Climate Change Act 2008

7 (1) The regulations may enable participants to offset the carrying on of the activities in a trading period by acquiring credits representing— U.K.

(a) a reduction in an amount of greenhouse gas emissions, or

(b) the removal of an amount of greenhouse gas from the atmosphere.

(2) Regulations that make provision under this paragraph for a trading period must set a limit on the total amount of the activities for the period.

(3) If the regulations also provide for the allocation of allowances for the period, they must—

(a) set a limit on the total amount of the allowances to be allocated for the period, and

(b) require each participant to acquire enough credits to offset any activities carried on by the participant in the period in excess of those for which the participant has or has acquired allowances.

(4) Otherwise, such regulations must—

(a) set a limit on the amount of the activities that each participant may carry on in the period, and

(b) require each participant to acquire enough credits to offset any activities carried on by the participant in the period in excess of that limit.

(5) The regulations must specify—

(a) the descriptions of credits that may be used for offsetting a participant's activities,

(b) the value of different descriptions of credit as regards the amount of the activities they are treated as offsetting, and

(c) the circumstances in which credits of any description may be used for the purposes of the trading scheme.

(6) The regulations—

(a) must contain provision for ensuring that credits used to offset activities under a trading scheme cannot be used by the participant for any other purpose;

(b) may enable credits to be cancelled by a person by whom they are held instead of being used for that purpose.