PARLIAMENTARY WRITTEN QUESTION
(12 January 2026)

To ask the Secretary of State for Energy Security and Net Zero, whether any cost benefit analysis conducted by his Department on linking the UK Emissions Trading Scheme with the EU Emissions Trading Scheme assessed the potential impact of higher UK Allowance prices on UK industry and consumers as a result of price convergence.

Asked by:
Claire Coutinho (Conservative)

The price of carbon allowances in the UK Emissions Trading Scheme is set by the market.

As the conveners of the market the Government is not able to comment on current prices and price movements.

Linking the UK ETS and EU ETS is expected to bring significant economic benefits to the UK.

These include for example providing businesses with access to a larger, stable carbon market; and the removal of some of the regulatory barriers in sectors like CO2 storage.

Additionally, linking is expected to create the conditions for mutual CBAM exemptions, removing a major barrier to trade and lowering costs for UK firms.

Answered by:
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