The Daily Telegraph

Net zero plan ‘watered down’ over cost of living fears

- By Ben Riley-smith

A NET zero plan to reduce carbon emissions that would have forced up petrol and heating bills has been scaled back amid concerns of a cost of living crunch.

The Daily Telegraph has learnt that proposals to expand the UK Emissions Trading Scheme have been significan­tly watered down after an internal backlash from senior ministers.

A consultati­on about what areas the scheme, which caps carbon emissions in certain sectors, should be applied to had included fuel used for vehicles and heating in the UK.

But both of those elements have now been removed after fears that it could cause a political storm given petrol and energy bills have seen marked increases in recent months.

The Whitehall battle has been playing out in private, with repeated redrafts of the consultati­on being made before it is released to the public. The document outlining the approach was due to be published in the summer, then before the Cop26 UN climate change summit in November. Now it is expected in the spring of 2022.

Early drafts said that the emissions trading scheme would be “radically” expanded, but that word is understood to have been dropped from the latest version of the document.

The scaling back of the plans reflects pressure from some Tory MPS over how Boris Johnson will deliver his pledge to make the UK a “net zero” carbon emitter by the year 2050.

Opinion polling suggests broad support for tackling climate change but backing drops when voters are faced with personal costs that could be linked with making the UK economy greener.

The plans will still seek to bring in emissions trading for the marine sector and waste incinerati­on, which could ultimately force up costs for shippers and councils.

The door will also be opened to creating a trading emissions scheme for the agricultur­al industry with a new push to measure carbon emissions there.

However, Government figures continue to argue that no decision has been taken on capping emissions in agricultur­e, given the political sensitivit­y of adopting what critics dub a “meat tax”.

The UK Emissions Trading Scheme sees carbon emissions capped in certain sectors, putting a price on each tonne of carbon dioxide or its equivalent.

The cap is then lowered over time, increasing the price and encouragin­g businesses, and consumers, who can see the price rise passed onto them, to use cleaner energy sources.

The scheme, which came into place this January and replaced a European Union version, is seen as a critical way of the UK hitting its net zero ambition by encouragin­g change.

The plan currently applies to energy intensive industries, the power generation sector and aviation but the Government is looking to expand its scope.

Plans that the scheme would apply to vehicles and heating leaked in July to The Times, with suggestion­s that average car and energy bills could each increase by £100 a year or more.

But both elements have now been removed from the consultati­on, The Telegraph understand­s, despite the sectors contributi­ng a major proportion of overall UK emissions.

A version of the consultati­on circulatin­g in September accepted that bringing in a carbon trading scheme for heating fuel would have seen costs passed on to consumers.

It also contained a warning that three million “fuel poor” families in England would be among the worst impacted by such price increases.

The so-called “fossil fuel emissions trading scheme” had been due to begin in 2023 but has now been dropped.

A call for evidence about “how emissions can be [measured], reported and verified” when it comes to agricultur­e and land use continues to be in the plan.

The move will be seen as a step towards a cap and trade scheme for the sector, with better informatio­n needed before any decision on implementa­tion is taken.

Government figures are insistent that the formal position for now remains that there are no plans to bring in emissions trading for the sector.

‘Support for tackling climate change drops when voters are faced with personal costs ‘

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