The European Union’s Emissions Trading Scheme (EU ETS) essentially got a green light last week to proceed with its plans to include domestic and international aviation in Phase III of the program starting in 2012. The meeting of the International Civil Aviation Organization (ICAO), a UN affiliated agency, reached a global agreement last week between the 190 member-nations to move forward with fuel efficiency measures and emissions caps on the sector beginning in 2020. This first sector-specific agreement by a UN agency to reduce emissions will cover roughly 90% of worldwide air traffic.
“The headline outcomes from the ICAO meeting were the setting of a global target of 2 per cent fuel efficiency improvements per year up to 2050, peaking growth in greenhouse emissions by 2020, a global framework for the development and deployment of sustainable alternative aviation fuels, and a target of 2013 for a CO2standard for aircraft engines,” reports Carbon Positive News. By setting forth their intention to utilize market-based mechanisms (MBMs) to reduce emissions, ICAO effectively granted the EU the right to move forward with their own initiative to start charging airlines for permits to emit a ton of carbon dioxide into the atmosphere under their already established cap and trade program.
The EU ETS is the world’s largest carbon market and the blocks main tool for combating climate change. By setting a limit on the amount of carbon dioxide that can be put into the atmosphere by covered entities, the ETS requires that allowances be purchased for each ton of carbon dioxide a facility emits. During its first two phases running from 2005-2012, the EU ETS has targeted about 12,000 energy generating facilities and heavy industries players to ratchet down the output of emissions from the 27-nation block towards its goal of 20% reductions below 1990 levels. With the third phase set to get underway within the next couple of years, the EU is looking to step up its efforts by including the aviation industry that currently contributes about 2% of the world’s emissions.
With the EU looking to cap emissions for both domestic and international flights, this has caused uproar by American-based airlines that refuse to be subjected to foreign regulation of greenhouse gases. The Air Transport Association of America (ATA) has already announced plans to sue the EU for their efforts to cover international aviation emissions under the ETS. As reported by Point Carbon North America, the American lobby is fighting on behalf of its members that include American Airlines, Continental Airlines, and United Airlines.