Starmer's EU net zero deal ‘to drive up energy bills'
Sir Keir Starmer is to join a European Union net zero scheme as soon as next month in a move that risks driving up energy bills for millions of households.
The Prime Minister is planning to use a summit in May to align the UK and EU emissions trading schemes as part of his 'reset' with Brussels.
Critics claimed that the move would push up the cost of producing electricity from gas-fired power plants, which are the UK's second-largest source of power – ultimately adding to the costs faced by British industry and increasing household bills.
The Telegraph understands the UK will link its own carbon credits scheme to Brussels' system as part of a plan to 'strengthen ties with Europe'.
Nick Timothy, a Conservative MP, warned that linking the schemes would cost British households an extra £112 a year in more expensive goods and electricity from gas-fired plants.
Despite the Labour Government's call for an increase in renewable energy, gas is still one of the country's largest sources of power – accounting for 26 per cent of the energy mix last year.
Emissions trading schemes (ETS) are used by the Government and EU to raise money for net zero projects.
They force carbon-emitting companies to buy credits for every tonne of greenhouse gases that they emit, adding to the cost of production and limiting Britain's carbon footprint.
Since Brexit, when the UK launched its own ETS, British carbon credits have been significantly cheaper than those in Europe, because the Government's cap on the overall quantity of emissions has been higher.
The system means that carbon-intensive industries have produced goods, including fertiliser and steel, at a lower cost.
But ministers are now planning to use the UK-EU summit on May 19 to link Britain's scheme to that of Europe, which would mean that UK companies pay the same tax to emit carbon dioxide as European firms.
The move would allow British exporters to avoid carbon import taxes imposed by the EU, but could result in a 50 per cent rise in the cost of credits.
Sources told The Telegraph that if the deal was not completed by the time of the summit in London, UK and EU leaders would announce that they intend to link their systems and have instructed officials to continue negotiations.
Last month, the Cabinet Office minister Lord Hunt said the Government was 'actively considering the case' for linking to the EU scheme, while Nick Thomas-Symonds, the minister responsible for the EU reset, has previously told MPs that joining Brussels' system is 'absolutely what the ambition is'.
The move will be met with scepticism from Conservative MPs, who argue that the UK's ambition of reaching net zero by 2050 is no longer realistic and could harm growth.
Mr Timothy described the carbon credits plan as 'mindless Milibandism' and said the Government should realise 'actions have consequences' for voters.
'Analysis shows that we could be heading towards an extra £112 on the cost of living because of European alignment,' he said.
'So long as policy races ahead of technology, this means higher energy bills, fewer jobs and weaker growth.
'If the Government signs up for the EU's cap and trade scheme, then we will lose control and allow carbon prices to hit eye-watering levels. This is going back on what was promised to voters during the election.'
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