EU Parliament reaches compromise over aviation ETS

On a plenary vote on 3 April 2014 the EU Parliament reached a compromise on the scope of the aviation ETS. The measures will apply only to intra-European flights in the ETS scope. Flights between European Economic Area (EEA) and Switzerland, EEA outermost regions, EEA overseas territories, as well as flights of small aircraft operators are also exempted. The EU-ETS will apply from 2013 to 2016, when an ICAO summit is expected to decide on a global scheme to reduce aviation CO2 emissions. Should ICAO fail to reach an agreement in 2016, the EU ETS will be applied in full scope. The relevant EU legislative procedures will be concluded on 14 April, when the EU Council is expected to formally adopt the new rules.

The compromise was hefty criticized by the EU Commission’s environmental committee and environmental groups, as well as by some MEPs. Apart from obvious environmental concerns, critics regretted that the EU bowed to external pressure from the US, Russia and especially China. The latter had even conditioned the order of new Airbus aircraft to the ETS scope and had suspended orders concerning such aircraft (see here and here).  

Moreover, the European Regions Airline Association (ERA) and the European Low Fare Airline Association (ELFAA) expressed their disappointment, because the new scheme undermines their members’ competitiveness. On the contrary, the compromise was welcomed by the Association of European Airlines (AEA), whose members are mainly legacy airlines conducting (exempted) long haul flights and the Airlines for America (A4A), a US airline pressure group that regards EU ETS as an internationally unlawful attempt to impose new taxes on US airlines.

To be fair, the EU Parliament had to strike a very difficult compromise. On the one hand, there was a tremendous pressure from third countries, which had threatened even with a trade war. On the other hand, the EU had to save face and not abandon the whole scheme. At the same time, caution was needed to avoid exaggerated impact on the EU airlines’ competitiveness against air carriers of third countries. Therefore, all long-haul flights were exempted, which satisfied third countries without placing EU carriers at a disproportionate disadvantage. The interests of EU regional carriers had to be sacrificed for the sake of the EU international dignity, although it is disputed whether the latter was achieved. As to environment, it appears that the EU is one of the fewest actors paying attention. The whole aviation ETS could be seen as an international gamble to include aviation in the global CO2 control emission efforts. To a small extent it worked out, given that ICAO agreed to initiate negotiations on the issue, but at a high cost for EU’s credibility and international power.

See more comments here and here. For an explanation of the new scope of the ETS click here.