Energy and Climate Change

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The UK chemical industry faces challenges due to high and rising energy costs, impacting its international competitiveness. Despite success in deploying renewable electricity, the industry now faces higher prices compared to global competitors due to pass-through costs including carbon pricing, renewable power subsidies, and network capacity increases. The sector relies on lower gas prices for competitiveness, but fears rising costs if asked to pay for decarbonising the heat supply like the electricity grid.

The CIA collaborates with members, government, and regulators to insulate the industry from energy transition costs while transitioning to a net-zero energy system. To mitigate emissions, the industry plans fuel-switching to hydrogen or electricity and retrofitting carbon capture equipment. CIA works to ensure supportive policies for these investments and to prevent net-zero transition costs from harming manufacturers.

Position Statements

Exempt industry from the Energy Savings Opportunity Scheme (ESOS)

2026-03-26T14:22:00+00:00

The Government has a goal of reducing business administrative burden by 25% yet it continues to load new energy use reporting requirements on manufacturers, without clear benefits for energy reduction or decarbonisation. High energy cost in the UK means that energy intensive chemical manufacturers are already pulling every lever to preserve their competitiveness through investment in energy efficiency. Moreover, they already comply with existing commitments under multiple regulatory schemes. The Government must act to streamline existing energy reporting requirements, targeting a single route to compliance and a coherent policy framework that enables industrial decarbonisation. In the meantime, energy intensive industry should be exempted from the Energy Savings Opportunity Scheme (ESOS).

Position Statement
How should the UK respond to the EU Industrial Accelerator Act?
The European Commission’s new Industrial Accelerator Act (IAA) marks a significant escalation in Europe’s efforts to drive low‑carbon industrial growth and strengthen its manufacturing base. By creating demand for cleaner, European‑made technologies and streamlining deployment, the IAA aims to accelerate decarbonisation while supporting competitiveness, investment and jobs across the EU. As these proposals move into negotiations, they signal a clear shift in the global race for clean industrial investment and set an important benchmark for the UK’s own approach to industrial decarbonisation.
Position Statement
Aligning the UK ETS with Net Zero policy
The UK Emissions Trading Scheme (UK ETS) is the UK’s primary industrial decarbonisation policy instrument. By setting a limit - a ‘cap’ - on emissions from industrial sectors, and creating a market to buy and sell emission allowances under that cap, the UK Government says the scheme is intended to ...
Position Statement
Gambling on our low carbon future: Finance and the UK ETS
The UK Emissions Trading Scheme (UK ETS) is one of the UK’s key industrial decarbonisation policies. It works on a ‘cap-and-trade’ principle. A cap is set on the total amount of greenhouse gases that can be emitted by sectors covered by the scheme. The cap is then reduced over time ...

Be part of it

Members are invited to get involved with our various energy and climate change strategy groups, networks and issue teams, which include: Energy and Climate Change Policy Network, Industrial Emissions Policy Issue Team, Sustainability Strategy Group , Environment Network.

For further information, or to express an interest in joining, please contact our team Nishma Patel at PatelN@cia.org.uk or Rich Woolley at WoolleyR@cia.org.uk.

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