Addressing international aviation emissions
by Peter Maniloff -- December 8th, 2009
The EU starts to grapple with adding aviation to cap-and-trade.
EU CO2 emissions from international aviation have nearly doubled since 1990 and are now the second-largest source of emissions in the EU (after electricity generation). They are projected to double again by 2020, but were not covered under the Kyoto Protocol and thus are not currently covered by the EU ETS. This morning, the EU held an official side event on their plan to add international aviation to the EU ETS in 2012.
Their proposal will cover all large airlines flying into or out of EEA airports. However, while discussion in the US has focused on upstream regulation to minimize the number of compliance entities, this plan will directly regulate airlines. EU representatives explained that this is because of the need to comply with international aviation law.
The point-of-regulation decision has an economic angle, too. If aviation fuel refiners were required to cover the emissions from the burning of their fuel, then airlines could simply purchase extra fuel outside the EU, then fly overladen planes in. This would result in leakage of emissions and in inefficiently heavy planes (and thus lower fuel efficiency and higher costs).