UK Emissions Trading Scheme

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Environmental policy - carbon trading - UK.


The UK Emissions Trading Scheme began operation in January 2021, replacing the UK's participation in the EU Emissions Trading System (EU ETS).

Like the EU ETS, the UK ETS is an administrative approach used to control pollution by providing economic incentives for achieving reductions in the emissions of pollutants.

The UK ETS is a mandatory cap and trade scheme that requires heavy industries and power generators, as the major emitters of greenhouse gases, to monitor and report annually on their emissions and to purchase and return an amount of emissions allowances to the government that represents each year's carbon dioxide (or equivalent in other greenhouse gases) output.

See also