ATA calls on Congress to support and fund initiatives to help reduce US commercial aviation GHG emissions
James C. May, ATA, presents his testimony to the Select Committee
Thu 3 Apr 2008 – Appearing yesterday before the US House Select Committee on Energy Independence and Global Warming, Air Transport Association (ATA) President and CEO James C. May said there was a critical role for the federal government to play in efforts to reduce GHG emissions by US airlines and urged Congress to “calibrate” any climate change-related legislation that included aviation.
May told the Committee that ATA carriers had committed to an additional 30% fuel efficiency improvement by 2025 through investment in new aircraft, new aircraft engines, navigation aids and enhanced procedures.
“In addition,” he continued, “we are dedicating ourselves to developing commercially viable, environmentally-friendly alternative jet fuel, which could be a game-changer in terms of aviation’s GHG output. Moreover, we are central stakeholders in partnering efforts to modernize the outdated air traffic management (ATM) system and to reinvigorate research and development in aviation environmental technology.”
However, he said there were other measures that required a “significant measure” of congressional support. One such example was the congressional approval needed to drive progress on the replacement of the antiquated ATM system, the upgrade of which (NextGen) would bring a further 10-15% gain in overall fuel efficiency.
“Further, commercial airlines cannot stimulate the development of environmentally-friendly alternative jet fuel and aircraft environmental technology on our own,” he stated. “Congressional support and funding, and other incentives are vital to these research initiatives.” May said congressional funding for aeronautics research and development – specifically including for environmental projects – had suffered significant cuts of about 50% in the past 8-10 years.
On behalf of his airline members, May expressed concern over the proposed S. 2191 cap-and-trade legislation, the Lieberman-Warner Climate Security Act, and asked for support from the House of Representatives. He said the bill would impose a “punitive” emissions tax on aviation.
“This would have significant economic repercussions on the airline industry and the economy, as every penny increase in the price of a gallon of jet fuel drives an additional $190-200 million in annual fuel costs for US airlines,” he told the Committee. He said application of the bill would result in annual costs to the airline industry of approximately $5 billion in 2012, which could rise to $9 billion by 2020, based on estimated emissions allowance prices. “It is difficult to imagine how we could handle a GHG-based surcharge on top of the exorbitant fuel prices we are experiencing.”
As proposed, fuel producers would be required to acquire allowances sufficient to cover the GHG content of the fuel they sell to the transport sector. The cost of purchasing the allowances would then be passed on to consumers, including airlines.
“Based on our fuel and GHG efficiency records and commitments, application of a cap-and-trade bill to commercial aviation simply is unnecessary,” said May. “We already are incentivized by the market to minimize GHGs, without further market-based measures. However, if such a measure is to be applied to aviation, it should be carefully calibrated to take key considerations into account, which the Lieberman-Warner bill currently does not do.”
He suggested commercial airlines should be provided with allowances up front, either directly or as a required pass-through from fuel providers, “in recognition of the fuel efficiency achievements we have made to date and the importance of preserving the airlines’ ability to continue to invest in new aircraft technology.”
Another key calibration mechanism, he said, would be to take some of the proceeds generated from the auctioning of allowances and reinvest them in the funding of programmes and technologies that promise to further reduce aviation GHG emissions.
“A fundamental flaw of the bill is that while it proposes to re-channel proceeds from auctions into industries like automobile manufacturing, it does not include any provisions for reinvestment in aviation,” he maintained.
“Further, any climate change legislation proposing to cover aviation should be crafted to take into account the international nature of aviation, not only that aviation is a global industry and that US carriers must compete with the airlines of other nations on many routes, but also that the United States by treaty has agreed that the International Civil Aviation Organization (ICAO) has the authority to establish standards and policy for international flights [pursuant to the Chicago Convention]. Arguably, the United States should defer to ICAO for additional measures addressing aviation GHGs. At a minimum, however, we should ensure that any measures taken in the United States are compatible with our international aviation agreements.”
He concluded by telling the Committee: “While we are fully committed to working with Congress and are asking for congressional leadership and support in each of the areas I have described, we are not asking you to work for us, we’re asking you to work with us in addressing this environmental and energy concern. We also are urging you to refrain from adopting policies that would work against our efforts. A vibrant, competitive and growing aviation sector is a key part of the solution – not an impediment to ensuring a future where a strong economy, freedom from foreign oil and cleaner air are the order of the day.”
Other witnesses attending the hearing included Daniel Elwell, FAA Assistant Administrator for Aviation Policy, Planning and Environment; Bob Meyers, Principal Deputy Assistant Administrator for the Office of Air and Radiation, US Environmental Protection Agency; and Tom Windmuller, Senior Vice President, International Air Transport Association.
Chaired by Rep. Edward J. Markey, the cross-party House Select Committee on Energy Independence and Global Warming was formed by House Speaker Nancy Pelosi “to increase the visibility and priority given to America’s oil dependence and global warming challenges”.