UK ETS Authority to include maritime in emissions controls

The British government has launched a consultation process with the aim of including the maritime sector in its ‘domestic’ emissions trading scheme the UK ETS, with the stated aim of introducing charging in 2026.

The UK ETS Authority, which is composed of the UK Government, Scottish Government, Welsh Government and the Department of Agriculture, Environment and Rural Affairs for Northern Ireland, is looking for input into how the maritime industry can be incorporated into the scheme, with the consultation process set to end on 23 January 2025.

“We envisage that including maritime within the UK ETS can help overcome a key barrier to decarbonising the sector, which is that the prices of maritime fuels currently do not reflect their environmental costs. Including the maritime sector within the scheme could also strengthen the incentive to adopt low carbon fuels, and support deployment of fuel-efficient technologies and the introduction of fuel-efficient operating practices,” said a government statement.

Initially the UK ETS will cover domestic routes only and one of the key areas of this consultation will be to define what is a domestic voyage, at what level the thresholds for inclusion should be set and what emissions should be included in the scheme, NOx or methane for example, as well as carbon emissions.

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Moreover, the methodology around the monitoring, reporting and verification, carbon leakage risks, if any, and the impact of the ETS on supply chains.

The UK ETS Authority said it is also looking for input on the potential to expand the scheme: “The potential future expansion of the UK ETS to additional maritime emissions, with a future review of the threshold and coverage of international routes,” is also included in this initial consultation.

Launched in 2021, the UK ETS seeks to decarbonise aviation, power, and industry by capping emissions and creating a carbon trading price, which incentivises operators to reduce emissions.

In a joint statement the UK ETS Authority ministers Sarah Jones, Huw Irranca-Davies, Gillian Martin, Andrew Muir, James Murray, and Mike Kane said: “Expanding the UK ETS to include maritime and recognising non-pipeline transport for carbon capture and storage will encourage investment into clean technologies, a vital growth industry in the UK.”