UK wobbles as US legislators join with China in opposing EU plans to include third countries in revisions to EU ETS
Mon 2 Dec 2013 – As EU legislators work on proposals to amend the scope of the EU Emissions Trading Scheme (EU ETS), their US counterparts in the House of Representatives have called on the US Transportation Secretary, Anthony Foxx, to exercise his authority to prohibit US civil aircraft from participating in the scheme. Bipartisan leaders from the Transportation Committee urge Foxx to negotiate with the EU to ensure US operators “are held harmless from the unilateral application of the EU’s system”, which they argued was in contravention with the recent ICAO agreement. China has also voiced its displeasure at the proposals, saying they were detrimental to international solidarity in addressing climate change and that the UNFCCC principle of common but differentiated responsibilities must underpin the design and implementation of a global market-based measure. The UK, meanwhile, has signalled that it too is against the Commission’s proposals to include flights to and from third countries.
A letter from leading members of the House Transportation and Infrastructure Committee and the Aviation Subcommittee says the proposed EU amendment to the ETS “violates the spirit and letter of the ICAO agreement, as it would unilaterally be applied to portions of US flights to and from the EU.”
The amendment, the lawmakers argue, “flouts” the agreed upon framework developed by ICAO. “So despite claims that it wanted to address aviation emissions through international agreement at the ICAO, apparently the EU only wants to abide by the parts of the ICAO agreement it likes.”
Therefore, they urge Foxx to engage in immediate negotiations, as set down in the ETS Prohibition Act that came into law in late 2012, and if the EU amendment is still passed then he should prohibit US aircraft operators from participating in the ETS if determined to be in the public interest.
“In making this determination, the Secretary is to take into account the impacts on US consumers, air carriers and operators; the impacts on economic, energy, and environmental security of the United States; and the impact on US foreign relations, including existing international commitments,” said the letter.
The Act remains the “law of the land”, they said, “and, therefore we urge you to act in the public interest and fully exercise the authority granted to you under the law. ICAO set forth an agreed upon process for developing a global approach to address aviation emissions and it remains the proper forum to achieve this goal.”
A senior US Department of Transportation official told the Future of Air Transport conference in London last week that the Commission’s proposals were an “unnecessary distraction”.
In an intervention at the recent UNFCCC COP 19 in Warsaw, China noted that “some regions and states still decide or plan to take unilateral measures on international aviation and maritime transportation” despite decisions that had been made at an international level that agreement should be reached through bilateral or multilateral consultation. Without specifically identifying the EU’s airspace proposal, the intervention said: “These actions will be inevitably detrimental to the cohesion and solidarity of international actions addressing climate change, set a bad precedence for UNFCCC and its Kyoto Protocol, and impair [the] sustainable development of these two sectors.”
The Chinese intervention followed the presentation of the annual reports to the UNFCCC’s Subsidiary Body for Scientific and Technological Advice (SBSTA) by ICAO and IMO. The ICAO report focused on the outcome of the recent Assembly climate change resolution (A38-18).
“China welcomes the Resolution of ICAO adopted at its 38th Assembly that the principles of CBDR and mutual agreement should underpin the work of designing and implementing the market-based measures for emissions from international civil aviation,” said the Chinese representative. “We also welcome the Resolution of IMO adopted at its 65th MEPC session that [re]cognizes ‘principles enshrined in the UNFCCC and its Kyoto Protocol including the principle of CBDR’. These are major milestones, which reflect efforts and constructive attitudes by member states of the two organisations to reaffirm the principle [of] the Convention. We are glad to note that, either in or out [of the] UNFCCC, actions addressing global climate change have moved towards integrity and consistency.
“Therefore, China strongly encourages member states of ICAO and IMO to further implement these principles in their formulation of GHG reduction instruments, [and to] recognise differences between developed and developing states. We also request aforementioned regions and states return back to the track of multilateral negotiation and consultation, fully respect the primacy of UNFCCC as the principal framework in addressing the climate change, and refrain from impairing the sustainable development of international aviation and maritime transport.”
The inclusion of the CBDR principle in the ICAO Assembly resolution, it should be noted, was subsequently rejected in reservations filed by developed countries, including European states and the US (see article).
As the biggest ever UK trade mission to China gets underway, led by Prime Minister David Cameron, the UK has signalled that it too is against the Commission’s airspace proposal and wants to extend at least until 2016 the ‘Stop-the-Clock’ scope adopted for 2013 as it does not wish to face international opposition and possible retaliation.
“The UK objective for the current negotiations on Aviation EU ETS is for the Member States to reach agreement with the European Parliament by next April on a scope which will achieve a high level of compliance and reduce the risk of international retaliation, with a view to facilitating an agreement in 2016 on a global market based measure for aviation emissions,” a spokesman for the UK’s Department for Energy and Climate Change (DECC) told GreenAir.
“We currently feel that a scope for the EU ETS covering flights within the European Economic Area (i.e. an extension of the Commission’s proposal for 2013) would be the best way to achieve this.
“Negotiations are still at a relatively early stage, albeit with clear time pressures, and we will be discussing this with other Member States and MEPs over the coming days and weeks with a view to finding an acceptable compromise.”
Although neither has so far publicly commented, France and Germany are believed to support the UK position. The three countries have major stakes in Airbus and faced with threats by China to suspend buying Airbus aircraft, they were reported to have put pressure on the Commission in 2012 to rein back the full scope of the EU ETS, which resulted in the one-year Stop-the-Clock (STC) derogation pending the outcome of the 2013 ICAO Assembly.
Under STC, only emissions from intra-EEA flights are included in the scheme. Although Chinese and Indian airlines are believed to have made intra-EEA flights they have not indicated they will comply with the EU ETS directive. Last week, Peter Liese, the Parliament’s rapporteur on the Aviation EU ETS said it was unacceptable for him and Parliament for third countries like China and India to refuse to even comply with the STC legislation when operating inside the European Union.
A clash between EU Member States, represented by the European Council, and the European Parliament now looms. There is a very tight legislative timescale already and a new Commission proposal would have to be formalised, along with fresh consultation with industry and other stakeholders. European airlines and NGOs are unlikely to be happy with a continuation of STC, even if only until 2016. A decision would also have to be made on the many thousands of business jet operators, the so-called ‘small emitters’, which are currently included under STC but are to be exempted from the EU ETS under the current proposals. If the new legislation is not in place by April, there is an automatic ‘snap back’ to the full scope of the directive for all flights to and from EEA airports.
With some amendments, Liese broadly supports the Commission’s proposals to limit the scope of the EU ETS to emissions taking place within EEA airspace, which would capture flights to and from third countries (see article).
He said STC adversely affected the competitive situation for European airlines and airports, adding: “A simple extension of Stop-the-Clock’ could be considered an unconditional surrender by the European Union. If there is progress at international level, it is mainly through the pressure by the European Union, so we need to stick to our commitment.”