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Brussels to force EU airlines to join carbon emissions scheme

By Stephen Castle, in Brussels
Tuesday, 27 September 2005

Controversial moves to add airlines to the EU's emissions trading scheme will be approved by the European Commission today in a move designed to force the aviation sector and its customers to pay more for the pollution that is generated.

The plan, put forward by the EU environment commissioner Stavros Dimas, follows months of debate over how best to make the airline industry more sensitive to mounting environmental concerns about carbon dioxide emissions.

Under the Dimas plan, which is expected to be rubber-stamped by the Commission, an emissions-trading scheme would be used instead of alternative ideas being canvassed, including the introduction of fuel tax or a levy on individual tickets.

The Commission says its impact study estimates that the measure would add no more than €9 (£6) to the cost of a return ticket. It argues that emissions trading would provide a big incentive to airlines to invest in green technology and use airspace as effectively as possible, cutting down on the amount of fuel used in avoidable detours on journeys.

The Commission wants to apply the scheme to all airlines flying from the EU, something which would force foreign operators to sign up as a condition for flying from the EU. Some believe opposition to the idea will be so strong from the US that the EU will have to fall back on a less ambitious scheme restricted to intra-European flights, currently restricted to airlines based within the bloc.

In any event, the EU is due to revise its current emissions trading directive next year, and the Commission wants to amend the legislation to include the aviation sector. The measure will have to be agreed by the European Parliament and EU member states.

Companies would be set targets and, if exceeded, would have to buy permits from other polluters - though not necessarily from the aviation sector.

The Commission has yet to finalise the details but plans to deal directly with airlines rather than make them part of the national schemes administered by EU member states. One official said: "We found that emissions trading was the most cost-effective, environmentally friendly scheme and it is supported by industry." The UK, which holds the EU presidency, backs the scheme and is likely to allocate time for member states to discuss it from its work schedule.

The measure is also expected to win the backing of British Airways which, alone among the country's operators, is part of the UK's emissions-trading scheme.

A BA spokesman said: "We believe that emissions trading is the most effective way of limiting CO2 emissions and reducing global warming, and hope aviation will be included in the EU trading scheme from 2008. Only emissions-trading schemes provide a financial incentive for companies to improve their environmental performance."

He added: "Increasing taxes on aviation is a blunt way of placing additional costs on the industry without providing any environmental improvement. We are the only airline that has joined the current UK emissions-trading scheme."

The view is shared by a number of airlines which accept that their current exemption from tax on aviation fuel is not tenable in the long term. Many operators are alarmed at plans to slap a levy on tickets to generate funds for areas not related to aviation, such as development aid. Moreover some airlines see an advantage in the fact that it will take at least two or three years to get the measure through the EU legislative procedure.

Meanwhile, operators will say that if they invest in greener technology including more fuel-efficient jets, they should be provided with better infrastructure from which to operate.

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