UK’s emissions market risks falling short

Standalone system will be just 10pc as large as its EU equivalent, and important details have not been announced

The UK has launched a domestic emissions trading system (ETS) to replace its membership of the EU ETS—but experts are concerned that the market’s rules are still not complete and it may not lead to a cut in emissions until 2030. The new mechanism, which took effect on 1 January, targets net-zero emissions by 2050 via progressively lowering the limit on CO2 emissions from industrial plants. Britain’s ETS will be c.10pc the size of the EU system but will cover the same sectors and installations that participated in the EU market. Companies such as Scottish energy provider SSE, British Airways and British Steel will need to buy and surrender allowances matching their annual emissions; penalties