UK launches business cap and trade plans

Businesses and public bodies which consume more than 6,000 MWh annually are to fall within a carbon cap and trade programme under new proposals revealed by the UK government.

The Carbon Reduction Commitment, announced in the Energy White Paper in May, is a mandatory cap and trade scheme that will cap emissions from up to 5,000 large business and public sector organisations.

The scheme is expected to include a further 14 million tonnes of carbon each year within a cap and trade scheme..

Environment minister Ian Pearson said: “We are committed to ambitious targets to reduce the UK’s CO₂ emissions and this will require contributions from all sectors of the economy and from across all parts of the UK.”

All allowances will be auctioned, with the revenue from the auction recycled to participants based on their performance and the government is consulting on the detailed implementation of the policy.