The UK's commitment to achieving net-zero emissions by 2050 requires a significant reduction in carbon emissions from businesses. The UK's implementation of an Emissions Trading System (ETS) is a step in the right direction, but without full alignment with the EU ETS framework, businesses may face additional costs.

27. The UK Government should engage in negotiations with the EU to establish a formal link between the UK and EU ETS, enabling the mutual recognition and trading of allowances between the two systems. The necessary legislative and regulatory measures should be implemented to enable this linkage, including provisions for ongoing monitoring, review, and dispute resolution.