Guidance

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

Updated 11 November 2024

As per current legislation, all installation operators within scope of the UK Emissions Trading Scheme (UK ETS) are required to submit data to their regulator between 1 April and 30 June 2025, ahead of the next allocation period. The recent consultation to move the start of the second allocation period from 2026 to 2027 did not propose to change those specific data collection dates (see Free Allocation Review below). Under current rules, the start date of the lists of operators with hospital or small emitter (HSE) and ultra-small emitter (USE) status is 2026. The recent consultation did not propose to change that date.  

This data collection exercise forms the basis of an application for free allocation (FA). It is also the window during which operators must apply for HSE or USE status.

Aircraft operators are not required to submit any data during this window.  

The baseline data collection is an essential part of the FA application. Failure to submit this report by the deadline will result in an operator not receiving FA at any point during the second allocation period.  

It is also essential that any HSE and USE applications are made within this window. An operator will be unable join these lists for the 2026-2030 period if an application is not made during this window.   

Those with obligations to submit data include: 

1. All installation operators, even those who do not want to apply for FA or will not be eligible for FA, in the next allocation period. 

2. All installation operators who would like to apply for FA in the next allocation period and who have had a greenhouse gas emissions / HSE permit issued before or on 30 June 2025. This includes HSE and USE installations who may exceed the USE or HSE thresholds during the second allocation period and would then need to rejoin the main UK ETS scheme. In those circumstances, an application is required in this April-June 2025 window for these installations to be eligible for FA. 

3. Those who wish to apply for HSE status from 2026-2030 under Schedule 7 of the Greenhouse Gas Emissions Trading Scheme Order 2020 (‘the Order’). 

4. Those who wish to apply for USE status from 2026-2030 under Schedule 8 of the Order.  

The deadline of 30 June 2025 is fixed within legislation, and you are advised to engage with your suitably accredited verifier ^{[footnote 1]} early to resolve any problems, and if appropriate, to also engage with your regulator as early as possible. No change to the baseline data collection  dates has been proposed. See all relevant legislation. 

What information to submit  

This section clarifies the data required for each type of application or data submission, to allow collection and verification work to commence. It is important that you read this information carefully and consult the relevant legislative provisions.

Aircraft operators are not required to submit any data during this window.  

To aid the submission of correct data, the UK ETS Authority will share specific templates for submission along with associated guidance in January 2025.  

We expect the template for existing USEs to be available slightly earlier than the other templates, to allow existing USEs to begin verifying their emissions in 2024. The UK ETS Authority will alert operators when templates and guidance are available. 

The section numbers here correlate with the corresponding row in the summary table below.

1. For operators applying for FA in the second allocation period

All UK ETS operators applying for FA in the second allocation period (including Greenhouse Gas Emission Permit (GHGE) operators, HSE permit holders and those with USE status) must submit an independently verified Baseline Data Report (BDR) to their regulator in the 2025 application window. Additionally, unless it has already been approved under Article 8 of the Free Allocation Regulation (FAR), an operator applying for FA must also submit their monitoring methodology plan (MMP). See row (1) of the table below. 

In the Authority Response to the Developing the UK ETS consultation ^{[footnote 2]}, the UK ETS Authority announced changes to the electricity generator classification that would come into effect in 2026. If operators think that they will become eligible for FA from 2026 and would like to receive FA in the second allocation period, they must submit their MMP (unless already approved under Article 8 FAR) and a full, independently verified BDR to their regulator on or before 30 June 2025. 

The requirement to submit data during the 2025 application window is an obligation under current legislation. This will not be impacted by decisions taken as part of the recent targeted consultation to move the start of the second allocation period for stationary installations from 2026 to 2027 and to treat 2026 as an extension of the current allocation period for the purposes of determining FA. It will also not be impacted by decisions taken as part of the Free Allocation Review.  

Failing to submit the ‘full’ BDR and MMP (if required) will result in an operator not receiving FA at any point during the second allocation period.  

2. For operators who are not eligible for FA or those who choose to forego their entitlement to FA; and that do not apply for HSE or USE status for the 2026-2030 period

UK ETS operators that are not eligible or do not wish to apply for FA in the second allocation period and are not applying for HSE or USE status will only need to provide installation data and activity information. This includes:

• identification codes
• permit information
• operator data
• installation detail
• activities and associated NACE codes
• details of eligibility for FA
• a statement outlining that the operator is not applying for FA.

These do not need to be verified. See row (2) of the table below. 

3. For operators applying for HSE status for the 2026-2030 period 

UK ETS operators who wish to retain their HSE status or apply for HSE status for the first time for the 2026-2030 period will need to supply the information listed in the table to demonstrate the fulfilment of the HSE qualifying criteria. See row (3) of the table below. 

Existing GHGE or HSE operators wishing to apply for HSE status may not need to have their reports verified if they have already submitted annual emissions reports that have been verified, or self-declared. Operators should confirm with their regulator if they are unsure whether their reports will require verification. 

Operators applying for HSE status can also make an application for FA at the same time: refer to Section 1 above For operators applying for FA in the second allocation period if you intend to make a simultaneous application for FA. To apply for FA, you must submit a verified BDR and MMP (as per row 1 of the table), unless your MMP has already been approved under Article 8 of the FAR. 

If UK ETS operators exceed the thresholds for HSE eligibility during the second allocation period, they must rejoin the main UK ETS scheme. If operators think that this is a possibility for their installation, they must apply for FA during this application window if they wish to receive FA when they are subject to the main UK ETS. These installations must submit their MMP (unless already approved under Article 8 FAR) and a full, independently verified, BDR to their regulator on or before 30 June 2025.  

4. For operators applying for USE status for the 2026-2030 period

UK ETS operators who wish to retain their USE status or apply for USE status for the first time for the 2026-2030 period will need to supply the information listed in the table below to demonstrate the fulfilment of the USE qualifying criteria. See row (4) of the table below. 

Existing USEs who wish to retain their USE status during the 2026-2030 period will be able to complete a separate Ultra Small Emitter Data Collection template containing 3 years’ worth of emissions data (2021, 2022 and 2023). This will need to be verified as satisfactory by a UKAS accredited verifier to demonstrate the fulfilment of the USE qualifying criteria.  

Existing GHGE or HSE operators wishing to apply for USE status may not need to have their reports verified if they have already submitted annual emissions reports that have been verified, or self-declared. Operators should confirm with their regulator if they are unsure whether their reports will require verification. 

The UK ETS Authority has recently consulted on proposals to allow operators who started a regulated activity after 1 January 2021 to apply for USE status for the 2026-2030 period. We will confirm the outcome of this consultation exercise and any amendments to submission requirements before the start of the 2025 application window.  

Operators applying for USE status can also make an application for FA at the same time: refer to Section 1 above For operators applying for FA in the second allocation period if you intend to make a simultaneous application for FA. To apply for FA, you must submit a verified BDR and MMP (as per row 1 of the table), unless your MMP has already been approved under Article 8 of the FAR. 

If operators think that they may exceed the threshold for USE eligibility during the second allocation period, they must rejoin the main UK ETS scheme (or, if eligible, become HSEs). If operators think that it is a possibility that their installation may have to rejoin the main UK ETS, they must apply for FA during this application window if they wish to receive FA when they are subject to the main UK ETS. This means that they must submit the full, independently verified, BDR data to their regulator before 30 June 2025 and their MMP (unless your MMP has already been approved under Article 8 of the FAR). Refer to Section 1: For operators applying to receive FA in the second allocation period if you intend to make a simultaneous application for FA.  

Summary of submission requirements

This table provides a summary of the submission requirements for each type of operator. It is indicative and intended to support you to meet your data submission requirements. For exact data requirements see the legislation summarised at the bottom of this page. It will be the operator’s responsibility to ensure that they have provided the information required under the legislation.  

The deadline for all submissions is 30 June 2025.

Type of operator	Definition	What data is this operator required to submit?	What is the approach to verification?
1. FA applicants	Operators applying for FA in the main UK ETS in the next allocation period (could be existing GHGEs, HSEs or USEs)	- Installation Data - Attribution of emissions * - Data on energy input * measurable heat and electricity * - Sub-installation data relating to product benchmarks * - Sub-installation data relating to fall-back sub-installations * - Special data for some product benchmarks * - Unless it has already been approved under Article 8 FAR, a monitoring methodology plan *	Full verification *
2. Non-FA, non-USE and non-HSE data submissions	All operators ** who are not applying for FA for the second allocation period, nor HSE status or USE status for the 2026-2030 period.  Includes operators who meet the ‘electricity generator’ classification and are therefore not FA-eligible unless they produce heat from high efficiency co-generation or district heating.	- Permit information - Installation detail - Activities and associated NACE codes - Details of eligibility for FA - Statement that the operator is not applying for FA.	No verification needed
3. HSE applicants	Operators applying for HSE status for the 2026-2030 period.	- Installation data including details of any permit in force and annual emissions data and associated evidence to demonstrate that you meet condition A, B or C - And, if you are simultaneously registering an application for FA, all of the information listed above in (1), which includes a monitoring methodology plan (unless the MMP is already approved under Article 8 FAR)	If applying under condition B or C, verification or self-declaration is required. If applying under condition A, verification or self-declaration may be required. Please see Schedule 7 to the Order linked at the end of this page.
4. USE applicants	Operators applying for USE status for 2026-2030 As explained above, we expect the template for existing USEs to be available slightly earlier than the other templates, to allow existing USEs to begin verifying their emissions in 2024.	- Installation data including annual emissions data for 2021, 2022, and 2023 to demonstrate that you meet the relevant condition. - And, if you are simultaneously registering an application for FA, all of the information listed above in (1), which includes a monitoring methodology plan (unless the MMP is already approved under Article 8 FAR)	Verification or self-declaration. If you are an existing USE reapplying for USE status, and you have not had your emissions data verified or self-declared before, you will need to get it verified before applying for USE status.

*If an operator does not complete these sections, its application for FA in the second allocation period will not be complete. If a monitoring methodology plan has not already been approved by the regulator, all operators applying for FA including USEs and HSEs must submit this alongside the BDR template.

** Only operators of the following installations are required to provide this data:

- (a) an installation for which a permit is issued on or before 30 June 2025;
- (b) an installation that is a USE for the 2025 scheme year
- (c) an installation for which an application for a permit has been made but not yet determined

Free Allocation Review  

As previously communicated, the UK ETS Authority has consulted operators in the scheme on a proposal to move the start of the second allocation period from 2026 to 2027 for FA purposes. This follows recognition of stakeholder views and concerns over the potential misalignment of industrial decarbonisation and carbon leakage policy. Making this change would enable us to align the implementation of the Free Allocation Review with the introduction of the UK CBAM, ensuring a holistic policy approach to carbon leakage.  

Under this proposal, any changes to FA policy following the Free Allocation Review are proposed to take effect from 2027. The Free Allocation Review consultation sought views on some changes to FA rules, such as changes to the carbon leakage list and application of the carbon leakage exposure factor, which, if implemented, could change eligibility for FA. If the proposal to delay the second allocation period and the Free Allocation Review to 2027 is implemented, depending on the outcome of the Free Allocation Review, some installations’ eligibility to FA could change after the baseline data collection exercise has concluded. In addition, the indicative FA values produced by the BDR template may be subject to revision following the publication of any changes to the FA rules resulting from the Free Allocation Review.  

The UK ETS Authority will be responding to the consultation to move the start of the second allocation period from 2026 to 2027 before the start of the baseline data collection exercise. If the proposal in the consultation is implemented, the Authority Response will set out timings for the proposed second stage of the FA application and more information on any requirements following the baseline data collection exercise. The UK ETS Authority is providing the current guidance now to ensure that all operators have early notice on requirements for the April-June 2025 baseline data collection. 

As per current legislation, the baseline data collection will take place between 1 April and 30 June 2025.  It remains an essential part of the FA application, and failure to submit this report by the deadline will result in the operator not receiving FA at any point during the second allocation period.

UK Carbon Border Adjustment Mechanism (CBAM)

On 30 October 2024, the government issued a response to the consultation on implementing the UK Carbon Border Adjustment Mechanism (CBAM), confirming which sectors will be covered by a CBAM. UK ETS operators within CBAM sectors should apply for free allowances as usual by completing the baseline data collection exercise in 2025.  

The UK ETS Authority will consult in due course on how to adjust FA for CBAM covered sectors. ^{[footnote 3]}

Other questions

Can I change my mind about applying for FA after the BDR window closes?

If an existing operator chooses not to submit the full independently verified BDR during the BDR submission window, they will not receive FA at any point during the second allocation period, regardless of any changes being made during that period.  

We will provide more information on how the end-to-end FA process will work in the upcoming Authority response to ‘Moving the Second UK ETS Free Allocation Period’. 

Can HSEs and USEs apply to join the main scheme?

If an operator is currently on the USE or HSE list and expects to join the main scheme for the second allocation period, it is important that they complete a BDR. As explained above, an operator will only be eligible for FA if they submit all the required information, and this is submitted with a verified report and MMP (unless the MMP has already been approved under Article 8 of the FAR). 

How to submit your information 

The UK ETS Authority will publish templates for use by operators. We anticipate that these will be available to download from January 2025 (with the USE template being available in 2024).  

We will send a further alert once the templates have been published with further detailed instructions on how to submit. 

We advise operators to do the following:

• consult the legislation to ensure that your application for FA, HSE status or USE status complies with the legislative requirements. See below for the relevant legislation
• if not applying for FA nor HSE/USE status, consult the legislation to ensure that your data submission complies with the legislative requirements. See the relevant legislation below.
• contact your regulator if you are unsure on the next steps regarding your specific circumstances
• organise independent verification if this is needed. Operators should contract an independent and accredited verifier, in line with the Accreditation and Verification Regulation, so that the completed baseline data report template and the corresponding monitoring methodology plan, if this has not already been approved by the regulator, can be verified. ^{[footnote 4]} 

Contacts for queries and submissions

Contact the UK ETS Authority if you have queries relating to UK ETS policy:

[email protected].

Regulator contact details

Contact the regulators with queries and submissions:

• for sites in England - the Environment Agency (EA) at [email protected]
• for sites in Scotland - the Scottish Environment Protection Agency (SEPA) at [email protected] 
• for sites in Wales - National Resources Wales (NRW) at [email protected]
• for sites in Northern Ireland - the Northern Ireland Environment Agency (NIEA) at [email protected]
• for offshore facilities - the Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) at OPRED@energysecurity.gov.uk

Relevant legislation

The rules on free allocation are contained in Commission Delegated Regulation (EU) 2019/331 of 19 December 2018 as it forms part of UK domestic law. This Regulation is known as the Free Allocation Regulation: Commission Delegated Regulation (EU) 2019/331   

For operators not applying for FA nor USE/HSE status the requirement to submit data is contained in article 27A of the Greenhouse Gas Emissions Trading Scheme Order 2020 (the ‘Order’): The Greenhouse Gas Emissions Trading Scheme Order 2020  

For FA-eligible operators, application detail is included in Article 4 of the Free Allocation Regulation: Commission Delegated Regulation (EU) 2019/331, Chapter 2, Article 4  

For HSE applicant criteria and application detail, refer to Schedule 7 to the Order *: The Greenhouse Gas Emissions Trading Scheme Order 2020, Schedule 7. 

For USE applicant criteria, and application detail, please refer to Schedule 8 to the Order * (which also refers to the modifications to the Verification Regulation for existing USEs): The Greenhouse Gas Emissions Trading Scheme Order 2020, Schedule 8

Schedule 8A to the Order is also relevant for HSE and USE applicants: The Greenhouse Gas Emissions Trading Scheme Order 2020, Part 1, Article 8A.   

*See paragraph 5(6) of Schedule 7 and paragraph 3(7) of Schedule 8 to the Order for more information on verification requirements for HSE and USE applicants.

1. The verifier must be accredited by UKAS for scope 98 and the specific regulated activity for the installation. ↩

2. Consultation: Developing the UK Emissions Trading Scheme (UK ETS). ↩

3. Find more information: Consultation on the introduction of a UK carbon border adjustment mechanism ↩

4. UKAS website: Validation and Verification Body Accreditation ↩