Carbon Emissions: Taxation
The question
To ask the Secretary of State for Energy Security and Net Zero, what assessment his Department has made of the potential impact of aligning with the EU Emissions Trading System on the price of carbon in the UK.
Answered by Sarah Jones
The price of carbon allowances in the UK Emissions Trading Scheme is set by the market.
Linking the UK and EU ETSs is expected to create a larger, more stable market, which will lower the costs of decarbonisation for UK businesses. Many industry stakeholders, including Make UK, UK steel, and Energy UK, have voiced support for linking the two schemes, citing that linkage would align carbon prices and support business investment and certainty, by creating a larger and more liquid carbon market.
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