Jurisdiction: United Kingdom
Commencement: 1st January 2025
Amends:
- The Greenhouse Gas Emissions Trading Scheme Order 2020
- The Greenhouse Gas Emissions Trading Scheme Auctioning Regulations 2021
Mini Summary
Following the UK’s exit from the EU, this Order establishes a UK Emissions Trading Scheme (UK ETS) covering greenhouse gas emissions from power and heat generation, energy intensive industries and aviation.
The Greenhouse Gas Emissions Trading Scheme Auctioning Regulations 2021
The UK Emissions Trading Scheme (UK ETS) implements the principals of emissions trading by allocating and trading greenhouse gas (GHG) emissions allowances to participants of the scheme. These Regulations set out the legal framework to allow auctioning of emissions allowances.
Duties
Various duties apply and are available to view on the Legislation Update Service.
Amendment
The Greenhouse Gas Emissions Trading Scheme Order 2020
The UK ETS Order is updated to:
- reduce the number of allowances that can be created and the number available for free allocation for installations;
- create a ‘flexible reserve’ of allowances which can be used to top up free allocation for current installations;
- cover flights from Northern Ireland to Switzerland;
- apply The Greenhouse Gas Emissions Trading Scheme (Amendment) (No. 2) Order 2023 (a previous update) to Northern Ireland.
This Order also make changes to civil penalties as well as making small corrections and clarifications.
The Greenhouse Gas Emissions Trading Scheme Auctioning Regulations 2021
The allocation of carbon emissions allowances may now include allowances provided from the flexible reserve created by this Order.