Government ‘intends to remain in the EU ETS until 2020’

The UK government intends to stay in the EU Emissions Trading Scheme (EU ETS) until the end of 2020, according to Minister of State for Energy and Clean Growth Claire Perry, speaking to the House of Lords EU Energy and Environment Sub-Committee. 

There has been much debate as to whether the UK will continue to participate in the EU ETS once the UK leaves the EU. The Committee said that there had been concern over the lack of clarity from government – particularly given the financial implications for the businesses in the scheme who need to make decisions on what to do with their allowances.

However, at an evidence session in March, the Minister stated that the UK is seeking to participate in the scheme at least until the end of Phase 3 in 2020. A senior official from the Department for Business, Energy & Industrial Strategy (BEIS) explained that the section of the draft withdrawal agreement that relates to the EU ETS was not marked as ‘agreed’ because the parties were still working through the details of how this would work during the transition period.

Lord Teverson, Chair of the Sub-Committee, welcomed the commitment, adding that: ‘It’s now imperative that the government agrees the specifics with the EU as soon as possible, and then quickly moves on to setting out its plans for carbon pricing and funding action on climate change post-Brexit.’

Perry has subsequently said that BEIS would be seeking the advice of the Committee on Climate Change (CCC) on the implications of the Paris Agreement on climate change on the UK’s long-term emissions reduction targets. The Paris Agreement includes an ambition to limit global warming to 1.5°C, and certainly to limit this to 2°C.

The CCC’s latest analysis of policy on climate change concludes that the government’s Clean Growth Strategy does not go far enough, with action urgently needed to flesh out current plans and proposals and to implement additional measures to meet legally binding carbon targets.