Sectoral approach for international aviation emissions hits headwind in Cancun as spectre of climate financing looms
Mon 13 Dec 2010 – Despite the cheering news of late compromise and modest achievement at the COP 16 climate change summit in Cancun, no progress was forthcoming over bunker fuel negotiations on limiting international aviation and shipping emissions. The issue of ‘common but differentiated responsibilities’ (CBDR), which underpins the current Kyoto climate agreement, again reared its head as a major obstacle in ambitions to have the aviation and maritime industries treated as separate sectors under the UNFCCC framework. The wider Cancun agreement reached on Saturday includes the setting up of a Green Climate Fund that will aim to raise $100 billion a year by 2020 to help developing countries mitigate climate change impacts. With most of the funding expected to come from private rather than public finance, ICAO and the aviation industry may well have to marshal forces as attention turns in 2011 to identifying possible sources, with aviation already suggested as a potential easy earner.
The only document concerning aviation to be released during the two-week summit was an acknowledgement by the Subsidiary Body for Scientific and Technological Advice (SBSTA), which provides information and expert assessments to the main COP (Conference of the Parties) body, of the ongoing work of the International Civil Aviation Organization (ICAO) and “inviting” it to continue reporting at future SBSTA sessions. As this happens every year, there is little cause for encouragement here.
However, its presentation to SBSTA did allow ICAO to present the achievement made in securing a milestone resolution at the ICAO Assembly in October. According to Paul Steele, Executive Director of the cross-industry Air Transport Action Group (ATAG): “At COP 16, the work of the industry has clearly been acknowledged but, also importantly, the recent resolution on aviation and climate change has now put ICAO clearly in the driving seat in terms of addressing emissions.”
The lack of reference to aviation in the final COP 16 text means that ICAO can continue to move forward and build on the progress achieved at the Assembly, said ATAG.
The bunker fuel negotiations held by a sub-group of the Ad Hoc Working Group on Long-term Cooperative Action (AWG-LCA) became an exercise in futility as debate focused on process rather than content, with text mired in square brackets. According to ATAG, much attention was paid to the issue of CBDR and much debate as to where the reference to the ‘provisions of the convention’, i.e. CBDR, should be.
“A number of Parties attempted to input different formulations of text in order to move the process on, but it was very clear that there remains a deep divide between those parties who insist on CBDR being in the bunker fuel discussion and those who insist on it not being in there,” said a spokesman for ATAG.
Despite informal discussions, a meeting held under the authority of the chair of the AWG-LCA, who pushed the Parties hard, failed to agree even on the framework paragraph for the relevant section. Until the CBDR issue can be resolved, if at all, there is little likelihood of progress for the time being and negotiations on bunker fuels will have to start again next year, with three sessions scheduled during 2011 before COP 17, which is due to take place in Durban, South Africa from 28 November to 9 December. COP 17 is the last summit before the end of the Kyoto commitment period in 2012.
“Given the slow pace of progress made in COP 16, it is unfortunate that the very real work of reducing emissions is being overtaken by embroiled political process,” said ATAG’s Steele. “We are however confident in our industry’s ability to meet the challenge we have set ourselves and will continue to push forward to deliver our share of the effort.
“We will continue to work actively through ICAO and encourage governments to respect our targets and take the steps that they need to ensure the industry is able to meet the emissions challenge.”
The industry sent a large delegation to Cancun for the summit to monitor progress and deliver its message to negotiators and participants. It held a number of side events to promote work being done on biofuels, technology, infrastructure and operations.
Also receiving an airing during the summit was the report by the High-level Advisory Group on Climate Change Finance (AGF), set up by UN Secretary-General Ban Ki-moon to identify sources of finance to raise $100 billion a year from 2020 to help developing countries adapt to climate change and transition to low-carbon economies. The AGF report suggested aviation and shipping could be potential sources of funding from levies on international passenger tickets or fuel or through a global emissions trading scheme (see story). At a carbon price of around $25 per tonne and predicted total emissions from aviation of 800 Mt in 2020, the AGF believes up to $3 billion per year could be raised from aviation.
One of the major outcomes from Cancun was an agreement to establish the Green Climate Fund that will seek to raise and distribute the $100 billion pledged by the rich countries. The AGF and its report were outside the UNFCCC process and so although its findings were discussed it was not officially introduced into COP 16 negotiations. However, the work carried out by the prime ministers of Norway and Ethiopia and world figures such as Lord Nicholas Stern and George Soros could form an important reference source for the Fund, which will be managed under the auspices of the United Nations.
The Cancun agreement invites the head of the UNFCCC, Christiana Figueres, to convene a new transitional committee to begin work on the formation of the Fund and second staff from the UN and other international institutions to support the work of the committee. The 40-strong transitional committee or board will include 15 members from developed countries and 25 from developing countries. It is anticipated the committee will be finalized next year so that work can begin on the fund structure ahead of COP 17 in Durban.
Aviation industry representatives are sceptical that the sector will be a target for the Fund. “Despite all of the hype before COP 16 about using aviation and shipping as a source of funds for climate adaptation, it is clear that many states, including many developing countries that rely on aviation for the growth of their trade and tourism, are now questioning the wisdom of making the crucial links provided by aviation more expensive,” said the ATAG spokesman, although adding “We will be following that process very carefully next year.”
The issue though is of sufficient concern to ICAO that in its pre-COP 16 submission to SBSTA, it said the international aviation sector should not be singled out as a source of revenues for all other sectors.
“This is likely to result in a shortage of resources to facilitate mitigation activities by the international aviation sector itself, and in a disproportionate contribution of resources from this sector as compared to other economic sectors,” it added. “Furthermore, such action could hinder further progress of the globally-harmonized agreement that was adopted by the ICAO Assembly.”
During a side event in Cancun, Taleb Rifai, Secretary-General of the World Tourism Organization (UNWTO), expressed unease over taxation on aviation and highlighted the importance of taking a global approach towards tourism, aviation and climate change.
“Developing destinations, highly dependent on international tourism for income and jobs, would be doubly affected, given their distance to major markets and limited domestic markets, if exposed to increasingly stringent emissions policy on aviation,” he said. “We are particularly concerned about the potential duplication of taxation on emissions on travel, namely on air transport.
“International air transport has been singled out for separate mitigation treatment under the United Nations Framework Convention on Climate Change (UNFCCC). It is crucial to consider that any mitigation measures adopted in this respect will significantly impact the tourism sector as a whole, particularly developing countries.”
UNWTO highlighted its work with ICAO and the United Nations Environment Programme (UNEP) to address aviation emissions at the global level.
Two major objections to the suggested levy on international aviation fuel or passenger tickets are that it does not directly encourage or promise a reduction in aviation emissions and it cuts across the CBDR issue as such a levy would have to be applied equally and globally, encompassing developed and developing countries alike. On the other hand, the third option suggested by the AGF, a global emissions trading scheme, could form the basis for the elusive sectoral agreement the industry, and others, so badly want.