ICAO agrees aviation emissions roadmap but EU ETS constrained

Late amendments to the draft resolution were proposed by a number of developing States led by Russia, China and India. Despite a compromise proposal by Europe, the developing States won an amendment requiring that inclusion of foreign aircraft operators in the EU ETS or any similar regional scheme should be mutually agreed between the relevant States. The EU had believed a reduced scope EU ETS to limit the international elements to just European airspace in exchange for progress towards a decision on a global market based mechanism would be appease ICAO member States.

A key assembly agenda item to define a roadmap for a global aviation emissions reduction scheme by 2020 was overshadowed by the events concerning the EU ETS.  Details of the mechanics of the ICAO scheme and the resolution of contentious issues have been deferred until the 39th assembly in 2016 for implementation by 2020.

However, at least one notable exception, John Hanlon, secretary general of the European Low Fares Airline Association (ELFAA) which represents leading airlines such as Ryanair, EasyJet, Norwegian and Whizz Air, said the EU should not change the ETS legislation because none of its conditions have been met by the ICAO resolution. “None of the EU red lines, spelt out unequivocally at the time of granting the ‘Stop the Clock’ derogation are met by the outcome of the General Assembly of ICAO,” he said.

The EU Parliament must now decide whether the ICAO resolution is acceptable or not, particularly as ICAO resolutions are not legally binding upon EU States. In 2008 the European Parliament voted for the inclusion of aviation in the EU ETS with a large majority of approximately 600 / 100. The EU Parliament may conclude that the ICAO’s decision is as an infringement of EU and Member State sovereignty and current laws, requiring the EU to respond accordingly.

German Christian Democrat politician Peter Liese, who steered the original law, said the resolution hinders the EU’s ability to apply its law to flights traveling over European airspace, which he termed “indispensable.”  “The European Parliament will not agree that until 2020 we only cover intra-European flights,” he said in a statement.  If the EU Parliament and the European Council do not agree on an amendment, the EU will be forced to restart the clock on its law, likely triggering fresh threats of a trade war among countries that oppose the measure.

The Parliament must now decide whether to delay beyond April 2014 the European Commission’s plan to demand carbon permits from all airlines flying into and out of Europe.
Should the ‘Stop the Clock’ derogation continue in its present form then little will change for EU domiciled aircraft operators as they will still be required to perform compliance obligations and surrender sufficient emissions allowances by 30 April 2014. In the meantime all operators are strongly recommended to comply with current EU regulations until notified by their competent authority or their EU ETS management company to take alternative action.

Should you require additional information or have any specific questions please do not hesitate to contact Avocet.

For additional articles on this matter see:

Point Carbon - http://www.pointcarbon.com/news/reutersnews/1.2622317
GreenAir Online - http://www.greenaironline.com/news.php?viewStory=1762
Financial Times - http://www.ft.com/cms/s/0/3196dd06-2d1a-11e3-8281-00144feab7de.html
BBC - http://www.bbc.co.uk/news/world-europe-24429721

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