UK and EU Reach an Agreement to Link ETS

The UK and EU have reached a significant agreement to link their respective Emissions Trading Schemes (ETS) as part of a broader post-Brexit co-operation deal.

The agreement aims to boost the UK economy, support British jobs, and reduce costs for consumers by improving trade and co-operation with the EU. The UK and EU will link their carbon markets, allowing emissions allowances to be traded across both jurisdictions to achieve the following:

• Reduce UK greenhouse gas emissions by 2.5% through price alignment alone.
• Further reduce emissions and increase GDP by up to 0.7% cumulatively.
• Improve price stability and reduce compliance costs for businesses.
• Provide benefit to UK firms in cheaper emissions reductions.

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