EU and UK Forge Path to Link Carbon Markets

EU nations have agreed to initiate discussions with the UK to connect their carbon markets, a move seen as a step towards mending post-Brexit relations. The linkage aims to exempt each other from carbon border tariffs, though it won't happen soon enough to prevent UK's exposure to EU levies.

In a significant development, European Union countries have reached a consensus to commence negotiations with the United Kingdom to connect their carbon markets, a spokesperson for Denmark's EU presidency confirmed on Wednesday. This initiative is perceived as a strategic effort to reset relations post-Brexit.

The proposed linkage would allow the two regions to exempt one another from respective carbon border tariffs. Nonetheless, the connection is not likely to be established in time to prevent British companies from facing the EU's carbon border levy, which will soon apply to imports of steel, cement, and other products starting January 1.

While EU countries' ambassadors have unanimously supported the negotiations in a confidential meeting, the formal EU mandate is awaiting approval at the upcoming ministers' meeting. The linkage has garnered support from both European and UK industries, as it promises to sidestep the hefty EU levy projected to cost UK businesses £800 million annually.

(With inputs from agencies.)