13. The Greenhouse Gas Emissions Trading Scheme Order 2020

Part of the debate – in the Senedd at 6:40 pm on 3 November 2020.

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Photo of Lesley Griffiths Lesley Griffiths Labour 6:40, 3 November 2020

Diolch, Llywydd. I thank Members for their contributions to the debate. As I described earlier, the UK ETS will be an extremely important policy if Wales is to achieve a decarbonised and successful industrial base in the future. I am obviously aware of the concerns over the initial level of the cap and the scope of the industries to be covered. I think it's important to make the point that setting the cap and the trajectory will be a two-step process. So, the initial level of the cap is already more ambitious than if we'd remained in the EU system, and I will be taking further advice from the UK CCC in December. I'll also be working with my counterparts in the other Governments of the UK to consult on revisions to the cap, and, certainly, the point that Mick Antoniw raised about how committees fulfil their scrutiny role—that's something that I will also discuss to see how other countries are dealing with this process as well. I'm very conscious of the concerns that Members have raised in relation to the scrutiny role.

Scope extension will be considered during the first whole-system review, to conclude by the end of 2023, as Mike Hedges alluded to, and we aim to be the first emissions trading scheme in the world to set a trajectory consistent with the pathway to net zero. In the meantime, the current design provides a smooth transition for businesses facing considerable uncertainties due to our departure from the EU, and it also facilitates linking to the EU system, which is our strong preference. And I have to say it's all four countries' strong preference at the level that we deal with it, at a ministerial level; it's the best outcome for all parties. But, as Members referred to, unfortunately, the UK Government—a different department in the UK Government that I deal with—has ploughed on with the consultation in relation to the carbon tax. But I do want to assure Members that I've made it very clear that this is our preference, as have the other countries also.

In terms of the wider framework, as I promised, I will share the provisional framework outline agreement and the concordat with the relevant committees as soon as they're available. Ideally, they would have been available not just before today's debate, but before committee scrutiny alongside the legislation. However, the documents, unfortunately, are still in the clearance process. As Mike Hedges alluded to, this is outside of my control. The major policy decisions for establishing the scheme are included within the legislation. We will take no further substantive policy decisions on the ETS until the FOA and the concordat have been scrutinised by all four legislatures and finalised. It is important the Order is agreed and taken to the Privy Council in order to establish the UK ETS on 1 January 2021. So, therefore, on this occasion, I do ask Members to agree the Order before scrutinising the associated wider framework documents. Diolch.