A carbon budget places a restriction on the total amount of greenhouse gases the UK can emit over a 5-year period. The UK is the first country to set legally binding carbon budgets.
Under a system of carbon budgets, every tonne of greenhouse gases emitted between now and 2050 will count. Where emissions rise in one sector, the UK will have to achieve corresponding falls in another.
Helping to meet the 2050 target
We introduced carbon budgets as part of the Climate Change Act 2008 to help the UK reduce greenhouse gas emissions by at least 80% by 2050.
We have set the first 4 carbon budgets in law, covering the period from 2008 to 2027. We have committed to halving UK emissions relative to 1990 during the fourth carbon budget period (2023 to 2027).
Each carbon budget is split into:
- the traded sector, which is based on the UK’s share of the EU Emissions Trading System (EU ETS) limit for the period and covers power and heavy industry
- the non-traded sector, which covers everything else like road transport, agriculture and buildings
Specifically, the carbon budgets limit our greenhouse gas emissions to:
- 3,018 million tonnes of carbon dioxide equivalent (MtCO2e) over the first carbon budget period (2008 to 2012)
- 2,782 MtCO2e over the second carbon budget period (2013 to 2017)
- 2,544 MtCO2e over the third carbon budget period (2018 to 2022)
- 1,950 MtCO2e over the fourth carbon budget period (2023 to 2027)
These levels have been set by:
- Carbon Budgets Order 2011
- Climate Change Act 2008 (Credit Limit) Order 2011
- Carbon Budgets Order 2009
- Climate Change Act 2008 (2020 Target, Credit Limit and Definitions) Order 2009
The Carbon Plan
Meeting the carbon budgets
Our latest projections suggest the UK is on track to meet its first 3 legislated carbon budgets:
Based on our planned policies, there is an expected shortfall of 205 MtCO2e over the fourth carbon budget. In the Carbon plan we set out scenarios for bridging an estimated shortfall of 181 MtCO2e. Our revised estimation reflects:
- revised population projections
- fossil fuel price projections
- greenhouse gas inventory corrections
- revisions to estimated savings from policies
Our ability to meet the carbon budgets relies on actions from the departments that lead on reducing emissions:
- Department of Energy & Climate Change (DECC)
- Department for Business, Innovation & Skills (BIS)
- Department for Communities and Local Government (DCLG)
- Department for Environment Food & Rural Affairs (Defra)
- Department for Transport (DfT)
- HM Treasury (HMT)
However, all departments are responsible for reducing emissions from their own buildings and estate and for assessing the carbon impact of new policies.
The actions to meet carbon budgets are agreed for budget periods 1 to 3 (2008 to 2022) and detailed in the Low Carbon Transition Plan. This information helps us track progress and risks to delivery, and acts as a benchmark.
The Environment Agency (EA) is the UK administrator and English regulator for the EU Emissions Trading System.
The EA can influence energy efficiency and limit greenhouse gas emissions by regulating and inspecting:
- business premises in the context of pollution prevention and control
- landfill sites (landfills emit the greenhouse gas methane)
The EA is also working to reduce greenhouse gas emissions through our regulatory roles in other areas of their expertise:
- flood and coastal risk management
- the planning system
The Climate Change Act 2008 places a legal obligation on us to annually report the UK’s emissions and progress towards meeting the carbon budgets.
Two reports fulfil this obligation:
- Annual statement of emissions
- Government response to the fourth annual progress report by the Committee on Climate Change
Carbon accounting will be used to determine compliance with the carbon budgets and targets. Read further information about carbon accounting:
- The Carbon Accounting (2013–2017 budgetary period) regulations 2015
- Office for Public Sector Information (OPSI): Carbon Accounting (Amendment) Regulations 2009
- Consultation on carbon units, the net UK carbon account and carbon accounting
- Guidance on carbon accounting and the net UK carbon account (updated December 2009)
International aviation and shipping emissions and the net UK Carbon Account
Domestic aviation and shipping emissions are included within the current Carbon Budgets framework. Due to uncertainties at the time the Climate Change Act was agreed, international aviation and shipping emissions were not included. The Act contained a requirement that Government reconsider their inclusion by end 2012, a requirement that was fulfilled through the laying of a Parliamentary Report: UK Carbon budgets and the 2050 target: international aviation and shipping emissions on 19 December 2012.
Government announced through the Report that, recognising uncertainty over the international framework for reducing aviation emissions and particularly the treatment of aviation within the EU Emissions Trading System, it was deferring a firm decision on whether to include international aviation and shipping emissions within the UK’s net carbon account.