Guidance

Participating in the UK Emissions Trading Scheme (UK ETS)

This guidance explains who the UK Emissions Trading Scheme (UK ETS) applies to and what is required of businesses that are covered.

From:
Department for Energy Security and Net Zero and Department for Business, Energy & Industrial Strategy
Published
17 December 2020
Last updated
11 November 2024 — See all updates

Documents

Participating in the UK ETS

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UK ETS guidance note: Uncertainty assessments for installations

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UK ETS installations, hospitals, small emitters and ultra-small emitters: baseline data collection, 1 April – 30 June 2025

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Details

A UK Emissions Trading Scheme (UK ETS) replaced the UK’s participation in the EU ETS on 1 January 2021. The 4 governments of the UK have established the scheme to increase the climate ambition of the UK’s carbon pricing policy, whilst also protecting the competitiveness of UK businesses.

This guidance explains who the UK ETS applies to and what is required of businesses that are covered.

Updates to this page

Published 17 December 2020
Last updated 11 November 2024 + show all updates

  1. All installation operators within scope of the UK Emissions Trading Scheme (UK ETS) are required to submit data to their regulator between 1 April to 30 June 2025.

  2. Added a section to include information on supply of allowances.

  3. Added link to the evaluation of the UK ETS Phase 1.

  4. We have updated section 8. Activity Level Changes – COVID-19 with further guidance on the Activity Level Changes Regulation.

  5. Updated with details of new reporting service process now ETSWAP is no longer being used.

  6. We have provided an update on the new permitting, monitoring and verification system, now called Manage Your UK Emissions Trading Scheme Reporting Service (METS)

  7. Update added regarding a forthcoming evaluation to understand the effectiveness of the scheme's implementation.

  8. Added link to UK / Swiss memorandum of understanding on aviation in their respective Emissions Trading Schemes.

  9. Added Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) contact details.

  10. New section 'Activity Level Changes – COVID-19' added to 'Participating in the UK ETS' guidance.

  11. The launch of the new permitting, monitoring, reporting and verification system that will replace ETSWAP has been postponed until 2023 - exact dates to be confirmed.

  12. UK ETS guidance note: uncertainty assessments for installations added.

  13. Published the latest monthly update on the scheme's Cost Containment Mechanism (CCM).

  14. Added link to January 2022 Cost Containment Mechanism decision.

  15. Details added about new digital permitting, monitoring, reporting and verification system being introduced from autumn 2022.

  16. The UK ETS Cost Containment Mechanism (CCM) has triggered for January.

  17. Added link to new UK ETS Cost Containment Mechanism decisions page.

  18. Published the latest monthly update on the scheme's Cost Containment Mechanism (CCM).

  19. Published the latest monthly update on the scheme's Cost Containment Mechanism (CCM).

  20. We have updated the reference to the 2021 auction calendar. This was published by ICE Futures Europe (ICE) on 19 October and includes surplus allowances set aside (but not required) for 2021 aviation free allocation entitlements.

  21. Published the latest monthly update on the scheme's Cost Containment Mechanism (CCM).

  22. The Activity Level Report submission process has been updated.

  23. Published the latest monthly update on the scheme's Cost Containment Mechanism (CCM) to include the latest CCM trigger price and the August average price. The August average price was below the November trigger price, therefore the earliest the CCM can be triggered is December 2021.

  24. We have added the average carbon price in July 2021 and the Cost Containment Mechanism (CCM) trigger for November 2021. We have also made clear that the CCM cannot be triggered in August, September and October.

  25. Guidance updated to provide additional clarity to the calculation of the CCM trigger price. We have also updated the CCM trigger price for October 2021 and the Actual December Futures average price for June.

  26. We have published the Aviation Allocation Table which contains a list of each aircraft operator’s free allocation entitlement for the 2021 to 2025 allocation period.

  27. We have provided more guidance on the Cost Containment Measure (CCM), the September CCM trigger price and the average May UK allowance price.

  28. We aim to allocate allowances for the 2021 scheme year to operator holding accounts in the UK ETS Registry by 28 May 2021.

  29. We have published the Allocation Table, which contains a list of each installation's free allocation for the 2021 to 2025 allocation period.

  30. Added further information on how free allocation for operators of installations will work. We aim to publish an Allocation Table containing each installation's free allocation by 14 May 2021. If you are included in the table, you must submit a verified Activity Level Data Report by 30 June 2021. From 2022, free allocation will be allocated on or before 28 February of each calendar year.

  31. Added further information on how auctions operate, including who is eligible to bid in auctions.

  32. Added timetable for onboarding UK Emissions Trading Registry accounts.

  33. The calendar for UK ETS auctions in 2021 has been published by auction platform provider ICE. We have included a link to the calendar from this guidance.

  34. Section on auctioning updated to include information on the Auction Reserve Price, the Cost Containment Mechanism and the Auctioning Regulations.

  35. First published.

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