Welsh Ministers have approved the Carbon Accounting (Wales) (Amendment) Regulations 2025, which come into force on 5 December 2025 under the affirmative procedure of the Environment (Wales) Act 2016. The instrument was laid and approved by Senedd Cymru, following advice from the Climate Change Committee as required by section 49 of the 2016 Act.
The Regulations amend the Carbon Accounting (Wales) Regulations 2018 by removing references to the Kyoto Protocol and inserting a definition of the Paris Agreement. They also replace regulation 3 so that, for Welsh carbon accounting purposes, Article 6.4 emissions reductions are the recognised “carbon units”.
From commencement, a carbon unit in Wales is defined as a credit issued under Article 6.4 of the Paris Agreement and related UNFCCC/Paris decisions, with each unit valued at one tonne of carbon dioxide equivalent. In short, Kyoto-era certified emission reductions (CERs) are no longer the reference unit in Welsh law.
This update aligns the statutory framework with the international shift from Kyoto mechanisms to the Paris Article 6.4 mechanism. It ensures that, if Ministers ever decide to use international credits within Welsh targets, those units would be drawn from the Paris system rather than legacy Kyoto instruments. The change updates definitions only; it does not, by itself, authorise the use of credits.
The Regulations sit within Part 2 of the Environment (Wales) Act 2016. Under section 33, the “net Welsh emissions account” equals total net Welsh territorial emissions, minus any carbon units credited and plus any carbon units debited in the period. The Act also requires regulations to prevent any credited unit from being used to offset emissions elsewhere, addressing double counting.
The 2050 duty remains unchanged: Ministers must ensure the net Welsh emissions account in 2050 is at least 100% lower than the 1990/1995 baseline-i.e., net zero. That obligation was set in law in March 2021 by amending section 29 of the 2016 Act.
Credit use is separately constrained. For Carbon Budget 2 (2021–2025), the credit limit in law is 0% of the budget. For Carbon Budget 3 (2026–2030), Ministers have laid regulations to set the limit following October’s written statement; the Climate Change Committee has advised that the cap should again be 0%. Until any change is approved, the practical headroom from international credits remains tightly restricted.
In operational terms, the immediate effect is definitional. Public bodies and analysts using the net Welsh emissions account should note that any future purchase or cancellation of international units for Welsh accounting would need to be Paris Article 6.4 units rather than Kyoto CERs. Legacy CERs would not qualify for crediting to the Welsh account under the amended 2018 Regulations.
The change forms part of a wider package laid in October 2025 alongside regulations for Carbon Budget 4 and the new credit-limit regulations. The Welsh Government has prepared a Regulatory Impact Assessment and confirmed the update modernises carbon accounting while maintaining transparency. Huw Irranca-Davies MS, Deputy First Minister and Cabinet Secretary for Climate Change and Rural Affairs, set out the policy rationale in the written statement to the Senedd.