On 15 July 2020, there was published on legislation.gov.uk a draft of The Greenhouse Gas Emissions Trading Scheme Order 2020 together with a draft explanatory memorandum.
The purpose of the draft Order is to establish a UK-wide greenhouse gas emissions trading scheme (ETS), to encourage cost-effective emissions reductions which will contribute to the UK’s emissions reduction targets and net zero goal. Policy positions for a UK ETS which is operational from 1 January 2021 have been agreed by the four Governments of the UK nations, and are set out in the Government response to the Future of Carbon Pricing consultation, which was published on 1 June 2020. This is a policy replacement for the UK’s participation in the EU Emissions Trading System (EU ETS), which will cease at the end of the transition period on 31 December 2020. This would also allow for the possibility and consideration of a link between the UK ETS and the EU ETS, if it suited both sides’ interests.