The UK has introduced a bill to allocate free EUAs to installations that had already opted out of the EU ETS but must return to the scheme because their emissions have exceeded exemption limits.

The move follows a summer consultation where respondents broadly agreed with the proposed measure, the UK energy and climate change ministry said in a note on its website.

“Taking these responses into account, we have not revised the Greenhouse Gas Emissions Trading Scheme (Amendment) Regulations 2015, and these were laid before the Houses of Parliament in early November 2015,” it said.

The bill aims to update a 2013 law to allow hospitals and other ETS installations with emissions below 25,000 tonnes of CO2e per year to exempted if they made equivalent abatement commitments.

It also aims to clarify existing rules for when an ETS installation is judged to have permanently closed rather than temporarily shut. Mothballed plants are still entitled to receive free EUAs.

The EU Commission’s post-2020 ETS reform proposal included provisions for member states to continue to exempt small emitters with high EU ETS administration costs if they make equivalent contributions to cut emissions, and to add more SMEs to that list from 2021.

By Ben Garside – ben@carbon-pulse.com