To: Lord Deben, Chairman of the Committee on Climate Change
From: Rt Hon. Edward Davey MP, Secretary of State for Energy and Climate Change
The UK’s 2050 target to reduce emissions by at least 80% relative to 1990 requires that emissions are reduced across the economy.
The carbon budgets (currently legislated to 2027) set the path towards that target. They have been set reflecting the need to reduce emissions across the economy. They were based on the best understanding, at the time they were set, of how the UK’s emissions would be counted under the EU’s Emissions Trading System (EU ETS), the actions required in the sectors covered by the EU ETS (power generation and heavy industry) and the actions required in the rest of the economy (e.g. transport, other industry and commerce, buildings, agriculture).
Since the carbon budgets were set the actual allocation of emissions reduction under the EU ETS has been agreed. It differs from what was thought when the carbon budgets were set. As a result, those original budgets no longer reflect the intent, under the Climate Change Act, to reduce emissions across the whole economy to meet the 2050 target.
Following a request from the Secretary of State for Energy and Climate Change, the Committee have exchanged letters on this issue:
- A letter from the SofS raising the issue relating to the EU ETS and requesting the Committee’s advice
- The Committee’s advice, highlighting the need to preserve effort in the non-traded sector of the economy if the 2050 target is to be met in line with the legislation
- The SofS’s response, reiterating the intention to meet the 2050 target through action across the economy