Policy paper

UK Emissions Trading Scheme: long-term pathway

Statement of plans to continue the UK ETS at least until 2050, to continue developing the scheme and to explore its expansion to new sectors.



This document sets out the steps we are taking to develop the long-term pathway for the UK Emissions Trading Scheme (UK ETS).

It is published by the UK ETS Authority – the governance body for the scheme, representing the UK Government, the Scottish Government, the Welsh Government and the Department of Agriculture, Environment and Rural Affairs for Northern Ireland – in response to a recommendation from MP Chris Skidmore’s Independent Review of Net Zero.

The statement affirms our commitment to continuing the UK ETS for the long term. We intend to legislate to continue the UK ETS beyond 2030 until at least 2050. The scheme will remain aligned with our net zero targets.

It also sets out the work we are doing to continue to develop the UK ETS. This includes aligning the UK ETS cap with the net zero trajectory; consultations to deliver initial expansion of the scheme to the waste and maritime sectors and to include engineered greenhouse gas removals in the scheme; a review of Free Allocation of ETS allowances to mitigate carbon leakage risk; and a review of UK ETS markets policy.

Thirdly, the statement sets out our intention to continue exploring expanding the UK ETS to more sectors of the economy, including to high-emitting sectors. It gives a framework for assessing new sectors before bringing them into the scheme.

Published 18 December 2023