“Powering up Britain” & UK CBAM (UK)

Today 30th March 2023, the UK government published two documents – here

(1) “Powering up Britain: Energy Security Plan”

(2) “Powering up Britain: Net Zero Growth Plan”

And (3) a consultation on UK CBAM see below (the UK’s response to carbon leakage – caused when manufacture is moved to a less regulated jurisdiction) [an earlier Blog post covers the EU CBAM, which is nearing enactment]

The Net Zero Growth Plan responds to the Independent Review of Net Zero (Chris Skidmore MP); is the annual update against the Net Zero Strategy, both on a national and local level; responds to the Climate Change Committee’s (CCC) 2022 Annual Progress Report; and sets out the package of policies and proposals to meet carbon budgets up to carbon budget 6 in 2037.

A couple of useful confirmations – the UK government will –

* publish the full government response to the UK ETS Develop consultation; set out a long-term pathway for the UK ETS (including possible expansion of UK ETS to cover energy from waste/waste incineration and domestic maritime emissions); and work within the ETS Authority to publish it in 2023

* legislate to continue UK ETS beyond 2030 until at least 2050

* review the free allocation of ETS allowances, in the context of a UK CBAM

* extend the current Climate Change Agreements Scheme for two further years, to continue the availability of Climate Change Levy discounts for meeting energy efficiency or carbon reductions targets

* publish a consultation (later in 2023) to review the current Batteries Regulations, to consider measures to promote the recovery, reuse, or recycling of all battery chemistry types. [note the current Batteries Regulations are listed for deletion under the REUL project]

UK CBAM consultation – “Addressing carbon leakage risk to support decarbonisation” – a UK CBAM would follow the EU approach and apply to industries trading in UK ETS. Closing date is 22 June 2023. Here

A UK CBAM is one option in the consultation – the consultation covers –

(1) a carbon border adjustment mechanism (CBAM) – a tax (this is a Treasury and DESNZ consultation) – to be applied on imports to reflect the carbon emitted during production and the gap between the carbon price applied in the country of origin and the carbon price that would have applied in the UK

(2) mandatory product standards (MPS)

(3) product labeling

(4) emissions reporting

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