The Environment Agency (EA) is urging companies to start planning their permit applications for the EU greenhouse gas emissions trading scheme.
Companies affected by the regulations must receive a permit from the EA by 31 March 2004, the deadline for presentation of the National Allocation Plans. To ensure permits are received on time, the agency stresses companies must apply for the permits between 10 November 2003 and 31 January 2004. If failing, companies may not be able to obtain the carbon dioxide allowances by Defra, required to emit the greenhouse gas from 1 January 2005.
The principle behind the trading scheme is called ‘cap and trade’ with the government setting a cap on CO2 emissions, divided between businesses and organisations. The amount they receive is a tradeable allowance. CO2 efficient companies can trade the remainder of ‘unused’ allowance with companies that require an addition to their allowance. The scheme, which starts 1 January 2005, will cover over 40 per cent of European CO2 emissions.