UK government uncertainty over whether to include international aviation emissions in carbon budgets
Tue 23 Oct 2012 – With emissions from aviation and shipping likely to make up a quarter of the total UK output by 2050, it would be impossible to achieve national climate objectives without including the two sectors in reduction targets, the head of the Committee on Climate Change (CCC) told a House of Commons select committee last week. Under the UK’s flagship Climate Change Act 2008, the UK government is required to tell Parliament before the end of the year whether it intends to include the sectors’ international emissions in its legally binding carbon budgets but it is yet to reach a conclusion. Representatives from the UK aviation and shipping industries told MPs they were comfortable with the inclusion but a government minister and officials said the issue was complex and were equivocal about what decision would be made, which has left environmental groups unhappy. A possible scenario could be for the government to accept inclusion of international aviation emissions in principle but wait on developments with the EU ETS and at ICAO.
The UK target to reduce emissions by 80% by 2050 compared with 1990 has to include aviation and shipping, David Kennedy, Chief Executive of the CCC, which is the UK government’s advisor on climate change, told the committee. “For the government not to accept our advice would be a watering down of ambition,” he said.
The target is to cut overall UK emissions back to 160 million tonnes of CO2e by 2050, with aviation and shipping making up 40 million tonnes of the total. Without their inclusion it would require an 85% reduction from other sectors, he said, adding: “As it doesn’t involve any extra costs, why wouldn’t you do it?”
Said Kennedy: “If we went for a UK unilateral approach to aviation or shipping then there would be costs associated with that. This is an accounting tidy up which is why we don’t favour the UK going on a totally different path. We are very clear that the basis for inclusion should be European or international policies that are in place or we expect to be in place.”
He said the amount for emissions from aviation to be added in to the carbon budgets should reflect the cap set under the EU ETS, although the challenges from China, the United States and other countries against the EU ETS had raised questions about the scheme and about the appropriate timing to bring in aviation emissions. “Do you bring them in now, when the EU ETS cap may change, in which case you might change that number in the future, depending on what happens with the EU ETS or a global agreement at ICAO, or do you wait? Because there is a high degree of uncertainty we will not do that until there is a resolution.
“There is a debate to be had about the precise timing but the principle should be very clear that these emissions should be in the carbon accounting framework.”
Greg Barker, the UK’s energy and climate change minister, told the committee that the coalition government took the issue of aviation and shipping emissions “very seriously” and recognised they should be dealt with at an international level to be most effective.
“We believe the EU ETS is the most cost-effective way of reducing net aviation emissions. The question of how to reflect international emissions within the UK’s domestic carbon accounting framework is, however, a complex one. The methodology required to implement any decision to include them is also complex and will require very careful verification indeed. It is for these reasons that the emissions were excluded from the Act in 2008.”
He pointed out the targets defined in the Act did not include international aviation and shipping but the CCC’s targets did.
He said that due to the complexity, consultations were still ongoing with “cabinet colleagues” over the environmental and economic impacts of a decision but his department was testing the validity and robustness of the CCC’s methodologies, particularly in relation to Aviation EU ETS data it had recently received. He said a decision would be reported to Parliament before the end of the year and would take careful account of CCC advice.
An official from the Department for Transport (DfT) told the hearing that as well as the environmental impact of a decision, a very important factor was costs. He said it was key that international agreements delivered the necessary levels of ambition in emissions reductions. Another DfT official said there were cost implications for UK industry as a whole of between 0.5 and 2% of GDP beyond the 4th Budget period (2023-2027) if international aviation and shipping emissions were included, even though there may be environmental benefits.
Barker declined to answer a suggestion by the chairman of the House of Commons Energy and Climate Change Committee, Tim Yeo, that it was possible the government might accept the CCC’s recommendation in principle to include international aviation and shipping emissions but to implement it at a later date due to current international political uncertainties.
The minister did admit that the hostile scale of the opposition by major powers to the inclusion of international aviation emissions into the EU ETS was “clearly a very serious challenge” but he believed there was still some way for the negotiating process to run and there was a need for ICAO to engage. A DfT official said the UK was working closely with both ICAO and IMO, in particular on the ICAO CO2 standard. Good progress was being made, although not fast enough for some stakeholders but negotiations were complex, he added.
Representing the UK aviation industry at the hearing, Dr Andy Jefferson, Programme Director with the Sustainable Aviation group said he supported the inclusion of international aviation emissions in UK carbon budgets, based on the UK share of the EU ETS cap as long as delivery was met through internationally agreed carbon trading.
He said an appropriately implemented EU ETS was a good starting point towards a global carbon trading solution encompassing all of aviation that ensured a level playing field for all participants. “We do not support unilateral UK targets, however, as we believe this will lead to carbon leakage, market distortion and the loss of economic benefit to our international competitors,” he added.
Putting forward an international perspective, Andrew Herdman, representing the Air Transport Action Group (ATAG) and who is also Director General of the Association of Asia Pacific Airlines, warned the committee that the UK aviation sector would pay a high price through global uncompetitiveness if the UK government and the EU pursued unilateral policies. He said it was a “flimsy bridge” for UK policy-makers to base their targets on the EU ETS.
“Even if you buy the argument about an accounting tidy-up, I would caution about putting international aviation emissions into the carbon budget at this juncture given the uncertainty over the EU ETS and what form an ICAO global scheme might take,” he said. “The accounting and allocation of emissions is the nub of trying to structure a global agreement.”
Dr Keith Allott, Head of Climate Change at WWF-UK, said excluding aviation and shipping emissions from the carbon budget would raise fears about the government’s commitment to the climate change Act and to 2 degrees warming. He said there were concerns that certain government departments, including the Treasury, were resistant to the CCC’s recommendations because of the cost implications.
His organisation also supported a global agreement for aviation but, he added, no industry can get a free ride, either on dealing with climate change or on contributing its fair share of the tax burden.
After the hearing, Allott’s concerns over the possibility that the CCC’s recommendations may not be taken up by the government were expressed in a statement from AirportWatch, an umbrella group of environmental campaigners.
“It appears that the Treasury and the DfT are prepared to sacrifice crucial longer term goals for the sake of unproven short-term savings,” said its Communications Director, Susan Pearson. “Yet it is absolutely clear that exclusion of aviation and shipping emissions from the UK’s carbon targets would seriously weaken our commitment to reducing global carbon emissions. The need for carbon reduction is as urgent as ever – why would the UK consider watering down our targets? There is no room for badly thought out exclusions.”