Business
Britain seeks views on including shipping in carbon market from 2026
Published by Jessica Weisman-Pitts
Posted on November 29, 2024
2 min readLast updated: January 28, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on November 29, 2024
2 min readLast updated: January 28, 2026
LONDON (Reuters) – Britain has called for views on changes to its emissions
LONDON (Reuters) – Britain has called for views on changes to its emissions trading system (ETS) that could see the shipping sector join its carbon market from 2026.
Britain’s ETS is part of its wider efforts to meet climate targets and was launched in 2021 to replace its participation in the European Union’s ETS after it left the bloc.
The scheme currently covers power plants, factories and airlines representing around a third of Britain’s emissions.
Under the ETS, the government sets a gradually decreasing cap on the amount of emissions that a sector, or group of sectors, can produce. It creates carbon permits for those emissions and companies must buy one for each tonne of carbon dioxide (CO2) they emit.
“Expanding the scheme to include the maritime sector… will ensure that the price of fuels used by the sector better reflects their environmental impacts,” the UK Emissions Trading Scheme Authority said in a statement late on Thursday.
Benchmark UK carbon permits currently trade around 36.60 pounds ($46.44) per metric ton of CO2.
The move would follow Europe, which began phasing the shipping industry into its ETS from the beginning of 2024.
The consultation, which is open to everybody, is open until the end of Jan. 23, 2025.
($1 = 0.7881 pounds)
(Reporting By Susanna Twidale; Editing by Frances Kerry)
A carbon market is a trading system where companies can buy and sell carbon credits to meet their emissions reduction targets. It aims to reduce greenhouse gas emissions by putting a price on carbon.
An emissions trading system (ETS) is a market-based approach to controlling pollution by providing economic incentives for reducing emissions. Companies receive or buy permits to emit a certain amount of greenhouse gases.
Carbon permits are allowances that permit the holder to emit a specific amount of carbon dioxide or other greenhouse gases. Companies must acquire these permits to legally emit greenhouse gases under an ETS.
The UK Emissions Trading Scheme is a market for carbon emissions established to help the UK meet its climate targets. It includes various sectors, including power plants, factories, and airlines.
Including shipping in the carbon market aims to ensure that the environmental impact of maritime fuels is reflected in their prices, promoting more sustainable practices within the shipping industry.
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