Guidance for UK Emissions Trading Projects - Advice to Policy Makers

A report for the Department of Trade & Industry

October 2002

This study has been commissioned by the UK Department for Trade and Industry (DTI) with the aim of ‘Developing Guidance for UK Emissions Trading Projects’. There have been two phases to the study. The first phase consisted of a review of the range of possible methodologies for assessing the carbon reductions arising from Greenhouse Gas (GHG) emission reduction projects and some packages of measures in the Phase 1 report 'Advice to Policymakers'. The second phase built upon the work in Phase 1 with the aim to provide further policy guidance on carbon accounting modalities for GHG emission reductions from projects.

This Policy Document represents one part of the output from Phase 2 of the study and is supported by a Technical Document, which reports the analysis in more detail.The study is co-ordinated by the Centre for Environmental Strategy (CES) at the University of Surrey and involves the Joint Implementation Network (JIN) in the Netherlands and the Science Policy Research Unit (SPRU) at the University of Sussex. The UK government specified a list of policy questions to help them take decisions regarding the main design elements involved in accounting for the carbon emission reductions produced by projects. In trying to answer these questions, a detailed analysis has been carried out on six case study projects in the priority sectors. These sectors were specified by the government at the start of Phase 1 of the project as Transport, Built Environment, Methane, Combined Heat and Power (CHP) and Electricity Supply.

The main focus of the study is on issues of additionality, both in the sense of policy additionality and also the wider additionality of the projects and the relationship between additionality and baselines. However, project boundaries, leakage and monitoring and verification issues are also addressed. In the process some aspects of the practicalities involved in operationalising these projects are considered and an example of possible general guidance has been produced.

Case study projects were provided by firms in the priority sectors after a series of meetings with sector representatives. From this set of projects the government chose six projects in the transport, built environment and methane sectors for further analysis as there have been very few studies in these sectors.

The report can be viewed/downloaded from: policydocumentUKETSfinal1.pdf