Aviation may be included in emissions trading

The European Commission has approved proposals to include aviation in the emissions trading scheme which is expected to raise the fare of a return flight by up to €9.

The aim is to reduce the air travel's growing contribution to climate change.

The fare increase will result from the fact that aircraft operators will have to invest in more efficient planes or buy additional emission allowances beyond those allocated to them.

Aeroplanes are an important and increasing source of greenhouse gas emissions that are causing global warming. Although aviation's share of overall EU greenhouse gas emissions is still modest at about three per cent, its emissions are growing faster than any other sector and risk undermining progress achieved through emission cuts in other areas of the economy.

EU emissions from international flights grew by 73 per cent between 1990 and 2003. This increase could widen to 150 per cent by 2012 unless action is taken. Such growth would cancel out more than a quarter of the eight per cent reduction in total greenhouse gas emissions that the Kyoto protocol requires the EU-15 to achieve between 1990 and 2012.

The Commission is now proposing that aviation should also be included in its emissions reduction system, or the emissions trading scheme (ETS).

The ETS, which covers about 11,500 industrial installations, enables participating operators to reduce their carbon dioxide emissions in the most cost-effective way. Each operator receives a limited number of emission allowances, creating a permanent incentive for each to minimise emissions.

These allowances can be traded on the market, thus giving operators the flexibility to choose the cheapest way to control their emissions. Bringing civil aviation into the scheme would allow aircraft operators to benefit from this cost-effective approach, enabling them to trade emission allowances in an expanded market with industrial operators and other airlines as necessary.

The inclusion of the aviation sector in the ETS will come at a cost although this is likely to be modest. According to the Commission the associated costs will vary between €0 and €9 per return flight depending on the strictness of the cap on airlines' emissions chosen and on how the scheme is implemented.

The Commission said that in any event, including aviation in the EU emissions trading scheme will have a smaller impact on fares than if the same environmental improvement were to be achieved through other measures such as a fuel tax or an emissions charge.

Environment Commissioner Stavros Dimas said in a press conference that the boom in flying was bringing with it a rapid rise in greenhouse gas emissions.

"Extending emissions trading to the aviation sector will limit these emissions and ensure that aviation, like all other sectors, contribute to reducing the harmful greenhouse gases. Through emissions trading, airlines will be able to do so at the least possible costs."

The new scheme would involve all EU airlines and all flights to and from European airports, thus including also all non-EU airlines flying to Europe.

The Commission said that legislative proposals will be presented in the middle of next year with the intention of applying the scheme from 2008.