Jurisdiction: United Kingdom

Commencement: 12th December 2022

Amends:

Mini Summary

The Storage of Carbon Dioxide (Licensing etc.) Regulations 2010 implement EC Directive 2009/31/EC on the geological storage of carbon dioxide. These Regulations provide a licensing regime for the storage of carbon dioxide within the UK’s territorial waters and areas that have been designated as gas importation and storage zones.

Duties

The Regulations provide a licensing regime for the storage of carbon dioxide within the United Kingdom’s territorial waters and areas that have been designated as gas importation and storage zones.

The Regulations prohibit the storage of carbon dioxide in the water column. The Regulations set out the procedure for applications for ‘appraisal’ times and ‘storage permits’. A list is required to be kept of those with permits.

The Regulations put in place requirements for the closure and post-closure plans for those with storage permits.

The Environmental Damage (Prevention and Remediation) Regulations 2009 have been amended so as to include the Directive on Carbon Capture and Storage.

Amendment

Minor technical changes are made to replace references to the EU Emissions Trading System Directive with references to The Greenhouse Gas Emissions Trading Scheme Regulations 2012  and The Greenhouse Gas Emissions Trading Scheme Order 2020.

References to ‘exit day’ are replaced with references to ‘IP completion day’.

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Jurisdiction: United Kingdom

Commencement: 26th November 2021

Amends: UK Retained: Regulation (EU) 2019/631 setting CO2 emission performance standards for new passenger cars and for new light commercial vehicles

Mini Summary

The UK Retained: Regulation (EU) 2019/631 setting CO2 emission performance standards for new passenger cars and for new light commercial vehicles sets CO2 emissions performance requirements for manufacturers of new passenger cars and light commercial vehicles, and premiums to be paid if they are exceeded.

 

CO2 emissions performance requirements are set by the European Commission (EC) for new passenger cars* and new light commercial vehicles* in order to help achieve the European Union (EU) greenhouse gas emissions reduction target and the objectives of the Paris agreement (a global action plan to limit global warming to below 2°C above pre-industrial levels).

*New passenger cars are Category M1 vehicles which are registered in the EU for the first time and have not previously been registered outside of the EU. Category M1 means vehicles for the carriage of passengers with no more than 9 seats, including the driver’s seat, as defined in Annex II of Directive 2007/46/EC establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles.

*New light commercial vehicles are Category N1 vehicles with a mass not exceeding 2610kg and those type approved under Regulation (EC) 715/2007 which are registered in the EU for the first time and have not previously been registered outside of the EU. Category N1 means vehicles for the carriage of goods with a maximum mass of 3.5 tonnes. as defined in Annex II of Directive 2007/46/EC establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles.

Zero emissions category N vehicles with a mass exceeding 2480kg will be counted as light commercial vehicles from 1st January 2025, if the excess mass is due to the energy storage system.

If a vehicle has been registered outside of the EU for less than 3 months before it is registered in the EU, then it is will still be considered a ‘new’ vehicle.

The Regulation does not apply to special purpose vehicles, i.e. a vehicle intended to perform a function which requires special body arrangements and/or equipment. This category includes wheel-chair accessible vehicles, caravans, and ambulances, as defined by Part A of Annex II of Directive 2007/46/EC establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles.

Manufacturers responsible for fewer than 1000 new passenger cars or light commercial vehicles registered in the EU in the previous calendar year are not required to comply with certain requirements, including the requirement to meet specific emissions targets and pay excess emissions premium.

 

Amendment

Changes are made to set CO2 emission performance standards for new passenger cars and new light commercial vehicles for the period 2021-2024, so that UK CO2 targets are fully established, and relevant data can be collected. The new specific emissions targets that manufacturers must meet are outlined below.


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Jurisdiction: Scotland

Commencement: 30th November 2021

Amends:

Mini Summary
The Storage of Carbon Dioxide (Licensing etc.) (Scotland) Regulations 2011 implement the requirements of Directive 2009/31/EC on the geological storage of carbon dioxide into Scottish law.

Carbon capture and storage is a key technology to decarbonise electricity generation. CO2 created from fossil fuel  power stations can be injected and stored in undersea geological formations in Scottish territorial waters.
Duties
The Regulations prevent Scottish ministers from granting licences for storing CO2 in the water column.

Licence applications that are made to Scottish Ministers must include a specified length of time required for exploration ‘appraisal term’ or a reason why exploration is not required. The licensing authority is obligated to specify the length of appraisal time or length of time within which an application for a storage permit must be made. Licences are required to include provisions detailed in Schedule 1 to these regulations regarding the closure of storage sites.

Licence holders may be granted consent for the storage permits that are located within the licensed area. The regulations detail application requirements, the criteria that must be satisfied and details of the information that is required to be included in the storage permit.

In the event of leakage or irregularity the licensing authority may direct the operator to take corrective measures.

Storage permits may be reviewed, modified or revoked where a change in operation occurs, irregularities or leaks occur or where there is a breach in the terms and conditions.

The regulations include requirements for the closure of sites and the post closure obligations.
Amendment

Administrative changes are made to ensure that The Storage of Carbon Dioxide (Licensing etc.) (Scotland) Regulations 2011 continue to operate effectively now that the UK is no longer part of the EU. This includes replacing references to EU Directives with EU retained legislation. There are no changes to duties as a result of these amendments.

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Jurisdiction: UK

Commencement: 1st September 2021

Amends:

Mini Summary
The UK Retained: Regulation (EU) 2019/631 setting CO2 emission performance standards for new passenger cars and for new light commercial vehicles  are set by the European Commission (EC) for new passenger cars* and new light commercial vehicles* in order to help achieve the European Union (EU) greenhouse gas emissions reduction target and the objectives of the Paris agreement (a global action plan to limit global warming to below 2°C above pre-industrial levels).

*New passenger cars are Category M1 vehicles which are registered in the EU for the first time and have not previously been registered outside of the EU. Category M1 means vehicles for the carriage of passengers with no more than 9 seats, including the driver’s seat, as defined in Annex II of Directive 2007/46/EC establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles.

*New light commercial vehicles are Category N1 vehicles with a mass not exceeding 2610kg and those type approved under Regulation (EC) 715/2007 which are registered in the EU for the first time and have not previously been registered outside of the EU. Category N1 means vehicles for the carriage of goods with a maximum mass of 3.5 tonnes. as defined in Annex II of Directive 2007/46/EC establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles.

Zero emissions category N vehicles with a mass exceeding 2480kg will be counted as light commercial vehicles from 1st January 2025, if the excess mass is due to the energy storage system.

If a vehicle has been registered outside of the EU for less than 3 months before it is registered in the EU, then it is will still be considered a ‘new’ vehicle.

The Regulation does not apply to special purpose vehicles, i.e. a vehicle intended to perform a function which requires special body arrangements and/or equipment. This category includes wheel-chair accessible vehicles, caravans, and ambulances, as defined by Part A of Annex II of Directive 2007/46/EC establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles.

Manufacturers responsible for fewer than 1000 new passenger cars or light commercial vehicles registered in the EU in the previous calendar year are not required to comply with certain requirements, including the requirement to meet specific emissions targets and pay excess emissions premium.
Duties

Annual targets

From 1st January 2020:

This target will be complemented by additional measures corresponding to a reduction of 10g CO2/km as part of the EU’s ‘integrated approach’.

From 1st January 2025:

From 1st January 2030:

Specific emissions targets

Manufacturers are required to ensure that their average specific emissions of CO2 don’t exceed their relevant targets.

Specified emissions targets are based on the annual targets detailed above and are determined in accordance with the relevant calculations in Annex I or their derogation:

Monitoring and reporting of average emissions 

The competent authority for each EU country is required to record and make available to manufacturers (or their importers / representatives), and the EC, the information in Part A of Annex II and III for all new cars and commercial vehicles registered in their territory respectively.

They must also measure and report the specified emissions for cars that are not type approved (i.e. confirmation that they meet specified performance standards).

The EC is required to provisionally calculate the following information for each manufacturer for the last year, and notify the manufacturer:

Manufacturers have 3 months to inform the EC regarding any errors in the data.

Publication of performance of manufacturers

The EC is required to publish, by the 31st October each year, the finalised list of data on specified emissions and targets for each manufacturer for the last year. This should also include the average mass and average test mass of all new vehicles, as well as information on whether each manufacturer has complied with their targets.

This list will be published as an implementing act.

Excess emissions premiums

Each year excess emissions premiums are payable by manufacturers or pool managers where their average specific emissions of CO2 exceed their specific emissions target.

This is calculated using the following formula:
(Excess emissions X €95) X No. of newly registered vehicles

Derogations for certain manufacturers

Manufacturers that register under 10,000 cars or 20,000 commercial vehicles in the EU in a year can apply for a derogation as long as they are not part of a group of manufacturers that produce over these limits. If they are part of a group which exceeds these limits but the manufacturer has their own production and design facilities, then they may also apply for a degroation.

Derogation allow manufacturers to set an alternative specified emissions target which is consistent with their emissions reduction potential. It should be noted that they are still required to meet this revised target and will be required to pay the excess emissions premium if they do not.

A derogation lasts 5 years and can be renewed. They must be submitted by 31st October in the year that the derogation starts.

If there is a change to a manufacturer’s eligibility, they must notify the EC immediately.

Eco-innovation

Manufacturers and suppliers can use innovative technologies to achieve CO2 savings and help meet their targets. Only those approved by the EC will be considered.

The total contribution of innovative technologies can make to reducing average specified emissions of CO2 is up to 7gCO2/km.

Verification of the CO2 emissions of vehicles in service

Manufacturers must ensure that the CO2 emissions and fuel consumption values that are reported in certificates of conformity correspond with the actual values from vehicles in service in line with Commission Regulation (EU) 2017/1151 supplementing Regulation (EC) 715/2007 on type-approval of motor vehicles with respect to emissions from light passenger and commercial vehicles (Euro 5 and Euro 6) and on access to vehicle repair and maintenance information

 
Amendment

As Regulation 2019/631 was removed from the Northern Ireland Protocol shortly before the end of the transition period of the UK leaving the EU, a loophole was created for new newly registered cars and vans in Northern Ireland. This resulted in neither the EU nor the UK retained version of the Regulation applying to new passenger cars and vans in Northern Ireland and their CO2 emissions being unregulated.

This amendment extends the existing retained version of the Regulation to Northern Ireland, creating a UK -wide regime for the regulation of CO2 emissions from newly registered cars and vans from 1st September 2021.

The Regulation does not apply to vehicles registered in Northern Ireland between 1st January 2021 and 31st August 2021, unless they were also registered in GB.

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Jurisdiction: UK

Commencement: 22 April 2021

Amends: New Legislation
Mini Summary

The legal framework for auctioning of emissions allowances under the UK Emissions Trading Scheme (UK ETS) is established.

Summary
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.

One allowance equals one tonne of carbon dioxide (CO2) equivalent. At the end of each year, installations must have enough allowances to account for their GHG emissions. They have the flexibility to buy additional allowances on top of their allocation, or to sell surplus allowances generated from reducing their emissions below their allocation at auction. An allowance allows a participant to emit 1 tonne of carbon dioxide equivalent.

The UK ETS was implemented in the UK by The Greenhouse Gas Emissions Trading Scheme Order 2020 (‘2020 Order’). It replaces the European Union Emissions Trading System (EU ETS) for UK participants, which also follows the principles of emissions trading. For more general information on the UK ETS and how it works for participants see the entry for the 2020 Order.

The UK ETS authority for these Regulations are the national authorities, which are:

The Regulations are made under the power in section 96 of the Finance Act 2020 to make Regulations on the allocation of emissions allowances in exchange for payment. They are equivalent to the provisions made around allowances for EU ETS by Regulation (EU) 1031/2010 on the timing, administration and other aspects of auctioning of greenhouse gas allowances.
Duties
Auctions
As with the EU ETS, under the UK ETS auctioning continues to be the main means of introducing allowances into the market. Participants are also able to trade UK ETS emissions allowances on a secondary market. It is set out in Part 2 of the Regulations how bids are to be submitted and withdrawn, and how the auction clearing price is to be determined.

The minimum volume bid is one lot, and each lot auctioned must consist of 500 allowances. Each bid must state:

Each bid may only be submitted, modified or withdrawn during the bidding window set by the auction platform. Any unsold allowances can be added to the next four auctions up to a limit of 125% of their original volume.

The Auction Reserve Price (ARP) is set by these Regulations and this is the minimum price for which allowances can be sold at auctions. Bids below this price will not be accepted. The UK ETS has an ARP of £22. It is not intended that any changes will be made to the ARP before it is likely withdrawn as the scheme matures.
Auction Calendar
The auctioneer sets the auction calendar, including the bidding windows, individual volumes, auction dates, as well as the auctioned product, payment and delivery dates of the allowances to be auctioned in individual auctions each calendar year. The auction platform provider, ICE Futures, was appointed to host emissions auctions on behalf of the UK Government’s Department for Business, Energy and Industrial Strategy (BEIS), which has been appointed as the UK Auctioneer by the Treasury. ICE published the 2021 calendar for UK ETS auctions on 26th February 2021. The first UK ETS auction is 19th May 2021.

The appointed auction platform must publish the auction calendar for a year by 15th July of the preceding year or as soon as practicable after that date. The auction platform must also report transactions to the Financial Conduct Authority in order to provide appropriate regulatory oversight.

This legislation provides for fees and costs to be charged by the auction platform and auctions are to be monitored for issues such as market abuse, money laundering, terrorist financing or other criminal activity.

Auction participants will need to register with the appointed auction platform and must also hold a registry account in the UK Emissions Trading Registry. This registry system is used to ensure the accurate accounting of all allowances issued under the UK ETS, and it is used by operators to surrender allowances each year as required by the 2020 Order.
Cost Containment Mechanism
The Cost Containment Mechanism will be triggered if the average price for one allowance on secondary futures markets is more than:

If any of the above occur then the Treasury can authorise changing the distribution of allowances or increasing the volume of allowances to be auctioned at auctions within a calendar year.
Access to Auctions
Part 4 of the Regulations legislate access to auctions by participants and details the eligibility criteria and process for those applying to bid in auctions and participate in the auction platform’s secondary market. The appointed auction platform can refuse, revoke or suspend admission to bid in auctions.

There is a right of appeal set by these Regulations against decisions made by the auction platform, such as admissions to bid.

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Amendment

The Recognised Auction Platforms and Greenhouse Gas Emissions Trading Scheme Auctioning (Amendment) Regulations 2021 (SI 2021/513)
The 2021 Regulations are updated to correct some minor technical errors and provide further clarity on some parts of the legislation. Eligibility criteria for those participating in auctions originally set out in regulation 16 of the 2021 Regulations is updated. This means to be eligible to bid in UK ETS auctions, entities will need to be one of the following:

Clarity is given on how the auction clearing price for UK ETS auctions will be determined and clarifies that it cannot be significantly below the prevailing secondary market price. This is to ensure there is not a scenario where there is a difference between the auction clearing price when the auction fully clears compared to when it partially clears.

The cost containment mechanism (CCM) enables the Treasury to amend the distribution or volume of allowances to be auctioned in any one year if the carbon price exceeds specified limits. The thresholds for the CCM to be implemented are clarified, as well as how the carbon price is calculated to determine if the CCM is triggered.

 

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Jurisdiction: UK

Commencement: 31st December 2020

Amends: Regulation (EU) 2019/1242 of the European Parliament and of the Council of 20 June 2019 setting CO2 emission performance standards for new heavy-duty vehicles 
Mini Summary
Regulation (EU) 2019/1242 of the European Parliament and of the Council of 20 June 2019 setting CO2 emission performance standards for new heavy-duty vehicles sets carbon dioxide (CO2) emission performance standards for new heavy duty vehicles in the European Union (EU).
Amendment
This amendment comes into force on IP completion day. IP completion day is the day the transition period for the United Kingdom leaving the European Union ends and was 31st December 2020.

This retained EU Regulation is amended to ensure that CO2 emissions of new heavy-duty vehicles (HDVs) registered in the UK continue to be regulated. References to the EU and EU regimes are replaced with UK references. The first reporting period under the UK version of this Regulation will commence 1st July 2021.

 

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