LONDON (Reuters) – Britain will likely be excluded from the European Union’s Emissions Trading System (ETS), a mechanism for serving to to restrict the affect of local weather change, if the nation leaves the bloc in March 2019 and not using a deal, the government mentioned on Friday.
It revealed a sequence of papers setting out the implications of a “no deal” Brexit, a state of affairs it says stays unlikely given the work occurring in the direction of securing a negotiated final result.
In one paper, it mentioned that in a no-deal situation, the nation would subsequent yr change to assembly its carbon pricing commitments through a tax system.
“The UK will be excluded from participating in the (ETS) in a ‘no deal’ scenario,” it mentioned.
“The UK government will publish more details of how it will initially apply a carbon price in a ‘no deal’ scenario at Budget 2018 and legislation will be included in the Finance Bill 2018-19,” it added.
The European ETS expenses energy crops and factories for each tonne of carbon dioxide they emit.
Britain has mentioned that if there’s a Brexit deal, the nation plans to stay within the ETS till at the very least the tip of its third buying and selling section working from 2013-2020.
As the second largest emitters of carbon dioxide in Europe, British utilities are among the many largest consumers of carbon permits within the ETS. Carbon analysts have mentioned Britain’s exit from the scheme would probably have a bearish affect on costs.
Reporting by Sarah Young; enhancing by Stephen Addison