License to Grow
By Tony Tyler, IATA's Director General and CEO
The European Commission (EC) “stopped the clock” for the inclusion of international aviation in its Emissions Trading Scheme (EU ETS). That’s good news. Europe deserves credit for raising climate change on the international air transport agenda. But the extra territorial approach of the EU ETS had focused non EU states’ attention on blocking Europe’s encroachment on their sovereignty rather than on reducing emissions.
Now, the space has been created for the International Civil Aviation Organization (ICAO) to bring states to a political agreement on a global approach for market-based measures (MBMs) to help manage emissions. ICAO has already made significant progress on narrowing the technical options for MBMs. And everyone is gearing up for an agreement at the ICAO Assembly in 2013.
This is putting pressure on airlines. Through ICAO, governments will agree on a mechanism for MBMs. But airlines must be ready with ideas on implementation. Finding a fair balance will be a challenge. Some airlines have already invested in fuel-efficient fleets; others are in the process of upgrading. Airlines in mature markets face very different future prospects from those growing rapidly in the developing parts of our industry.
A compromise will be needed. No solution will satisfy every airline 100%. But not achieving a solution will most certainly be unsatisfactory for all.
If we leave it to governments to decide how MBMs should be implemented without aviation’s input the risks are high. Lacking the detailed operational knowledge airlines can provide, we could get an outcome that is unworkable, competition-distorting or unnecessarily cumbersome. And if airlines are not united, governments could pick us apart and enforce implementation measures that potentially could do more to improve their financial situation than our environmental performance.
I am optimistic. Aviation’s license to grow is predicated on sustainability. With that understanding, the entire industry agreed to improve fuel efficiency by 1.5% annually to 2020; to cap emissions from 2020 with carbon-neutral growth; and to cut net emissions in half by 2050 when compared with 2005 levels. We remain the only industry with such ambitious global targets. And we are united in our commitment to deliver.
In the meantime, we must also be vigilant in reminding governments that their role in tackling climate change goes beyond setting MBMs. Government commitment is critical in many areas—sorting out air traffic management, building more efficient infrastructure and setting the right fiscal frameworks for the development of biofuels to name but a few. In the long term these will most certainly play a more significant role than MBMs in ensuring aviation’s sustainability. Aviation supports some 57 million jobs and $2.2 trillion in economic activity, connects 3 billion people, and delivers 35% of goods traded internationally by value annually. Ensuring the industry’s sustainability and license to grow is an essential priority for governments and the global economy.