They said people would be able to engage with the scheme, which would see everybody given an annual carbon limit which they then 'spent' on items such as fuel and energy bills. Anyone who wanted to spend more than their limit would then be able to buy extra credits from low carbon emitters.

The Environmental Audit Committee said such a system of carbon trading "could be essential in helping to reduce our national carbon footprint". It would be more effective than green taxes at driving down emissions and would also promote behavioural change, the MPs said.

The committee admitted that there was likely to be strong public opposition to the idea but urged the Government to be "courageous", saying the need to reduce emissions was "simply too urgent".

It added: "Persuading the public depends on perceptions of the Government's own commitment to reducing emissions, and of the priority given to climate change in it's own decision making."

In a report entitled Personal Carbon Trading, the committee criticised the Government for it's decision to abandon the idea following a pre-feasibility study.

It concluded: "Personal carbon trading could be essential in helping to reduce our national carbon footprint. Further work is needed before personal carbon trading can be a viable policy option and this must be started urgently, and in earnest.

"In the meantime there is no barrier to the Government developing and deploying the policies that will not only prepare the ground for personal carbon trading, but will ensure its effectiveness and acceptance once implemented."

The group of 16 MPs heard evidence from a range of experts last July. It said that if the Government wanted to "stand the slightest chance of meeting its 2050 carbon emissions target" it could not afford to ignore the domestic and personal sector.

It argued that while there would be severe complexities in establishing the carbon credits system, the vast majority of these were not insurmountable.