UK publishes EU ETS results

The results for

installations in the second year of the EU Emissions Trading Scheme (EU ETS), which sets a cap on total carbon dioxide (CO2) emissions from European industries, were published today.

UK sites covered by the scheme emitted 251.1 million tonnes of carbon dioxide (MtCO2) in 2006, an increase of 8.8MtCO2, or 3.6%, from 2005. The power sector increased its emissions by 9.3MtCO2, while other industry sectors decreased their emissions by 0.5MtCO2 in 2006. The total UK cap for 2006 was 217.3MtCO2, meaning that 33.8 MtCO2 were purchased through emissions trading to keep within the overall cap.

Under the scheme, installations which emit more CO2 than their allocation need to buy allowances to cover the extra emissions, and installations that emit less are able to sell allowances. This creates an incentive for industry to reduce emissions and improve energy efficiency.

The overall increase in emissions from UK installations reflect the provisional CO2 statistics published in March, which showed an increase in overall CO2 emissions in the UK. This increase was due mainly to unusually high international gas prices, which led to a switch to coal in electricity generation. Coal-fired power stations emit approximately twice as much as gas-fired power stations per unit of electricity generated.

Defra’s provisional estimate of CO2 emissions in 2006 is that they were about 5.3% below 1990 levels. However, when the effect of the EU ETS is taken into account, UK emissions were about 11% below 1990 levels, the same as in 2005.

The results also show that in 2006, UK installations were 100% compliant with the scheme’s requirements to report emissions and surrender an equal number of allowances.

The sector-level summary of 2006 EU ETS results in the UK are available here: www.defra.gov.uk/environment/climatechange/trading/eu/results/