The UK has put forward its own Emissions Trading System (ETS) to replace the European Union’s system for trading carbon emissions, which the country will leave at the end of this year as the Brexit transition period ends.

The UK-wide ETS, which will put a cost on carbon pollution to encourage companies to reduce the greenhouse gases they emit, includes plans to cut the emissions cap by 5%, the government said.

The ETS is part of Britain’s plan to reach a net zero carbon emissions target by 2050.