United Kingdom · Emissions trading system
UK Emissions Trading Scheme (UK ETS)
The UK ETS has operated since January 2021 as a cap-and-trade system for power, industry and aviation. Domestic maritime emissions entered the scheme on 1 July 2026, and in December 2025 the UK ETS Authority announced a second phase running from 2031 to the end of 2040.
In forcesince Jan 2021Verified 4 Oct 2026
The scheme was established by the Greenhouse Gas Emissions Trading Scheme Order 2020, made under the Climate Change Act 2008. Operators of covered installations and aircraft operators must hold permits, monitor and report emissions and surrender allowances equal to verified emissions, with civil penalties for non-compliance. It covers around 1,000 installations and about 400 aircraft operators.
The 2026 cap is 77.4 MtCO2e. From 1 July 2026 the scheme covers cargo and passenger ships of 5,000 gross tonnage and above on voyages between UK ports and while at berth, with about 9.3 million allowances added to the cap. The auction reserve price rose from GBP 22 to GBP 28 on 8 April 2026 and is to be adjusted annually for inflation from 1 January 2027.
Legal journey
From proposal to operation
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Enacted
Greenhouse Gas Emissions Trading Scheme Order 2020 made under the Climate Change Act 2008
legislation.gov.ukOfficial
Each milestone links to the page it was checked against. Dates are given only to the precision the source supports.
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