The UK is taking a significant step toward integrating carbon removals into its Emissions Trading Scheme (UK ETS), with the UK ETS Authority announcing plans to legislate for inclusion by the end of 2028, targeting full operational integration by 2029.
In its official response to a public consultation that ran from May to August 2024, the Authority outlined a framework designed to support a credible, long-term market for carbon removals.
More than 160 organizations — from industry, finance, academia, and the land-use sector — contributed to the consultation.
Marco Magini, Executive Director, Certificates at South Pole, a leading carbon asset developer, has commented by saying: “The UK’s move to integrate tech carbon removals into its ETS is a clear signal that removals aren’t just a nice to have – they’re essential for hitting net zero. Reaching global climate targets means cutting emissions and removing carbon at scale.
Backing tech solutions like direct air capture and BECCS through policy is exactly the kind of signal needed to unlock investment and drive the innovation we need. It’s another important step forward for high-integrity carbon markets – and comes hot on the heels of the EU’s decision to include removals in its own ETS.”
Key decisions include awarding carbon allowances to greenhouse gas removal (GGR) operators ex post, only after verified and durable carbon sequestration has occurred.
Projects must demonstrate a minimum carbon storage duration of 200 years to qualify, and only removals that take place within the UK will be eligible during the initial integration phase.
Importantly, the Authority confirmed that the gross cap — the total number of allowances in the system — will be maintained, ensuring that removals do not dilute overall ambition. The Authority is also considering the creation of differentiated removal units, distinct from current UK emissions allowances (UKAs), though final decisions will follow further technical assessments.
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To support market access for removal developers, the Authority plans to introduce dedicated auctions and transitional supply controls aligned with the UK’s net zero trajectory.
However, no final decision has yet been made on whether high-quality woodland-based removals will be included. The Authority has committed to publishing new evidence and continuing stakeholder engagement on this question later in 2025.
These developments mark the UK as one of the first countries to formally plan for the integration of engineered carbon removals into a compliance carbon market.
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The move is expected to strengthen investor confidence and accelerate deployment of high-integrity GGR technologies as the UK pushes toward its 2050 net zero target.
Mike Maudsley, CEO of enfinium, a leading UK energy-from-waste company, commented: “The UK has demonstrated a world leading ambition to include carbon removal projects in the UK Emissions Trading Scheme by the end of 2029. This will significantly boost the economic case for waste to energy carbon capture facilities, which could generate millions of tonnes of high-integrity carbon removal credits to mitigate emissions elsewhere in the economy.
“The waste sector’s ‘MRV-only’ period in 2026 and 2027 provides a welcome opportunity for the waste industry to work with government and local authorities to ensure that a fair and accurate approach to monitoring emissions is developed ahead of full inclusion in the ETS in 2028.”
