Carbon Emissions

(asked on 15th July 2021) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, pursuant to the Answer of 15 July 2021 to Question 902805 on carbon tax in the transition to net zero, what other potential measures the Government is assessing to mitigate the risk of carbon leakage.


Answered by
Kemi Badenoch Portrait
Kemi Badenoch
President of the Board of Trade
This question was answered on 20th July 2021

As discussed in the Net Zero Review Interim Report and the Industrial Decarbonisation Strategy, a range of approaches could be used to help address the risk of carbon leakage.

Currently, the UK addresses carbon leakage risk primarily through the provision of free UK Emissions Trading Scheme (UK ETS) allowances. Our approach to the provision of free allowances is being reviewed and we aim to consult later this year to ensure the system continues to be fair, equitable and to incentivise decarbonisation. In addition, there are further relief schemes to reduce the cumulative impact of some energy and climate change policies on industrial electricity prices for eligible energy intensive industries (EIIs), on which a separate consultation is currently open.

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