ABSTRACT
Carbon trading is currently the central pillar of the Kyoto Protocol and other international agreements aimed at slowing climate change. Emissions trading are a market-based approach used to control pollution by providing economic incentives for achieving reductions in the emissions of pollutants. Carbon emissions trading are a form of emissions trading that specifically targets carbon dioxide. A carbon floor price is therefore primarily designed to attract low carbon investment into a country by making the price of pollution higher and increasing the rewards for low carbon projects. This chapter discusses the carbon trading in the UK and how does the EU Emission Trading System (EU ETS) work. The Carbon Reduction Commitment Energy Efficiency Scheme (CRC) was introduced in 2010 following years of design and many rounds of consultation. Qualification for the scheme is based on electricity supply across organizations and groups of undertakings, rather than at an individual site basis.
