Jet Zero: Measures – markets and removals

The DfT’s consultation says:

3.31 UK is a leading voice and views carbon pricing as an essential lever to reach net zero – EU Emissions Trading Scheme (ETS) was launched in 2002, aviation was included from 2012

3.32 UK’s ETS introduced 2021, covering all domestic flights, flight from UK to EEA, flights between UK and Gibraltar (totalling 44% all commercial flights to & from UK airports) and consultation on total emissions cap due later this year

Carbon Markets

A carbon market, such as the UK ETS or CORSIA, puts a price on each tonne of emissions included in the market, as an incentive for participants to reduce their emissions.

The UK ETS works on the ‘cap and trade’ principle, where a cap is set on the total amount of certain greenhouse gases that can be emitted by sectors covered by the scheme and which decreases over time.

Under CORSIA, aeroplane operators offset the growth in international aviation CO2 emissions covered by the scheme above 2019 levels.

3.33 UK is influential member of UN’s ICAO, responsible for tackling emissions, and helped shape CORSIA

3.34 We will explore how to help other governments implement CORSIA

3.35 By pricing CO2, market-based measures can drive emissions reductions and implement the ‘polluter pays’ principle

3.36 Most projections suggest there will be residual aviation emissions in 2050, so we need robust way to remove them or avoid equivalent emissions elsewhere

3.37 As easier carbon reduction options become scarce, we expect offsetting to be replaces by greenhouse gas (GHG) removal methods

3.38 We will review offset market opportunities and explore GHG removal from hard-to-abate sectors

Greenhouse gas removal (GGR) and aviation

To achieve net zero by 2050, analysis from the CCC shows that a mix of engineered and nature-based GGRs will be required to balance residual emissions from aviation and other difficult-to-decarbonise sectors, such as agriculture and certain heavy industries.

GGRs are not yet implemented at commercial scale, either in the UK or globally, and forecasts of costs and scale-up potential are highly uncertain.

Existing policy commitments:

  • We will have all legislation for CORSIA in force no later than the start of UK ETS Phase I(b) in 2024, enforce it robustly and encourage other states to do the same
  • We will, in collaboration with the devolved administrations through the UK ETS Authority, work to enhance the effectiveness of the UK ETS; ensuring that aviation is appropriately considered as we consult on amending the cap to align with net zero, reviewing the sector’s free allocation, exploring expanding the pollutants covered, and making any changes that may be required to account for CORSIA
  • We will set out further details on the Government’s approach to the development and deployment of greenhouse gas removal methods, following the Government’s recent Call for Evidence
  • We will consider how the UK ETS could incentivise the deployment of greenhouse gas removal methods, in line with the Government’s commitment in the Energy White Paper
  • We will negotiate for carbon pricing to be maintained and strengthened in the international aviation sector, including /aligning the ambition of measures such as CORSIA with any long-term goal adopted by ICAO
  • We will be firm advocates within ICAO to improve the environmental ambition of CORSIA through ICAO’s periodic reviews.

Our new policy proposals:

  • We will strengthen carbon pricing for aviation to ensure we continue to apply the ‘polluter pays’ principle and consider incentives for greenhouse gas removal methods
  • We will explore how we can support other states that may need help implementing CORSIA effectively.

LADACAN comments:

Carbon caps and carbon trading schemes such as UK ETS are levers: the key question is “how effectively will the UK government use the lever given its clear commitment to letting the aviation sector continue to thrive?”

There’s still a lot of “exploring” and “considering” being proposed, rather than setting concrete targets and using incentives to ensure they are met.

As other sectors decarbonise more quickly, aviation will be left relying on offsets and carbon removal technologies. Offsetting is easy to say and difficult to achieve in the short term in a genuinely sustainable way; GHG removal is not yet proven at scale.

Consultation questions:

11 Do you agree or disagree with the overall approach for using carbon markets and greenhouse gas removal methods to drive down CO2 emissions?

12 What could be done further or differently to ensure carbon markets and greenhouse gas removal methods are used most effectively?

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