Sir Keir Starmer wants to sign Britain up to a European Union net zero scheme in a move that risks ramping up energy bills for millions of cash-strapped families. The Prime Minister is poised to use a summit next month to align the UK and EU emissions trading schemes as part of a celebrated “reset” of relations with Brussels.

Opponents have warned it risks pushing up the cost of producing electricity from gas-fired power plants, the UK’s second-largest source of power, and burdening businesses and hard-pressed households with further rate rises. It is understood the UK will link its own carbon credits scheme to that used by the Brussels bloc to “strengthen ties with Europe“. But Tory MP Nick Timothy claimed linking the schemes could cost British households an extra £112 a year in more expensive goods and electricity from gas-fired plants.

He told The Telegraph

: “Analysis shows that we could be heading towards an extra £112 on the cost of living because of European alignment. So long as policy races ahead of technology, this means higher energy bills, fewer jobs and weaker growth.

“If the Government signs up for the EU’s cap and trade scheme, then we will lose control and allow carbon prices to hit eye-watering levels. This is going back on what was promised to voters during the election.”

Net zero means no longer adding to the total amount of greenhouse gases in the atmosphere. It is widely accepted that to achieve this is to slash greenhouse gas emissions, which include carbon dioxide, which is released when oil, gas and coal are burned in homes as well as factories and to power transport, and methane, which is produced through farming and landfills.

Legally binding targets state the UK must meet net zero by 2050.

Energy Secretary Ed Miliband claims accelerating to net zero offers huge opportunities for Britain with the transition being one the opportunities of the century.

But critics say the ​green obsession is eye-watering costly, unpredictable and could cause an economic shock.

Last year Labour government announced several new bills that are relevant to net zero including the Great British Energy Bill to set up a publicly owned clean power company to drive investment in renewable energy, the Crown Estate Bill to remove restrictions and allow for easier investment in public infrastructure, and the Sustainable Aviation Fuel Bill to support the production of green aircraft fuel.

The Government also announced it would pursue other policies that affect climate change mitigation and adaptation, including policies on home insulation, nature and biodiversity, land management, and the water sector.

Emissions trading schemes are used by the Government and EU to raise money for net zero projects. They force carbon-emitting companies to buy credits for every tonne of greenhouse gases that they emit.

Since Brexit, when the UK launched its own ETS, British carbon credits have been much lower than those in Europe.

Yet Labour ministers are poised to use the UK-EU summit on May 19 to link Britain’s scheme to Europe, meaning that companies here pay the same tax to emit carbon dioxide as their continental counterparts.

The move would allow British exporters to avoid carbon import taxes imposed by the EU, but could result in a 50% rise in the cost of credits.

In February Mr Timothy challenged the Government to guarantee the British carbon price would remain lower than Europe for the remainder of this parliament, saying “manufacturers are lining up to tell the Energy Secretary that it would destroy British industry”.

In response, Mr Miliband said: “He believes we should double down on fossil fuels as the answer to the problems facing the country, whereas we know that clean energy is the way forward.”

A Government spokesman said: “We do not recognise these figures. We are resetting our relationship with the EU to improve trade and investment and promote climate, energy, and economic security.”