ICAO Assembly resolution on climate change runs into trouble over de minimis exemptions for states
Tue 12 Oct 2010 – A proposal by Europe ahead of the ICAO Assembly that countries with insubstantial international aviation emissions could be exempted from collective global emissions reduction goals has led to serious and seemingly unintended consequences for the Assembly resolution passed last Friday. The so-called ‘de minimis’ provision is used by Europe to exempt smaller operators with a low threshold of flights from the EU Emissions Trading Scheme (EU ETS). During last-minute negotiations to find a compromise agreement between ICAO member states, de minimis clauses were added to the resolution that exempt states with an international aviation activity of 1 percent of total revenue tonne kilometres from obligations to submit action plans to reduce their emissions and also from market-based measures such as emissions trading schemes. However, based on ICAO 2009 traffic data, nearly 170 states fall below the threshold, a number of whom with carriers to be included in the EU ETS. As a result, Europe has had to enter a ‘reservation’ on the clauses.
There are just 22 countries on the ICAO list of scheduled tonne-kilometres (TKs) performed (includes passengers, freight and mail) with international aviation emissions more than 1% of the total 359,180 million TKs for the 190 ICAO member states in 2009. Of these, eight are developing (non-Annex I) countries: China, UAE, Republic of Korea, Singapore, India, Thailand, Malaysia and Qatar. Below the threshold are EU states such as Italy, Portugal, Finland, Austria and Belgium.
Quite how and why the threshold level was set is so far unclear but the 1% figure was, according to sources, proposed by Nigeria and supported by South Africa, although there were other proposals for lower threshold levels. The 22 countries, however, do cover around 82% of international scheduled TK traffic.
The Assembly resolution says that states below the threshold are not expected to submit action plans outlining their respective policies and actions to reduce international aviation emissions or required to report their annual emissions. In addition, commercial aircraft operators of states below the threshold should qualify for exemption from the application of MBMs that are established on national, regional and global levels.
It has been suggested in some quarters that some non-EU states, who oppose the introduction of the EU ETS, agreed to the threshold as a means for their operators caught up in the scheme to be exempted. The US is reported to be among those who supported the de minimis clauses. Industry groups, outside the negotiations, were thought to be opposed.
Given the potential consequences, Europe has entered a reservation on the clauses, thereby refusing to be bound by them.
A European Commission official told GreenAir Online that the EU would only consider agreeing to such de minimis exemptions if there were to be ambitious emissions reduction goals with binding commitments to meet such goals. “This was not forthcoming, therefore we cannot accept the whole state exemption concept, including the 1% threshold.”
He said that during the Assembly negotiations there had been a strong call for more review of the concept as it could result in significant market distortion. “Many states rejected the 1%,” he added. The official believed other states above the threshold would also file reservations. He dismissed any expectations that the de minimis clauses could trigger a change to the EU ETS.
The Assembly resolution calls for the ICAO Council to review the threshold to market-based measures by the end of 2011, which leaves unclear what is expected in the meantime of the 168 countries in terms of meeting the collective aspirational global goals laid out elsewhere in the agreement.
Comments by the European Commission Vice-President – and also Transport Commissioner – Siim Kallas after the ICAO Assembly resolution had been agreed, along with a statement released by the Commission, led to speculation yesterday that the EU may be willing to soften its line on carriers from third countries entering the EU ETS. The statement referred to the EU agreeing to “engage constructively in dialogue with third countries during the implementation of its ETS, notably regarding how to deal with emissions from incoming flights from third countries.”
Kallas is reported to have told a news conference yesterday: “We are ready to negotiate and to talk about these issues and not only make declarations. Adequate measures from other countries can be taken into account.”
The New York Times quotes Commission officials as saying American carriers might be able to qualify for an exemption on outgoing flights if the US government agreed on “one or more measures, like better air traffic management to cut carbon emissions in the US and a passenger tax at US airports representing a fee on such emissions.”
In response, GreenAir’s Commission official said: “I am not aware of any watering down regarding equivalent measures, we are willing to examine all proposals.”
In order to exempt incoming flights from third countries, the relevant EU Directive requires third countries to implement “equivalent” measures to the EU ETS in terms of reducing the climate impact of those flights to the EU, having in mind similar cap-and-trade schemes.
The US, along with Canada and Mexico, had proposed ahead of the ICAO Assembly that MBMs should only be imposed by one state or region – a heavy tilt at Europe’s ETS – on the basis of “mutual agreement”. The wording, opposed by the EU, did not find its way into the final resolution but Bill Hemmings of Transport & Environment, who represented NGOs at the Assembly, believes the EU may have to make concessions on the EU ETS as a result. He estimates that excluding inbound flights to the EU would cut the emissions covered by the scheme by 40%.
Hemmings dismissed the ICAO Assembly outcome. “The Assembly represented a race to the bottom to reach consensus at almost any cost, followed by a descent into farce as many countries distanced themselves from various aspects of the resolution. ICAO’s irrelevance grows along with emissions from the world’s most energy and carbon intensive form of transport,” he said.
“As a forum for agreeing, let alone implementing, global environmental targets for aviation emissions, ICAO is clearly not fit for purpose, its 13-year record of failure shows that. The fact that ICAO members repeated their calls this year for the institution to remain in charge looks absurd and completely out of touch.”