Following the consultation period over the summer, DEFRA has now put before Parliament regulations to encode the EC’s directive on linking emissions trading with the Kyoto Project mechanisms. The regulations will take effect on 2005-11-13. The Government has said it will not impose any limit on the use by UK organizations of credits generated by the Kyoto project mechanisms in order to meet their commitments in Phase I (2005-7) of the EU Emissions Trading Scheme (ETS). This is good news, as it means companies may invest in approved greenhouse gas abatement projects in other countries and offset this against their UK emissions. However, limits will be applied in the subsequent phase (2008-2012).

The regulations also provide conditions for approval of Kyoto projects and for collection of data for the national registry. We will provide a detailed analysis in due course.

There is now a further consultation period, not over the regulations themselves, but on the explanatory guidance notes. The deadline for comments is 2006-01-31.

More information can be found on the DEFRA pages.

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