Welsh Ministers have set the level of Wales’ fourth carbon budget in law, capping average net Welsh greenhouse gas emissions across 2031–2035 at 73% below the statutory baseline. The instrument was made on 3 December 2025 following Senedd approval on 2 December and comes into force on 5 December 2025.
Carbon budgets under Part 2 of the Environment (Wales) Act 2016 are legally binding five‑year caps on territorial emissions. Ministers are under a duty to ensure the net Welsh emissions account for each budgetary period does not exceed the level set in regulations, with compliance assessed against the aggregate for the period rather than a single year.
The 73% level mirrors advice published by the Climate Change Committee (CCC) on 14 May 2025 and is framed to remain consistent with Wales’ legislated pathway of a 63% reduction by 2030, an 89% reduction by 2040 and net zero by 2050. These milestones were previously set through 2021 regulations and remain the reference trajectory for planning.
Two companion instruments were progressed alongside the carbon‑budget regulations. Ministers confirmed a 0% credit limit for the 2026–2030 period-requiring Carbon Budget 3 to be met through domestic action-and updated the definition of a carbon unit to align with Article 6 of the Paris Agreement for any future use of international credits.
Technically, the CCC’s Balanced Pathway indicates delivery of Carbon Budget 4 will require maintaining recent rates of emissions reduction, with faster deployment of proven options. Priority signals include electrification of vehicles and heat and strengthened action across agriculture and land use-areas where many policy levers are devolved to Wales.
For public bodies and regulated sectors, the new budget sets a clear planning constraint for the early‑2030s. Investment cases, corporate plans and procurement frameworks in transport, housing retrofit, industrial decarbonisation and land management will be expected to demonstrate credible contributions to the multi‑year cap as funding rounds and statutory guidance are refreshed.
Timing matters. Carbon Budget 4 starts in 2031, but policy development continues during the current budgetary period. The Welsh Government has indicated it will publish its plan for meeting the 2026–2030 budget before the end of 2026, providing an early window for aligning programmes with the longer‑term constraint now set for 2031–2035.
Documentation for practitioners accompanies the change. The Regulations are issued with a Regulatory Impact Assessment available via gov.wales, and should be read alongside the credit‑limit and carbon‑accounting amendments and the CCC’s advice-where the Committee confirms its 73% recommendation includes Wales’ share of international aviation and shipping and advises against planning to rely on international credits for Carbon Budget 4.