The government has set out how it intends to introduce the Kyoto agreement on the reduction in carbon emissions from power generators and industries such as steel and cement.

Margaret Beckett, environment secretary, said: 'The EU Emissions Trading Scheme will be a vital measure in our drive to reduce emissions of greenhouse gases across Europe.

"We have set the overall number of allowances for UK industry at a level which moves us beyond our Kyoto Protocol commitment towards our tougher national goal and which recognises the need to preserve the competitive position of UK industry.

"The allocation of emission allowances has been set at a challenging but achievable level which will encourage industry to invest in emission abatement and take advantage of the opportunities that trading has to offer."

Forum Response: Chemical Industries Association

Judith Hackitt, director general of the Chemical Industries Association, said: "The choice of a two-stage process for the National Allocation Plan may be a good beginning, but the government must ensure that any benefits that it offers are not undone by tougher overall targets driving up input costs such as electricity.

"In addition, the UK government needs to be very sure that it has not adopted a stance that is out of step with other EU member states, thereby disadvantaging the UK chemical industry."

Forum Response: Institute of Directors

Geraint Day, environment policy adviser at the Institute of Directors, told ePolitix.com: "The government's targets are totally unrealistic. Industry experts already predict that a 10 per cent cut in CO2 emissions by 2010 was more probable. 20 per cent seems overly optimistic. Targets in any case can distort priorities."

Forum Response: Construction Products Association

Rita Singh, policy development executive at the Construction Products Association, told ePolitix.com: "The construction products industry is disappointed with DEFRA's proposal to set strict targets for industry that are over and above the requirements to meet the government's Kyoto commitment.

"The Emissions Trading Scheme is a European scheme and UK government should ensure that its targets do not over regulate UK industries which will be competing against other European companies.

"The European Environment Agency report, produced in the COP9 meeting in December 2003, showed that the UK was one of only two countries expected to meet its commitments by 2010 through actions already taken. We believe that doubling the target to emission reductions to 16.3% in Phase 1 wouldseverely damage the competitiveness of our industry, which is increasingly competing on a global scale.

"Industry is keen to improve its environmental credentials and has worked with government on numerous initiatives to reduce its burden on environmentand society. We now look to government to ensure that it does not 'gold plate' regulations emerging from EU that damage the industry's competitiveness."