Britain’s Emissions Trading System (ETS) began on Wednesday with prices higher than EU carbon prices at around £50 per tonne.

The ETS charges companies for the carbon dioxide they emit and encompasses British companies that were previously covered by the EU ETS before Brexit.

ICE hosted the first auction of government permits with more than 6 million UK allowances for sale and the exchange says all allowances were sold during the auction. ICE also launched UK Allowance futures contracts, equivalent to 1000 Allowances. Daily futures are due to be launched on May 21, 2021.

“The first UK carbon auction today has seen active participation by the market”, said Gordon Bennett, Managing Director, Utility Markets, ICE. “Market based mechanisms like emission trading schemes play a crucial role in helping customers reduce their carbon emissions by attributing a cost to pollution. Now, there is an enormous opportunity for cap and trade programs to take an even greater role in supporting customers’ carbon reduction goals, whether it is increasing their sector coverage or encouraging international linking.”