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Press Release No.: 37

Date: 8 July 2008

European ETS Vote: The Wrong Answer

Geneva - The International Air Transport Association (IATA) severely criticised today’s European Parliament vote to bring aviation into the European Emissions Trading Scheme (ETS).

“It’s absolutely the wrong answer to the very serious issue of environment,” said Giovanni Bisignani, IATA’s Director General and CEO. “We support emissions trading, but not this decision. Europe has taken the wrong approach, with the wrong conditions at the wrong time.”

The Wrong Approach: Europe’s unilateral and extra-territorial approach will apply ETS to all aircraft flying to or from Europe. Without international agreement this will only spark international legal battles. “What right does Europe have to impose ETS charges on, for example, an Australian carrier flying from Asia to Europe for emissions over the Middle East? Article 1 of the Chicago Convention prohibits this. And it goes against Article 2 of the Kyoto Protocol. Fuelling legal battles and trade wars is no way to help the environment. Already over 130 states have vowed to oppose it. The only successful way forward for ETS is as the drafters of Kyoto envisaged and the G8 leaders - including Europe - today confirmed. That’s a global scheme brokered through the International Civil Aviation Organization (ICAO),” said Bisignani.

The Wrong Conditions: In its first year of operation, the ETS will add EUR3.5 billion to industry costs and this will rise year-on-year. There is no guarantee that any of the funds generated will be earmarked for environmental purposes. Today’s decision only indicates that revenues generated from the auctioning of allowances “should” be used to reduce greenhouse gas emissions.  “It’s the weakest possible language. The plain fact is that the only sure beneficiaries of the EUR 3.5 billion cost will be national government coffers. There is no assurance that any of the money will go to environmental programmes. It’s time for Europe’s politicians to be honest. This is a punitive tax put in place by politicians who want to paint themselves green. Worse, it’s not even part of a coordinated European policy. This tax will come on top of the UK’s Air Passenger Duty and the Dutch Air Passenger Tax. Rather than double or triple charging for emissions, governments should focus on solutions to improve environmental performance,” said Bisignani.

The Wrong Time: With oil trading above US$140 a barrel and jet fuel above US$170 per barrel, the industry fuel bill for 2008 will be at least US$190 billion. “Airlines are struggling to reduce fuel burn to survive. Adding an extra EUR 3.5 billion to industry costs will not produce any better results. If Europe is serious about environment, it would move forward quickly with the Single European Sky proposal. By the Commission’s own calculation, this would save up to 16 million tonnes of CO2, reduce delays and improve environmental performance,” said Bisignani.

Airlines are committed to effective measures to reduce the 2% of carbon emissions attributed to aviation. “Reducing fuel burn to improve environmental performance is a top priority. IATA’s four-pillar strategy to address climate change is now an industry commitment that does just that. Emissions trading is one small part of a comprehensive strategy that includes investing in technology, improving operations, building efficient infrastructure and using positive economic measures,” said Bisignani.

“Our focus is on results. Last year the strategy saved at least 10.5 million tonnes of CO2. Our target is a 25% improvement in fuel efficiency by 2020. And we are working towards carbon-neutral growth with a vision for a carbon-free future. Europe’s tunnel-vision focus on a unilateral, punitive and illegal ETS may help some government budgets, but it will do little if anything to improve environmental performance. It’s time for Europe to re-focus,” said Bisignani.

Notes for Editors:

  • IATA (International Air Transport Association) represents some 230 airlines comprising 93% of international scheduled air traffic. 

 

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