Congress to pass bill opposing EU aircraft emissions rules

The US Congress is expected to pass a bill in the coming weeks expressing its formal opposition to a new EU law requiring commercial airlines to buy carbon permits for every tonne of CO2 they emit flying in and out of the bloc's airports.

Although the bill is considered less inflammatory than previously tabled proposals banning US airlines from complying with the regulation, it will no doubt stoke tensions between Brussels and Washington.

The EU incensed the US and many other countries, including China, India and Russia, by including all airlines servicing Europe in its emissions trading system (EU ETS) from 1 January. US airlines sought to have the legislation declared illegal on the basis that it infringes international aviation treaties, but this was dismissed by the European Court of Justice in December.

However, the US is known to be considering retaliatory measures, while the trade body for China's main airlines has said it will refuse to cooperate with the law, a stance that could risk fines or even aircraft being grounded.

Airlines are concerned emissions trading amounts to an extra financial burden of €10bn (£8bn) by 2020 at a time when fuel prices and other costs are rising and passenger numbers are declining. Several carriers have already raised ticket prices to cover the additional cost.

The industry would prefer a global solution to reducing aviation emissions, which currently contribute about three per cent of the global total, but are expected to increase significantly if no action is taken.

But the EU argues that sluggish progress of international talks necessitates action, and estimates emissions trading will save 183 million tonnes of CO2 each year by 2020. Climate commissioner Connie Hedegaard has also repeatedly pointed out that airlines will receive 85 per cent of the permits they need for free in the initial phase of the scheme and such windfall profits could be invested in more efficient aircraft and greener fuels.

An EU delegation is set to meet US officials this week to discuss the latest developments and ward off the potential of retaliatory measures.

Ahead of the talks, however, US transportation secretary Ray LaHood further enflamed tensions by calling the EU law a "very bad scheme" for airlines. He added that "I've told my [European] colleagues that Congress is very upset".