It seems that the British, like the rest of us, like their acronyms. This seems to be especially true when it comes to the thorny problem of climate change. DECC absorbed DEFRA and BERR to put forward a more consolidated front, but however you look at that, the British are certainly blazing a trail within this arena and have passed what is effectively the first legally binding legislation with teeth.

There has been a significant shift in the way of thinking as a consequence of the Carbon Reduction Commitment, born out of the Climate Change Act of 2008 and the result of a unified DEFRA carbon approach to the issue. The Commitment signifies an innovative approach to climate change and energy saving and the enactment of a number of “carbon budgets.”

It is likely that many will seek to mirror the effects of the British government’s novel approach, should the DEFRA carbon scheme be successful. The British government has worked with considerable speed, especially when you consider the traditional constraints of the European Union system.

In a new era, carbon will become a commodity and will have an established price per ton. The British government is at pains to point out that those who are forced to participate in the Carbon Reduction Commitment will enjoy a net financial benefit in this new arena. They maintain a significant incentive will now be available should an organization reduce its carbon emissions.

Those who participate in the UK government’s DEFRA carbon scheme are likely to realize benefits in the region of around $1 billion over the next 10 years or so. The Treasury Department points out that there will be no net revenues to the UK’s version of the Treasury Department as all income will be recycled back to participants.

While the government is ready to encourage and provide financial incentives, in a sense at least, it is not afraid to wield a stick in addition to dangling the carrot. Participants in the DEFRA carbon scheme known as the Carbon Reduction Commitment may face reputational harm if they are not able, for one reason or another, to perform well in terms of carbon reduction. A league table will be published for all to see and judge.

Somewhere in the region of 5,000 organizations across the United Kingdom must actively participate as part of a group of some 20,000 who will be impacted in one way or another. The active group must document their carbon liabilities and purchase a relevant amount of allowances from the government as they take part.

By the year 2050, the UK plans to have made huge reductions in the amount of greenhouse gas emissions across the country. Significant goals are set and commencing in April of 2010, the first goal is to reduce carbon equivalent emissions of at least 4MTCO2 per year within 10 years. This would be a reduction of 26% compared to a 1990 baseline and considered vital in the fight against global warming and climate change.

Daniel Stouffer has a lot of information about DEFRA carbon and how a visit to www.verisae.com will aid you.