My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I draw attention to my interests as set out in the register.
My Lords, the UK Emissions Trading Scheme replaced the UK’s participation in the EU Emissions Trading Scheme on 1 January 2021. The UK ETS applies to energy intensive industries, power generation and aviation. In the energy White Paper we
“committed to exploring expanding the UK ETS to the two thirds of uncovered emissions”,
and we will set out our aspirations in due course.
I thank the Minister for his Answer, but could he give the House some indication of the timescale in which the Government intend to bring shipping within the UK ETS? If they do not intend to do so, what alternative approach will they take to curtailing maritime emissions, which are currently forecast to rise by 50% by 2050?
I recognise the points the noble Lord makes and he will be aware that, in the transport decarbonisation plan, there is a commitment to assess how economic instruments could be used to accelerate decarbonisation measures alongside all the other aspirations of the plan.
How do the Government intend to respond to the report from the Climate Crisis Advisory Group on carbon pricing, which says that emissions reductions from the advanced economies fall far short of what has been promised? I quote:
“Much stronger policy action across all sectors is needed”.
In particular, can he indicate the Government’s intention on a carbon border adjustment mechanism, and whether such a mechanism could raise nearly €10 billion a year as the Financial Times has claimed?
Of course, these matters are never as simple as the noble Baroness makes out. Building on the previous Answer from my noble friend Lord Agnew, I say that it is important to recognise that the UK is proceeding faster than any other G7 country in our decarbonisation efforts. I am aware that the EU is looking at a carbon border adjustment mechanism—we will see if it happens or not—and of course we will look at the proposal.
Are the Government supportive of the citizens’ climate assembly recommendation to introduce a frequent flyer levy? This would fit well with the polluter pays principle, which Ministers have advocated previously at the Dispatch Box, and the burden would fall on those most able to pay, something I am sure the Minister would deem fair.
Clearly the Government have not thought through the present crisis. So often it is the poorest throughout the world who bear the brunt of climate change. How will the Government apportion costs for the UK ETS to cover all forms of transport?
The effect on poor people, including in the UK, will be one of the factors that we will need to consider when expanding the ETS. These are important fiscal measures. We will need to look at them properly and consider all the implications, and we will set out our thinking in due course.
My Lords, as the Minister pointed out, these schemes cover energy-intensive businesses. However, if the disorderly situation that is currently under way continues, manufacturers of ceramics, steel and cement—energy-intensive businesses—will not have any emissions to trade because they will have collapsed. Can the Minister clear up what is happening? Have talks between BEIS and the Treasury happened, as the Secretary of State said yesterday, or was the Treasury right that no talks have happened? When will the Minister let us know what is going on? Can the Government clear up this mess?
I agree with the comments made by my Secretary of State yesterday. There are always ongoing discussions between government departments on a huge range of measures, and I am sure that the Treasury and BEIS will be closely involved in further discussions.
My Lords, at the start of the pandemic last year, as a result of the lockdowns there was a significant problem in developing countries around the world in trading, due to the lack of access to shipping and other forms of freight. This problem could be exacerbated by the correct action to reduce and—I hope—eliminate emissions. Will the Government ensure that the COP 26 summit in Glasgow delivers enough funding and other forms of support to developing countries to make sure that there can be a just transition?
Again, in this matter we are leading with the funds that we have supplied to developing countries and we have promised. The Prime Minister and the joint president at COP are engaged in discussions as we speak, to try and drive up the commitment of developed countries to help lower-developed countries with their aspirations.
My Lords, air is the most polluting of all modes of transport, and most air transport is excluded from the UK Emissions Trading Scheme because it is international. Will the Minister confirm that he is working hard to bring CORSIA—the Carbon Offsetting and Reduction Scheme for International Aviation—within the scheme and make some positive announcement for COP 26?