Jet fuel rationing becomes a reality
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Jet fuel rationing becomes a reality
Except they don’t call it fuel rationing, they call it ‘emissions trading’.
The European Parliament voted an hour ago to introduce an Emissions Trading Scheme for aviation from 2012, covering all airlines, EU and non-EU, except the very smallest. CO2 emissions will be capped at 97% of where they were in 2004-6, or about 10% lower than they are now. That cap is on a sliding scale – downwards.
In other words, air transport in Europe is going to have to shrink, either that or airlines will have to buy unused permits from other sectors if they want to continue to develop their business.
The real killer though is that airlines will not be given an initial allocation, they will have to buy them, or at least 15% of them to start with (possibly rising every year), from the taxman.
Industry calculations give a cost for the scheme averaging €5.3bn a year for the period 2012-2022, which is just a bit more than the entire sector made as profit in its best-ever year. 2008-9-10 will not be the industry’s best-ever year.
Before anybody starts shouting about ‘Brussels…’ this is elected MEPs (if you didn’t elect them, you could have) voting on a deal they agreed with 27 sovereign national governments.
My guess is that it will achieve its goal of shrinking European aviation, but not in an orderly, gradual way. Instead there will be bankruptcies among the weakened survivors of the current economic crisis, and voluntary liquidations when the recipients of the permits realise they are worth more traded than used to operate unprofitable routes. A lot of airports will drop off the air transport map and local economies will suffer. A lot of people, not just in the airlines, will be looking for jobs.
I’m hoping to be around this industry until 2014. If that’s the case, I’ll have a ringside seat for the spectacle. It won’t be a pretty sight.
The European Parliament voted an hour ago to introduce an Emissions Trading Scheme for aviation from 2012, covering all airlines, EU and non-EU, except the very smallest. CO2 emissions will be capped at 97% of where they were in 2004-6, or about 10% lower than they are now. That cap is on a sliding scale – downwards.
In other words, air transport in Europe is going to have to shrink, either that or airlines will have to buy unused permits from other sectors if they want to continue to develop their business.
The real killer though is that airlines will not be given an initial allocation, they will have to buy them, or at least 15% of them to start with (possibly rising every year), from the taxman.
Industry calculations give a cost for the scheme averaging €5.3bn a year for the period 2012-2022, which is just a bit more than the entire sector made as profit in its best-ever year. 2008-9-10 will not be the industry’s best-ever year.
Before anybody starts shouting about ‘Brussels…’ this is elected MEPs (if you didn’t elect them, you could have) voting on a deal they agreed with 27 sovereign national governments.
My guess is that it will achieve its goal of shrinking European aviation, but not in an orderly, gradual way. Instead there will be bankruptcies among the weakened survivors of the current economic crisis, and voluntary liquidations when the recipients of the permits realise they are worth more traded than used to operate unprofitable routes. A lot of airports will drop off the air transport map and local economies will suffer. A lot of people, not just in the airlines, will be looking for jobs.
I’m hoping to be around this industry until 2014. If that’s the case, I’ll have a ringside seat for the spectacle. It won’t be a pretty sight.
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This has been on the cards for a considerable time, so is hardly coming as a shock.
Indeed correct me if I am wrong didn't some airlines (something rings a bell about easyjet) say they had no problems or were in favour of the deal - probably just trying to pretend to have green credentials maybe?
Indeed correct me if I am wrong didn't some airlines (something rings a bell about easyjet) say they had no problems or were in favour of the deal - probably just trying to pretend to have green credentials maybe?
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I don't have any figures to hand, but I suspect that a lot of older aircraft will be phased out over the next few years due to the cost of running them, and as a result emissions will decrease anyway as newer aircraft fill the gap. That would explain why EZY are happy with it - they have the newer aircraft already, whilst competitors such as Alitalia for example will have to look at replacing their MD80s with cleaner aircraft.
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I can't see how they are going to administer this. Will it be on a per flight basis? Will we see stop-overs just outside the EU to "shorten" the flight for CO2 trading purposes? If it was just on miles flown within the EU we might see some strange routings.
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How does this work? You pay your money to the government. It is not tax though. Oh no.. But what happens to the money? They don't have a magic store of "environment regeneration" to buy with the money.
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Correct me if I'm wrong:
The most effective way for EU to reduce fuel burn/carbon footprint is through ATC modernization and allied efficiencies. If they are serious about the problem, they'll attack the true culprit, rather than hitting on the clients.
The most effective way for EU to reduce fuel burn/carbon footprint is through ATC modernization and allied efficiencies. If they are serious about the problem, they'll attack the true culprit, rather than hitting on the clients.
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eu carbon savings
It would help enormously if the EU Parliament ceased to shuttle between Brussels and Strasbourg frequently.It would not only save a lot of emissions but also a lot of money.Perhaps the UK fiscal contribution to the EU could then be reduced.But then the French would lose face so it won,t happen 
Correct me if I'm wrong:
The most effective way for EU to reduce fuel burn/carbon footprint is through ATC modernization and allied efficiencies. If they are serious about the problem, they'll attack the true culprit, rather than hitting on the clients.
The most effective way for EU to reduce fuel burn/carbon footprint is through ATC modernization and allied efficiencies. If they are serious about the problem, they'll attack the true culprit, rather than hitting on the clients.
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Before anybody starts shouting about ‘Brussels…’ this is elected MEPs (if you didn’t elect them, you could have) voting on a deal they agreed with 27 sovereign national governments.
Still, something had to happen on aviation emissions. The car lobby is so much more effective.
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Cwatters:
The permits will apply to the flight through to its destination. The big issue is so-called ‘carbon leakage’ which will benefit eg the Gulf carriers who will fly passengers on routes like Frankfurt-Dubai-China but require permits for the Frankfurt-Dubai sector, despite the fact that the carbon footprint will be greater than a Frankfurt-China non-stop. Or, a routing NYC-Dubai-India would bypass the European scheme but a NYC-Frankfurt-India would be subject in its entirety.
Pwalhx & Curious Pax:
Airlines with ultra-efficient fleets have nothing to trade up to, they are already emitting less so they will receive fewer permits.
Barit1:
You got it in one
The permits will apply to the flight through to its destination. The big issue is so-called ‘carbon leakage’ which will benefit eg the Gulf carriers who will fly passengers on routes like Frankfurt-Dubai-China but require permits for the Frankfurt-Dubai sector, despite the fact that the carbon footprint will be greater than a Frankfurt-China non-stop. Or, a routing NYC-Dubai-India would bypass the European scheme but a NYC-Frankfurt-India would be subject in its entirety.
Pwalhx & Curious Pax:
Airlines with ultra-efficient fleets have nothing to trade up to, they are already emitting less so they will receive fewer permits.
Barit1:
You got it in one
At the end of the day it is just a tax and like all taxes there will be ways to dodge it, particularly if you stay outside the EU. Sounds like Kyoto airborne version.
Really hard to believe that anyone thinks this is going to help reduce anything but the market share of EU airlines.
20driver
Really hard to believe that anyone thinks this is going to help reduce anything but the market share of EU airlines.
20driver
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Not sure what is happening in Europe these days, we seem to be very busy trying to commit financial suicide, just so that someone somewhere can make a quick buck. I think we will hit a point pretty soon where there is nothing left to take.
A strong air transport system is an essential part of the infrastructure of a successful nation. If we can't provide it ourselves, someone else will.
A strong air transport system is an essential part of the infrastructure of a successful nation. If we can't provide it ourselves, someone else will.
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as has been said, its just a tax.
sorting out the ATC situation would generate real fuel savings, not fake paper ones. In fact, due to rerouting and all sorts of stuff, this is likely to increas fuel burn as all the long haul flights will probably include a stop 1 mile outside the EU. (Perhaps the isle of man or channel islands should build and international airport!)
however my guess is that either the scheme will have little or no effect, or that it will never happen as the EU have no authority over non-EU carriers.
sorting out the ATC situation would generate real fuel savings, not fake paper ones. In fact, due to rerouting and all sorts of stuff, this is likely to increas fuel burn as all the long haul flights will probably include a stop 1 mile outside the EU. (Perhaps the isle of man or channel islands should build and international airport!)
however my guess is that either the scheme will have little or no effect, or that it will never happen as the EU have no authority over non-EU carriers.
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European union it´s an utophy. If I pay an euro on Taxes I want it to be spent in somethig that reduces carbon emissions, trees? with all the money they will get you may plant the whole europe land in one month!!!! It´s just another way to get the money from the botton.
Any state (country) it´s just the consecuence of a good administered Mafia.
Any state (country) it´s just the consecuence of a good administered Mafia.
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emissions trading has been on the cards for years and years. So aviation comes in as a part of phase 2 of the scheme. All large industries will eventually be a part of it. The aim is to cap carbon emissions at x number of million tonnes in europe every year. Industries that can clean up can sell their permits to industries that can't. It's not just a tax on aviation it's an attempt to do something about carbon emissions in all industries in Europe.
BA have been a part of the UK-ETS for a few years. It's an attempt to meet the kyoto targets. Whether it's the answer to carbon emissions i don't know, but it's a start.
BA have been a part of the UK-ETS for a few years. It's an attempt to meet the kyoto targets. Whether it's the answer to carbon emissions i don't know, but it's a start.
short flights long nights
Did'nt the crazy Dutch just whack on some sort of "green" tax for flights ex SPL..I seem to remember reading 45 euros a person to help save the planet. Problem as I see it, 10 mins after takeoff you are outside the Netherlands any way...so all it is, is another rip off tax. Why dont they just take all the money from everyone in Europe and issue food stamps instead?