Bloomberg News

EU Said to Plan Carbon-Market Aviation Adjustment in October (1)

September 02, 2013

The European Union plans to present a change to its emissions curbs on airlines in the first half of October that will take into account a decision later this month by the United Nations on whether to pursue global measures to cut pollution by the industry.

The European Commission, the EU’s regulatory arm, is considering limiting carbon-dioxide discharges by flights into and out of the 28-nation bloc only in European air space, according to two people with knowledge of the matter. The final proposal will depend on the outcome of the vote by the UN aviation agency, said the people, who asked not to be identified, citing policy.

The commission proposed in 2012 to temporarily defer the imposition of carbon curbs on flights into and out of the region to facilitate talks on a global deal to reduce pollution from the industry. Flights within Europe remain subject to the EU’s carbon-reduction requirements in the cap-and-trade system.

“If we get a global deal we’ll amend the law,” Isaac Valero-Ladron said. “Our focus is on getting an ambitious global deal.”

The EU decided in 2008 that entire flights to and from European airports should be included within the bloc’s emissions trading system, the world’s largest, starting in 2012 after airline emissions in the region doubled over two decades. The enlargement of the European cap-and-trade program triggered opposition from countries including the U.S., China and Russia, who said the UN’s International Civil Aviation Organization is the forum to decide about pollution curbs.

ICAO Council

The ICAO Council is due to discuss global emissions-curbing measures on Sept. 4 in Montreal before its tri-annual assembly decides on the issue on Sept. 26, according to the agenda of the gathering.

The agency’s Council, which includes 36 nations, may propose countries commit this month to working toward a market-based mechanism starting in 2020 and leave a decision on its design to the next assembly meeting in 2016, said Tim Johnson, director of the Aviation Environment Federation lobby. That’s a middle line that may garner majority support from moderate nations like the U.S. and Australia, as well as the more committed groups like the EU, he said.

“The text is expected to set rules that would allow nations to implement market measures before the introduction of a global market-based mechanism,” he said. “This may encourage the EU to amend the basis for the inclusion of aviation in its emissions market ahead of a global market in 2020.”

Greenhouse Gases

The EU cap-and-trade program is the cornerstone of the region’s plan to cut greenhouse gases that scientists blame for global warming. It imposes pollution limits on more than 11,000 manufacturers and power companies, leading to a cap in 2020 that will be 21 percent below 2005 discharges. Emitters have to submit one emission permit for every metric ton of CO2 they discharge or pay a fine of 100 euros per ton.

“If indeed the EU has made such a concession as reported today, we would be very curious to see what the U.S. and friends have offered in return,” said Bill Hemmings, sustainable aviation manager at the Transport & Environment lobby in Brussels. “We need a rock solid global deal that builds on the EU ETS, not trashes it.”

The annual limit for the aviation industry began at 97 percent of average discharges from 2004 to 2006 and will fall to 95 percent in 2013. Airlines that joined the ETS this year were given emission permits making up 85 percent of the industry cap for free and will have to buy the remaining 15 percent at auctions. They can also trade among themselves.

The freeze on imposing emissions curbs on flights into and out of Europe, also known as the stop-the-clock proposal, affected around two-thirds of flights, the EU said last year.

To contact the reporters on this story: Ewa Krukowska in Brussels at ekrukowska@bloomberg.net;

To contact the reporter on this story: Alessandro Vitelli in London at avitelli1@bloomberg.net.


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