UK ETS: Carbon prices for use in civil penalties, 2021 and 2022
Updated 29 November 2023
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Determination by the UK ETS Authority of the UK Emissions Trading Scheme (UK ETS) carbon price values for 2021 and 2022 in accordance with the Greenhouse Gas Emissions Trading Scheme Order 2020.
1. This is a determination by the UK ETS Authority of the values for the carbon price for the UK ETS scheme year beginning on 1 January 2021 and the UK ETS scheme year beginning on 1 January 2022 under article 46 of the Greenhouse Gas Emission Trading Scheme Order 2020 (‘the UK ETS Order’).
2. The 2021 carbon price is calculated in accordance with the following criteria as set out in article 46(2) of the UK ETS Order:
The carbon price for the 2021 scheme year is the sum of the relevant amount for each auction of allowances held in the period beginning on 1 January 2021 and ending on 11 November 2021 under regulations made by the Treasury under the Finance Act 2020 divided by the sum of the allowances sold at all those auctions.
where, as set out in article 46(3)
the relevant amount for an auction is the auction clearing price (that is to say, the price per allowance that, in accordance with the auction rules, each successful bidder must pay, irrespective of the original bid) multiplied by the number of allowances sold at the auction.
3. The 2022 carbon price is calculated in accordance with the following criteria as set out in article 46(4) of the UK ETS Order:
The carbon price for the 2022 scheme year or any subsequent scheme year (the “relevant scheme year”) is the average end of day settlement price, calculated over the relevant period, of the December futures contract for the relevant scheme year, as traded on the relevant carbon market exchange.
where, as set out in article 46(6)
‘relevant period’ means, in relation to the carbon price for the 2022 scheme year, the period beginning on 1 January 2021 and ending on 11 November 2021.
‘relevant carbon market exchange’ means the largest carbon market exchange as determined by volume of sales in the relevant period of the December futures contract for the relevant scheme year traded on the exchange.
4. The UK ETS Authority therefore determines that:
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the carbon price for the scheme year beginning on 1 January 2021 is £47.96
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the carbon price for the scheme year beginning on 1 January 2022 is £52.56
29 November 2021