UK ETS Free Allocation Review

Closed 11 Mar 2024

Opened 18 Dec 2023


The UK Emissions Trading Scheme (UK ETS) Authority (UK Government, Scottish Government, Welsh Government and the Department of Agriculture, Environment and Rural Affairs for Northern Ireland, hereinafter ‘the Authority’) is seeking input on a number of proposals to improve our approach to free allocations.

We have committed to better target free allocations for sectors most at risk of carbon leakage ahead of the next allocation period in 2026, and to tailor this to the UK context. This consultation seeks views on our proposals to meet these commitments. It proposes options for changes to the free allocation methodology including:

  • The approach to accounting for activity
  • Benchmarking
  • The way we assess carbon leakage risk
  • Additional aspects of methodology such as consideration of decarbonisation technologies and conditionality
  • Technical proposals to improve operability and deliverability of the scheme.

Read the consultation document on GOV.UK


  • SMEs (small and medium businesses)
  • Large businesses (over 250 staff)
  • Multinational businesses
  • Trade bodies
  • Legal representative
  • Medium business (50 to 250 staff)
  • Micro business (up to 9 staff)
  • Small business (10 to 49 staff)
  • Oil and Gas
  • Wind
  • Nuclear
  • Coal
  • Wave and tidal
  • Low carbon technologies
  • Construction
  • Manufacturing
  • Technology (R&D)
  • Regulator
  • The Devolved Administrations
  • Non-Government Organisations


  • Energy and climate change