8th Report - The Seventh Carbon Budget

The government commits to proposing to Parliament that the seventh carbon budget be set in line with the Climate Change Committee’s recommended level of 535 MtCO₂e. A cross-government process will follow to develop the delivery pathway and new policies, considering the Committee's suggestions.

The government states its commitment to ambitious climate action, guided by international cooperation and the Paris Agreement, and highlights that the Carbon Budget 7 Impact Assessment articulates how the chosen CB7 level is credibly aligned with pathways to limit global temperature increase to 1.5 °C.

The government states that the analysis published within the Carbon Budget 7 Impact Assessment articulates how the chosen CB7 level aligns credibly with pathways to limit global temperature increase to 1.5 °C, thereby addressing its Paris Agreement obligations.

The government agrees on the urgency and states that DESNZ already provides cross-government leadership on net zero communications, citing recent campaigns, a new Clean Energy website launched in September 2025, and an annual statement to Parliament as evidence of their commitment to clear public messaging.

The government agrees on the importance of resilience and states its plans already prioritise early, high-confidence emissions reductions, with Greenhouse Gas Removals (GGRs) used to balance residual emissions; it will consider GGR Independent Review recommendations and set out the role of GGRs in a future delivery plan.

The government agrees with the recommendation and is committed to preventing carbon leakage. It will gradually phase out free allocations for sectors covered by the UK Carbon Border Adjustment Mechanism (CBAM) from 2027, over an indicative 9-year period, to work with the introduction of the UK CBAM.

The government agrees that climate policies must prevent offshoring and support UK industry competitiveness. It highlights its commitment to decarbonise industry, existing investments, and specific policies like the UK ETS and the gradual phasing out of free allocations with the introduction of the UK Carbon Border Adjustment Mechanism from 2027.

The government agrees that policies must support domestic decarbonisation and prevent carbon leakage. It highlights existing commitments, the UK Emissions Trading Scheme, and the gradual phasing out of free allocations for sectors covered by the UK Carbon Border Adjustment Mechanism from 2027, with the delivery plan setting out how these measures will operate together.

The government agrees on the importance of preventing emissions offshoring and supporting UK industry decarbonisation. It commits to gradually phasing out free allocations for UK ETS sectors covered by the UK Carbon Border Adjustment Mechanism (CBAM) from 2027, over nine years, and states the full package of measures will be detailed in the CB7 delivery plan.

The government agrees with the recommendation and commits to ensuring climate policies do not drive offshoring. It states that the delivery plan will set out how key policy mechanisms, including electricity price support, infrastructure, and carbon pricing, will operate together during the CB7 period to support domestic investment and manage carbon leakage.

The government accepts the recommendation, detailing that free allocations under the UK ETS will be gradually phased out for CBAM-covered sectors from 2027 over an indicative nine-year period, and commits to monitoring the effectiveness of this transition and interaction.

The government accepted the recommendation, stating it laid a statutory instrument on 14 April 2026 to formally include international aviation and international shipping emissions in Carbon Budget 6, all subsequent carbon budgets, and the net zero target.

The government states that co-benefits are already central to its decarbonisation approach and will continue to guide future plans. It highlights ongoing engagement initiatives, plans to launch an annual Energising Britain event in 2026, and is creating a new Youth Climate and Nature Panel under the Net Zero Council.

The government states that co-benefits were already central to its decarbonisation approach and will continue to guide future plans. It describes pursuing policies for tangible improvements and is committed to ongoing inclusive engagement, launching an annual Energising Britain event in 2026, and creating a new Youth Climate and Nature Panel.

The government states that its published Impact Assessment and equality analysis already consider distributional impacts and fairness in the net zero transition, and that further impacts will be considered in detail as part of developing the CB7 delivery plan.

The government states it has already moved legacy costs from electricity bills to the Exchequer and taken other actions to reduce electricity costs. It is expanding the British Industrial Competitiveness Scheme, accelerating its £15 billion Warm Homes Plan with an uplift to the Boiler Upgrade Scheme, and providing an additional £100 million for the Warm Homes: Social Housing Fund.

The government does not commit to publishing a separate Fairness and Distribution Assessment, but states it has already published an Impact Assessment with distributional analysis and an equality analysis, and that further impacts will be considered as part of developing the CB7 delivery plan.

The government highlights its focus on co-benefits and inclusive, participatory approaches for decarbonisation. It commits to launching an annual "Energising Britain" event in 2026 and creating a new Youth Climate and Nature Panel under the Net Zero Council to ensure engagement and embed intergenerational perspectives in policymaking.

The government acknowledges the crucial role of local authorities and outlines several concrete actions, including continued and integrated funding schemes, the establishment of a Warm Homes Agency, and the development of a local net zero framework to provide clarity on their role.

The government reiterates that the Climate Change Act already includes mechanisms for parliamentary scrutiny of carbon budgets, such as debates and approval, and states its approach will align with these statutory duties. It welcomes the Committee's suggestions, noting they will be considered during the development of the CB7 delivery plan.