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Business, government and the environmental lobby have today joined forces and called on European industry and governments to work together to secure a sound footing for the future of the carbon trading market. The UK Manifesto on the EU Emissions Trading Scheme, published today, has been signed by over 40 businesses and NGOs and sets out how the UK wants to see the emissions trading scheme develop after 2012. The publication comes ahead of this week's meeting of EU heads of state in Brussels where climate change will feature high on the agenda.

Environment Secretary David Miliband said:

"Emissions trading is a crucial part of our efforts to tackle climate change. It already covers nearly half the carbon emitted in the UK. We were right to push for ambitious caps last year, and we want to continue to offer ambitious leadership within the EU. This is why it is important that the EU ETS proves to be effective. This manifesto not only shows the high level of consensus in the UK around the merits of the EU's emissions trading scheme - but also its design post-2012.

"Businesses rightly want long term certainty to influence their investment decisions. EU environment ministers have responded positively to this call by agreeing to challenging emissions cuts up to 2020. It will be for heads of state to back up this commitment later this week and agree to stretching targets for tackling greenhouse gas emissions. This will not only cut emissions in the EU, but strengthen Europe's leadership in seeking a global climate deal."

Trade and Industry Secretary Alistair Darling said:

"British business is backing words with action on the environment.

''The EU ETS is a key part of reducing carbon emissions, but to be effective it needs to work across Europe with demanding targets.

"It is important for current and future energy investment, that industry has a clear long term policy framework for the EU ETS post-2012. We are determined to work hard with Europe to deliver the long term certainty they need."

Backing the manifesto, John Cridland, CBI Deputy Director General, said: "Companies are determined to help tackle global warming and environmental issues - the CBI's Climate Change Taskforce is proof of that - but they need a framework for the future.

"It is essential that the leadership and ambition shown in the UK in supporting the ETS and cutting emissions is matched by other EU countries. The system is not perfect but must not be derailed by a lack of commitment from other states - the European Commission has a key role to play here."

Keith Allott, WWF-UK Head of Climate Change, said:

"A successful EU ETS will be central to delivering the deep emissions cuts needed to avoid dangerous climate change. But this is a critical time for the scheme - the first phase is not delivering significant emission reductions in Europe and the jury is still out on the next phase which starts next year. If the ETS is to help put Europe on to a low carbon path, business and governments must now support clear and ambitious targets beyond 2012."

Ian Rodgers, Director of UK Steel added:

"A well designed emissions trading scheme helps manufacturing deliver carbon reductions at least cost to its international competitiveness. I particularly welcome the manifesto's recognition that sectoral arrangements offer a potential pathway for the future." The manifesto calls for:

• Long term clarity for business to enable it to judge the scale of investment required and to make the right, low carbon, investment decisions.
• n the long run, for all business activities to be exposed to the full cost of carbon.
• Governments to set out the path to this fully costed carbon economy.
• Further harmonisation of rules throughout the EU - essential to create a fair and level playing field for industry.

NOTES TO EDITORS

The Manifesto and its signatories can be found at: http://www.defra.gov.uk/environment/climatechange/trading/eu/future/index.htm All signatories signed up to the manifesto as a consensual summary of the key issues.

Emissions trading sets a cap on carbon emissions from European industries. Under the scheme, installations that emit less carbon than their allocation are able to sell allowances on the newly established carbon market to installations which need to buy allowances to cover extra emissions. Putting a price on carbon creates an incentive for industry to invest in low carbon technology.

The future design of the EU Emissions Trading Scheme will be negotiated as part of the review of the EU ETS directive. The European Commission is currently discussing the future of the scheme with Member States Governments and stakeholders, and is expected to publish a proposal later this year. The Commission have flagged up priorities for the review of the scheme: scope; robust compliance and enforcement; harmonisation and increased predictability; and linking.

On 20 February EU environment ministers approved a new set of greenhouse gas emissions targets to be met by 2020. The EU decided to make a firm independent commitment to achieve at least a 20% reduction of greenhouse gas emissions by 2020 compared to 1990, and is willing to commit to a reduction of 30% of greenhouse gas emissions by 2020 compared to 1990 as its contribution to a global and comprehensive agreement for the period beyond 2012 (provided that others make comparable commitments). This helps to provide the certainty requested in the manifesto in the level of ambition post-2012.