LONDON, 16 June - As the UK prepares to vote in a referendum on EU membership, IETA warns against the negative consequences a "leave" vote would have on the reforms of the EU ETS and the EU’s international leadership on climate policy.
The UK has a long history of supporting and leading efforts on emissions trading within the EU, dating back to the introduction of the UK ETS in 2001 and the adoption of the EU Emissions Trading Directive in 2005. Without the early support and leadership of the UK on emissions trading, Europe would not be recognised as a world leader on climate change policy today.
IETA believes the UK’s position at the EU table is vital during a critical time of policy development on the future of carbon markets in Europe and abroad. As part of the EU, the UK is poised to offer leadership to the legislative process to improve the EU ETS and to the international carbon market negotiations underway at the UNFCCC.
IETA highlights three key reasons why the UK should remain in the EU and continue its role in shaping both international and European climate policies.
- The UK brings solid experience, reputation and credibility to pro-market discussions on the EU ETS and international carbon markets—thanks to efforts by the Department of Energy and Climate Change and UK MEP’s. The UK is the major centre for Europe’s carbon, energy and financial markets, so its involvement in European policymaking in these areas is essential. A large pro-markets void would emerge in Brussels if the UK were to leave.
- More specifically, policymakers in Brussels are currently discussing ways to reform and improve the performance of the EU ETS. Not only would a Brexit vote undermine these efforts, it would also make reforms more difficult, given the added complexity of how to restructure the UK’s involvement in Europe’s carbon market – which is significant given the UK’s current commercial role.
- The UK has been a solid supporter of international carbon markets at the UNFCCC and was instrumental in delivering Article 6 of the Paris Agreement, which lays the foundation for international carbon markets to emerge in the future. Without the UK’s involvement in the EU negotiating team at the UNFCCC, Europe’s support for international carbon markets could lose strength.
IETA will respect the result of the 23 June referendum and work with its partners in the UK no matter what the outcome, but we strongly warn against the risks for the EU ETS and EU leadership on climate policy that would come with Brexit.
