UK ETS Authority Discloses Voluntary MRV-Only Phase for Energy-from-Waste Initiating in 2026

On July 21, 2025, the UK Emissions Trading Scheme (UK ETS) Authority announced its intention to implement a voluntary monitoring, reporting, and verification (MRV)-only phase for energy-from-waste (EfW) and waste incineration facilities, effective January 1, 2026. This decision follows the Authority’s consultation conducted in May 2024 regarding the integration of the waste sector into the UK ETS.

The MRV phase aims to provide operators with the opportunity to familiarize themselves with compliance requirements before mandatory inclusion. The scope encompasses direct emissions resulting from EfW processes, waste incineration, and specific chemical recycling activities exceeding designated capacity thresholds, along with monitoring through Carbon-14 analysis and emissions factor calculations.

The interim response indicates that the current thresholds for Hospital and Small Emitters (HSE) and Ultra-Small Emitters will remain applicable, with exemptions for high-temperature hazardous waste incinerators and clinical waste processing facilities, as well as persistent organic pollutants currently under consideration. Although the voluntary period will not be subject to monitoring or enforcement, its framework will align with the UK ETS compliance cycle, allowing operators to test various reporting methods while the Authority continues to refine its strategies.

In light of concerns expressed during the consultation, the Authority confirmed that measures will be implemented to prevent the unintended increase of landfill waste resulting from cost-avoidance tactics or the relocation of waste to regions with lower disposal costs. Local authorities will not be required to fully finance the transition of the waste management sector to the UK ETS. Guidance about the MRV-only phase is anticipated before January 2026, with the final policy design to follow thereafter.