Britain’s cement, steel and aluminium industries could lose competitiveness under the EU emissions trading scheme, a new report from the Carbon Trust said today.
The trust recommended that these industries receive free allocations for a short time, to give them time to decarbonise their industries.
But it said that the rest of Britain’s construction and heavy manufacturing businesses would face little or no problems from the scheme.
Trust chief economist Michael Grubb said: “Businesses constantly face external impacts on pricing and competitiveness, be it from exchange rate fluctuations or differences in the cost of labour or raw materials.
“For more than 90 per cent of manufacturing industry, carbon costs will remain trivial compared to these other influences on international competitiveness.”
The EU intends to cut carbon emissions by 20 per cent by 2020.