European Commission launches consultation on market-based measures to reduce international aviation emissions
Wed 9 Mar 2016 – The European Commission has opened a consultation on international and EU policies to reduce international aviation emissions through the use of market-based measures, in particular focusing on the outcome of efforts at ICAO on a global measure and the implications for the Aviation EU ETS. A temporary EU derogation is in place that reduces the original scope of its emissions trading scheme to allow ICAO to negotiate a global market-based measure (GMBM) at its forthcoming Assembly in the autumn. The derogation ends on December 31 and the EU ETS reverts automatically to full scope coverage of emissions from all flights to and from European airports without the adoption of new legislation. The Commission is looking to put forward proposals soon after the Assembly finishes in October. Meanwhile, the Irish Department of Transport has just concluded a stakeholder consultation on the ICAO GMBM and its counterpart in the UK held a workshop on Monday to inform stakeholders of progress on the GMBM.
The Commission says it is seeking input from stakeholders and experts in the field of aviation or climate change on international and EU policies tackling climate change impacts from international aviation emissions through market-based measures (MBMs). The questions posed in the consultation cover the policy options currently being developed at ICAO and in relation to the future direction of the Aviation EU ETS.
The pre-amble to the consultation notes that CO2 emissions from international aviation are expected to grow by at least 250% from 2005 levels by 2050, whereas the Paris climate agreement reached last December requires a peaking of all global GHG emissions as soon as possible and rapid reductions thereafter. This significant mitigation effort, it says, entails taking firm action on all emission sources, including aviation. Technological and operational measures will not be enough and as marginal abatement costs in the sector are generally high, it adds, MBMs are a relatively low-cost and attractive choice.
The current reduced scope of the Aviation EU ETS, which applies to emissions from all commercial flights between EU/EEA (excluding outermost regions and Switzerland) airports, has seen around 16 million tonnes of CO2 emissions mitigated annually – about the same as the country of Slovenia – with a compliance rate of 99.6% of all emissions covered by the scheme, reports the Commission.
According to Article 28a of the EU ETS Directive, the Commission is required to inform the European Parliament and EU Member States (the Council) of the progress made in the ICAO negotiations, and actions to implement an international agreement on a GMBM from 2020. The provision states the Commission shall “consider, and, if appropriate, include proposals in reaction to, those developments on the appropriate scope for coverage of emissions from activity to and from aerodromes located in countries outside the EEA from 1 January 2017 onwards.”
Damien Meadows, a Commission official with the climate directorate (DG CLIMA), told a recent seminar in London organised by environmental commodities trader Vertis that any new legislation would need to be in place before the requirement for aircraft operators to report their 2017 emissions by the end of March 2018.
The legislative process during 2017 would require, said Meadows, the formal appointment of an MEP as rapporteur in the European Parliament and discussions between political parties on possible amendments, the development of positions by Member States in the Council, agreement of new legislation and a review by the European Court of Justice. After co-decision by the Council, Parliament and Commission, he expected legislation to be adopted during the UK presidency of the EU in the second half of 2017.
Under the current legislation, small non-commercial aircraft operators whose annual emissions are under a 1,000 tonne threshold, such as business jet owners, are exempted. However, that exemption automatically ends in 2020 and the Commission is seeking views in the consultation on what action should take place from 2021.
The Commission is also carrying out an impact assessment (IA) it plans to complete immediately after the ICAO Assembly and will help inform its eventual EU ETS proposals from the outcome. Should Parliament and Council not adopt an amendment by March 2018 and the legislation reverts to full scope coverage of emissions from intercontinental flights arriving and departing from Europe then opposition from third countries would likely result as before, says the IA document.
Questions covered by the consultation, which closes on May 30 and is open to responses from those both inside and outside the EU, include:
Following the Paris Agreement, what effort is required from international aviation and how should this develop over time?
Which elements should emerge from the ICAO Assembly to provide for the implementation of a robust GMBM by 2020?
In what ways could action by countries to achieve their respective climate goals, notably by addressing domestic aviation emissions, complement and interact with a global MBM?
Which should be the main principles and criteria guiding an EU ETS review following the Assembly?
Which options should be considered for the EU ETS for the period 2017-2020 and beyond 2020?
Which elements of the EU ETS could be considered in order to take into account international developments as well as improve its environmental effectiveness?
Meanwhile, the Irish Department of Transport has just closed a short three-week consultation on a draft policy proposal for a GMBM scheme presented by the ICAO President in December.
On Monday, the UK Department for Transport held a workshop for stakeholders on GMBM progress and the main design elements of the proposed scheme, although some changes are believed to have been made since first presented.
Officials said Europe favoured certain proposals put forward by the President such as the applicability of the scheme to operators and not to States; a route-based approach to address differentiation; a three-year review of the scheme; a 100% sectoral share for distribution of obligations; and a commitment to MRV development. However, there are concerns over a cost safeguard mechanism for emissions units; a sunset clause in which the scheme ceases if total emissions go below 2020 levels for three consecutive years; exemption provisions for new aircraft operator entrants; a three-year compliance cycle; and the carbon-neutral growth goal not being met due to exemptions and a phased-in approach.
States will learn more about the GMBM proposals and provide feedback when the 2016 round of ICAO Global Aviation Dialogues (GLADs) start in Cairo on March 20, followed by similar events in Dakar, Senegal (March 23-24), Legian, Indonesia (March 29-30), Utrecht, the Netherlands (April 4-5) and Mexico City (April 7-8).