and encourage organisations to submit the most accurate information they have.”

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