September 23, 2013 7:52 pm

Clash over EU airline emissions policy threatens global deal

Air France Boeing 777-228(ER) plane landing at London airport.©Alamy

The US and Brazil are digging in their heels over an EU push to have its contentious scheme to tackle airlines’ carbon pollution endorsed by a UN agency, in a clash that could thwart efforts to reach a global accord on the same issue.

Negotiators will gather in Montreal from Tuesday at the International Civil Aviation Organisation – the UN agency that sets global aviation standards – in a bid to approve plans for a global scheme to reduce airlines’ carbon emissions from 2020. The European Commission is pressing for the ICAO statement on this global regime to incorporate language that allows the EU’s regional scheme to continue operating until the end of this decade.

The stakes are high, with some officials warning there is a serious risk of a trade war if no agreement is reached at the triennial ICAO assembly, which runs from September 24 until October 4.

Last year, foreign as well as European airlines were required by EU law to buy carbon permits to cover their emissions in certain circumstances.

Amid concerns that these arrangements could trigger a trade war, Airbus, the European passenger jet maker, complained it was unable to conclude deals with Chinese airlines because of China’s objections to its carriers coming within the scope of the EU law.

The European Commission subsequently watered down the arrangements twice, the most recent move being last month, but it has not won over leading critics.

Brazil said the inclusion of foreign airlines in the EU emissions trading scheme was “an affront to the principles of international law”.

“Even though Brazil understands that every country or region has the right to develop market measures for the aviation sector within its jurisdiction, the extension of these measures to foreign aviation operators violates the basic principle of international law regarding state sovereignty,” said Moreira Franco, a Brazilian minister of state and head of the secretariat for civil aviation.

Analysts said India, another opponent of the EU’s inclusion of foreign airlines in its emissions trading scheme, was likely to resist any attempt to bind New Delhi to regional or global mechanisms to reduce carriers’ emissions.

India, like other developing countries, has taken the stance that international efforts to combat climate change must be based on the principle of “common but differentiated responsibilities” – the concept that industrialised countries must do more to control their emissions than emerging markets, which historically have contributed markedly less carbon pollution.

The US also signalled it had concerns, partly because the draft resolution that the ICAO assembly is being asked to approve would provide exemptions from regional schemes such as the EU one for smaller airlines – notably carriers based in African countries.

The US state department said: “Throughout this [ICAO] process, the US government and the US airline industry have strongly supported ICAO efforts to develop a global market-based measure to reduce greenhouse gas emissions. Until such a measure is agreed, countries and regions should refrain from regulating emissions beyond their own airspace.”

The EU brought aviation within the scope of its emissions trading scheme because of frustration at years of disagreement inside ICAO on how to tackle airlines’ pollution.

Under the EU’s original plans that took effect in January last year, foreign airlines had to account for their emissions on the full length of all flights landing at European airports – for example, from Beijing to London. However, last November the European Commission said it was suspending these arrangements for one year, to try and increase the chances of an agreement at the ICAO assembly.

Earlier this month, the commission made further concessions, saying only the portion of foreign airlines’ flights that took place over EU airspace would fall within the scope of the regional bloc’s emissions trading scheme.

Siim Kallas, the European transport commissioner and negotiator at the ICAO assembly, is expected to say in his speech on Tuesday that the EU has “moved a long way over recent months”, but insist its amended regional scheme should be allowed to function until the end of the decade.

“Until [2020], countries or groups of countries should – within certain parameters – be able to deploy national or regional market based measures,” he is due to say.

The draft resolution before the ICAO assembly asks the organisation’s council, its governing body, to finalise plans for a so-called global market based measure to tackle airlines’ emissions by 2016, which could be implemented by 2020.

This global measure should be an offset scheme, under which carriers counterbalance any increase in their emissions after 2020 by purchasing carbon permits generated from projects that reduce pollution elsewhere, according to the International Air Transport Association, the leading aviation industry body.

Tony Tyler, the Iata director-general, said there was a risk that if the ICAO assembly failed to reach an agreement on this global measure, the EU would seek to restore full application of its emissions trading scheme against foreign airlines, bringing the world back to the “brink of a trade war”.

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