THE UK Government’s proposal to link the UK and EU Emissions Trading Schemes (ETS) has been ‘cautiously welcomed’ by UK cement and lime makers.
The Mineral Products Association (MPA) has been calling for a link between the UK and EU schemes for several years and welcomed the announcement as one part of the policy framework needed to support the sector.
However, the MPA has repeated its calls for the government to tackle the high electricity costs that it claims ‘exacerbate’ the issues facing the industry, undermining its international competitiveness and making it vulnerable to imports.
The MPA has also reiterated the importance of delivering a ‘watertight’ UK Carbon Border Adjustment Mechanism (CBAM), levelling the carbon costs with imports from outside the EU and preventing decarbonisation by deindustrialisation.
The organisation said linking the two schemes will give UK cement and lime producers access to a larger, more liquid carbon market, bringing the kind of stability needed to promote investment confidence.
Dr Diana Casey, MPA’s executive director for energy and climate change, said, “We’ve been calling for linking UK and EU schemes for some time and the government’s announcement is a step in the right direction. However, the governance of the ETS is crucial to get right and it’s unclear how much of a say the UK will have in shaping the evolution of the emissions trading scheme and its interaction with the CBAM. We also can’t ignore the fact that wider barriers to the competitiveness of UK cement and lime manufacture remain.
“While we welcome moves towards linking, it is important that this is followed up by bringing UK industrial electricity costs into line with competitor economies. It is also vital that the UK ensures its own CBAM is robust to ensure imports pay the same cost on carbon faced by domestic producers.”
