BA Predicts Higher Fares if Airlines Forced to Joine Carbon Trading

"By 2011 we will probably have to purchase in order of 20 to 30 per cent of the allowances we need," Andy Kershaw, British Airways' manager of environmental affairs.

However, green campaigners will be able to take the Government to court if the "carbon budgets" or long term targets are blatantly breached, as they will be legally binding.

Raising the prospect of Britain having to take significant measures to deal with global warming, Mr Miliband also proposed that the new legislation would require the Government to report at least every five years on the current and predicted impact of climate change.

Ministers would also have to outline what they are doing to adapt to higher temperatures, rising sea levels and stormier weather. Mr Miliband also signalled a growth in "citizens' energy" - with homeowners with wind turbines or other microgenerators pumping electricity back into the national grid.

What the draft climate change Bill proposes .

Five-yearly "carbon budgets" which would cap the level of harmful greenhouse gas emissions from Britain.

. Legally binding targets to cut CO2 emissions by between 26 and 32 per cent by 2020 and by 60 per cent by 2050.

. Five-yearly reports by the Government on what action it is taking to adapt the country to the impact of rising temperatures, higher seas and stormier weather.

. A committee on climate change to give ministers independent advice on how to achieve the Government's targets.

. New powers to bring more sectors of the economy into the European emissions trading scheme.

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