Addressing carbon leakage risk to support decarbonisation

On 30 March, the government published an exploratory consultation considering a range of potential policy measures to mitigate carbon leakage risk in the future and ensure UK industry has the optimal policy environment to decarbonise. Potential policies include a carbon border adjustment mechanism (CBAM), mandatory product standards (MPS), and other policy measures to help grow the market for low carbon products, as well as emissions reporting which could support the implementation of potential mitigation policies.

Responses should be provided online (preferred) or by email to carbonleakage.consultation@beis.gov.uk.

This consultation is open to all interested parties both in the UK and internationally, but we anticipate it will be of particular interest to:

• Companies and representatives from industry and business including trade associations;
• Importers and exporters of products, including small and medium-sized enterprises, supply chain businesses, software houses and customs agents;
• International partners and multinational groups;
• Financial Reporting and Enterprise Resource Planning System providers;
• Companies and representatives in all other sectors with an interest in climate policy, including academia, thinktanks, cross-sector groups, and non-governmental organisations;
• Private citizens.

This consultation is set out in two parts. Part 1 sets out potential measures that the government could introduce to mitigate the carbon leakage risk in future. Part 2 sets out proposals on design and delivery features of embodied emissions reporting that could underpin future carbon leakage policy measures.

• The UK ETS Authority sought views on the development of the UK Emissions Trading Scheme (2022): Developing the UK Emissions Trading Scheme (UK ETS)

• A Call for Evidence (2021) in which the design and implementation of policies to encourage the market for the growth of low emissions industrial products were explored: Towards a market for low emissions industrial products: call for evidence

• The strategy (2021) that sets out how industry can decarbonise in line with net zero while remaining competitive and without pushing emissions abroad: Industrial decarbonisation strategy

• The HM Treasury Net Zero Review Final Report (2021) considers factors associated with risk of carbon leakage: Net Zero Review Final Report

Please note that your responses will be shared across government, unless you specify your information is private.

Read the BEIS consultation privacy notice.