Europe toughens stance on airline emissions

The European Commission is continuing on its collision course with the aviation industry after the Environment Committee this week called for plans to include airlines in the EU's Emissions Trading Scheme (ETS) to be pulled forward to 2010.

The Commission had originally planned to include flights within the EU in the scheme from 2011 with flights in and out of the EU included from 2012. However, the environment committee has called for all flights to be included in the scheme from 2010 as separate rules for different flights would lead distort competition between airlines.

"It is difficult to explain that a flight from the UK to Morocco is not covered by the scheme while a flight from the UK to the Canary Islands [would] be covered," commented the committee's rapporteur Peter Liese.

The Committee, which voted 50 votes to none in favour of the proposals, also called for much stricter emission reduction targets for airlines under the scheme.

The Commission had proposed assigning credits or allowances equivalent to 100 percent of airlines' average emissions between 2004 and 2006 – a move that would mean airlines would have to pay for extra credits if their emissions increased further. But, mindful of the failure of the first phase of the ETS when many industrial sites received more credits than they required leading to a collapse in the market for credits, the Committee called for allowances for airlines to be cut to 75 percent of current emissions.

Assigning emission allowances to cover just three quarters of current emissions would add significant costs to airlines and likely lead to increased ticket prices as carriers would be forced to buy in large numbers of credits to cover their current emission levels. However, the Commission hopes the mechanism would also provide a major financial incentive for airlines to invest in technologies and processes that allow them to cut emissions. Those that reduce their emissions to less than three quarters of current levels could even generate revenue from the scheme by selling on their excess credits.

However, the plans will face staunch opposition from many within the airline industry after the International Civil Aviation Organisation (ICAO) last week passed a resolution opposing plans to include foreign airlines in the scheme.

In a statement the UN-backed body said that while it recognised " market-based options are valuable tools for addressing aircraft emissions. A majority of the delegations felt, however, that States should not apply emissions trading systems to the airlines of other States except pursuant to mutual agreement".

ICAO director general Giovanni Bisgnani went further still, reportedly branding the EC's plans as "disappointing and irresponsible".

Several airlines such as easyJet have pledged tentative support for the scheme, but with US airlines already planning legal action against the EU over the plans and Ryanair boss Michael O'Leary vowing to boycott the scheme the ICAO's position all but confirms that the EC will face a major legal battle if it is to force flights into and out of the EU into the scheme.