Will the emissions trading scheme take to the skies?

Aviation accounts for roughly 3% of Europe’s annual contribution to global warming, but a much bigger share of the political heat about climate change.

Although the sector’s contribution to greenhouse gases is smaller than other forms of transport, it raises green hackles for two reasons. First, aviation’s environmental impact goes well beyond carbon emissions. Planes emit nitrogen oxides and leave condensation trails and cirrus clouds in their wake. Estimates put the total impact on the environment at between 5% and 12% of total human activity on the environment. Second, the industry has experienced rapid growth, around 90% since 1990. And passenger numbers look set to keep on rising.

The response to last week’s deal on ‘open skies’, a plan to open the market in transatlantic flights, underlines how aviation growth divides people. Most business groups welcomed the deal, which points the way to cheaper flights and more opportunities for carriers. But green groups think there will be an environmental cost. The European Federation for Transport and Environment (T&E), a conservation group, estimates that the increase in traffic will offset emissions reductions made under the emissions trading scheme. Jos Dings, T&E’s director, criticised the deal for "giving away air space, without clawing back environmental control". T&E is also unhappy that taxation of fuel, although no longer illegal, will be subject to an arbitration process, which makes for an uncertain result. A spokesman for the Association for European Airlines said he did not expect the North Atlantic market to boom as a result of the deal. He added that growth would not affect the industry’s emissions containment policies.

A proposal to include aviation in the EU’s emissions trading scheme was announced by the European Commission at the end of last year. The plan is to bring internal EU flights into the scheme by 2011, with an extension to flights in and out of the EU by 2012. Airlines would be issued with emissions allowances, which they would then be able to trade with other airlines or with different industries. (Currently, the emissions trading scheme covers carbon emissions from power stations and steel, cement, paper and oil refining companies.) WWF, the environment group has criticised the decision to give away allowances, rather than auction them, arguing that it is a windfall profit for business. Business groups have worries about competitiveness, although they have cautiously welcomed the inclusion of aviation.

Questions have also been asked about whether an open trading scheme will be able to cope with a such a fast-growing polluter. Green MEPs wanted a separate, closed trading scheme, because of fears that aviation could overstretch the existing system. They worry that if airlines have limited opportunities to reduce carbon, they could buy a lot of allowances and push the price of carbon up to a politically unsustainable level.

It looks as if aviation will continue to raise the political temperature over the next decade.

Aviation accounts for roughly 3% of Europe’s annual contribution to global warming, but a much bigger share of the political heat about climate change.