The UK government announced on Jan. 18 that it will not intervene to curb costs under the UK Emissions Trading System, following a similar decision in December. The decision implies that the market will be left to operate without intervention in January, although future action may be taken if prices rise too quickly.
In October, November, and December, UK Allowance prices averaged above the January 2022 trigger level of £56.58/mt CO2e ($76.87/mt), prompting a meeting of the UK ETS Authority to consider taking measures in January.
The government published a statement after the market closed on Monday, saying, “Following the triggering of the UK ETS's Cost Containment Mechanism at the beginning of January, the UK ETS Authority has concluded that the appropriate course of action at this time is not to redistribute or release additional supply into the scheme's market.”
