UK Steel - Response to UK ETS Cap Beyond 2030 Consultation

April 2025

The UK Emissions Trading Scheme aims to support and incentivise the decarbonisation of industrial activities in the manufacturing and power sector. The question of whether to extend the UK ETS beyond 2030 should thus be whether the UK ETS has achieved this and whether it is the right policy tool in the future as well.

We would therefore support the comments made by the ETG in its response that “there is therefore a need for a holistic/joined-up approach from government to ensure that UK businesses can remain internationally competitive. This requires effective measures to tackle carbon leakage, such as continued free allocation and a well-functioning UK CBAM, expanded support for industry to decarbonise and wider support for decarbonisation across the economy.” We, therefore, cannot recommend extending the UK ETS beyond 2030 before the Government has demonstrated that the UK CBAM works as intended.