UK Emissions Trading Scheme sale of allowances went live today

Today marks the first day of the sale of allowances under the new UK Emissions Trading Scheme (UK ETS). 

Following the end of the Brexit transition period, the UK is no longer part of the EU ETS so needed its own scheme, although there was some uncertainty at the start as to whether the UK would plump for a carbon tax or an ETS.  

See here for guidance on how the UK ETS works and who it applies to and here for guidance on the sale of allowances under the new scheme. Earlier this month, the government published the UK ETS allocation table, which sets out which stationary installations are entitled to free allowances for 2021-25. The aviation allocation table will be published in June. The government (BEIS) has said it will consult later this year on setting an emissions cap that is consistent with the UK's net zero target.

One of the big questions that still remains is whether the UK ETS will be linked to the EU ETS...but for the time being we are going it alone, at least until those negotiations have finished.