At least, I can\’t see how it could possibly work.
The permits for CO2 emissions are an EU thing, the EUTS.
But that means we\’re not allowed to distinguish between English and French carbon, Polish and Latvian. Which is something of a problem if one country unilaterally decides to try and have a minimum price for carbon.
So, the UK says carbon is £15 a tonne and not a penny less. But the other countries allow the market to do its thing and decide the price. Say, € 9.
So anyone in the UK needing a permit can go and buy it at €9. They don\’t need to pay £15. Similarly, anyone elsewhere with a permit to sell would like to sell it in the UK at £15 rather than the € 9 they can get for it elsewhere.
And no, we\’re not allowed to stop anyone doing this, free trade within the EU remember?
So how can this possibly work? No one will ever buy UK permits unless the price is over £15….which makes the floor irrelevant anyway. And no one will ever buy a UK permit if the market price is below £15.
Unless, unless, the UK government steps in and acts as a market maker with a minimum guaranteed price of £15. Which would be truly insane as every permit in Europe would immediately be sold to the UK government as soon as the market price was below £15.
Is there anyone out there who can explain to me how this is going to work? Please?