To ask the Secretary of State for Foreign and Commonwealth Affairs what recent representations he has received from his counterparts in the EU on the operation of the Emissions Trading Scheme; and if he will make a statement. (191174)

I meet regularly with EU counterparts on a range of issues, including the EU Greenhouse Gas Emission Trading Scheme (ETS), as do my Ministerial and policy colleagues. Currently the UK is working with EU partners, including the Commission, to review how the EU ETS can best deliver the necessary reductions in emissions beyond 2012. The UK view is that the review should be ambitious, delivering real emissions reductions (ie 20 per cent. or 30 per cent. as part of an international negotiation) by 2020, as agreed at the spring Council 2007, greater harmonisation and long-term certainty, and maximise its potential to stimulate investment in low-carbon technology. The Commission’s proposal for a revised EU ETS from 2013 was discussed by EU Environment Ministers at the Environment Council on 3 March and will also be discussed by EU leaders at the spring European Council on 13-14 March.

The Government agree with Sir Nicholas Stern that a global price for carbon is essential if we are to achieve a low carbon economy. The EU ETS and other mandatory emissions trading schemes being developed around the world are crucial stepping stones towards this. It is a major pillar of both UK and EU climate change policy and is the primary market based mechanism in the fight against climate change. It is fundamental to reducing greenhouse gas emissions by keeping emissions within agreed limits while allowing emission reductions to be made at least cost through trading of allowances.