The UK’s Department of Business, Energy, and Industrial Strategy (BEIS) has announced that a standalone Emissions Trading Scheme (ETS) will run in the UK after Brexit, replacing the European ETS in the UK. The objective is to initially shadow the EU ETS but eventually tighten it in order to achieve the “net zero by 2050” policy that the UK has adopted, with the initial cap already set lower than the EU level. BEIS’s press release is here and the relevant document, which is a response to a previous consultation, is here.
This article on the Current +/- web site reports that the UK is considering linking the scheme to the EU ETS. This has been welcomed by Energy UK in this press release. However, this article on the Reuters web site reports that the EU is resisting such a link, unless certain safeguards on potentially adjusting climate targets were in place.
The UK’s Committee on Climate Change (CCC) has written this letter to the government about the proposed scheme, making several recommendations, including a further tightening of the caps and the effective setting of a price floor. The letter is also reported on the Argus Media web site here.