Commission to call for green levy on flying

Date: 18/11/1999

By Gareth Harding

THE European Commission will next week unveil a raft of radical measures to combat the environmental damage caused by aeroplanes which aims to cut aircraft noise and emissions but could lead to an increase in the cost of flying.

The Commission's long-delayed policy paper on air transport and the environment will recommend introducing a broad-based 'green' levy on either tickets, airports or an emissions charge based on the number of kilometres flown by airlines.

However, it rejects calls for an aviation fuel tax as legally dubious, economically harmful and of limited benefit to the environment.

At present, kerosene is exempt from minimum duties which are slapped on other fuels. A Commission-sponsored study, which will also be released next Wednesday (24 November), estimates that this waiver deprives the EU coffers of €11 billion a year.

Transport Commissioner Loyola de Palacio's proposals reflect the institution's growing concern about the environmental impact of rampant air traffic growth. Although planes are responsible for only

2-3% of total carbon dioxide emissions, increases in passenger traffic threaten to blow a hole in the climate change goals which the EU signed up to in Kyoto. Since 1980, the number of travellers has risen by more than 120% and most experts predict that this figure will continue to increase by 10% a year.

The move also highlights the Commission's frustration at the International Civil Aviation Organisation's (ICAO) foot-dragging on environmental issues. The world-wide body has traditionally taken a lowest-common-denominator approach to curbing aircraft emissions, which has frequently led to public clashes with the Union.

The Commission's draft paper states that "this global framework now falls short of addressing the environmental needs of the world's most densely-populated regions such as the EU".

In particular, De Palacio is concerned that the ICAO's noise standards have "fallen significantly behind" what is required to tackle "pressing environment needs in the Union".

The report warns that if the international body fails to adopt more stringent noise standards in 2001, the Commission will propose its own harsher limits. This would not only infuriate the ICAO, but almost certainly lead to further clashes with the US, which is still pressing the Union to abandon its plans for a ban on aircraft fitted with hush kits to reduce noise.

De Palacio's proposals are certain to be highly controversial with both industry and some member states. But analysts say that by opting for an environmental charge rather than a tax, the proposal stands a better chance of being adopted by EU governments than the ill-fated energy tax - which is currently being blocked by Spain - because it could be agreed by qualified majority vote.

Europe's carriers are steadfastly opposed to many of the changes suggested by the Commission. A spokesman for the Association of European Airlines said any charge or tax on flying would be counterproductive, as it would hit airlines "in their pockets" without delivering significant environmental benefits.

The industry is, however, prepared to sign a voluntary agreement to improve fuel efficiency similar to the deal struck between the EU and car-makers earlier this year.

The Commission's draft paper favours this approach as long as any future accord goes further than energy-efficiency improvements based on current technology.

Environmental groups have, however, welcomed De Palacio's proposals. "The yearly €11-billion tax exemption over-stimulates the growth of aviation far beyond ecologically sustainable levels," said Ton Sledens of the European Federation for Transport and the Environment.

He added that if the sector paid the normal charge on fuel, the tax burden on the average household could be cut by €120 a year, while adding only €10 to the cost to passengers of a 1,500 kilometre flight.

The European Commission is to unveil a raft of radical measures to combat the environmental damage caused by aeroplanes which aims to cut aircraft noise and emissions but could lead to an increase in the cost of flying. The long-delayed policy paper on air transport and the environment will recommend introducing a broad-based 'green' levy on either tickets, airports or an emissions charge based on the number of kilometres flown by airlines.