The International Civil Aviation Organization launched a new carbon offset standard on Thursday governing how much passengers should pay to offset their emissions footprint. The standard immediately came under fire in Europe when an official at Germany’s emissions trading organization said it underestimates the industry’s contribution. The announcement came on World Environment Day at a United Nations environment conference. While it has yet to post it on its web site, ICAO’s new carbon calculator, measuring only carbon dioxide emissions from burning jet fuel, will be located at www.icao.int/, at the bottom of the left hand column.
At the same conference the head of the European Commission’s Delegation to the United States Ambassador John Bruton, blasted airline contentions that aviation emissions only constitute two percent of emissions and thus should not be part of the emissions trading scheme. "Although skeptics point out that the aviation sector currently only accounts for about three percent of global greenhouse gas emissions each year,” he said, “this is approximately the same percentage as the steel industry and oil refining industry, both of which are regulated under the EU's cap-and-trade system.”
He also said that aviation emissions are increasing more rapidly than that from other industries, pinpointing the growth of leisure passengers as the culprit. He indicated their demand alone is expected to double from 842 million in 2006 to 1.6 billion in 2020. The ambassador also cited a report by U.S. Department of Transportation, Eurocontrol, Manchester Metropolitan University and QinetiQ which said airline CO2 emissions are 20 percent more than thought.
"Two-thirds of EU aviation emissions come from intercontinental flights, so if we hope to make a significant impact, we must include international flights in the cap-and-trade system,” he said, according to Bloomberg. “If the sheer quantity of greenhouse gases being emitted is not enough, the Intergovernmental Panel on Climate Change (IPCC) has concluded that emissions from airplanes have between two and four times as great an impact on the climate as emissions at ground level, due to the warming effect of emissions at high altitudes.”
Bruton also noted that collaborative programs between the EU and U.S. currently reduce emissions by two percent while air traffic is growing at five percent annually, leaving a net increase between three and four percent annually. However, Bruton is presuming that aviation interests will do nothing to further reduce emissions. Indeed, Air Transport Association President James May pointed out in a recent op-ed that between 2000 and 2006, airlines reduced fuel burn and greenhouse gas (GHG) emissions by four percent - while moving 12 percent more passenger traffic and 22 percent more cargo traffic.
While press reports suggested the new ICAO standards ignore the impact of water vapor and nitrous oxide, industry experts know there is much research to be done before the impacts of either are more well known. Even so, Reuters indicated said, “Scientific assessments of such multipliers range roughly from one to three times the carbon dioxide emissions of flights alone. By ignoring these ICAO assumes a multiplier of one.” However, it also quoted Kevin Anderson at Britain's Tyndall Center for climate change research who said that while carbon dioxide stays in the air for centuries, other emissions do not and thus require other policies.
Controlling the environmental impact through emissions trading schemes is now under attack in Washington where airlines have been making the point that the proposed cap-and-trading scheme, part of the Lieberman-Warner Climate Security Act of 2008, on which hearings were held last week, amounts to little more than a tax at a time when the industry can least afford it. The bill seeks to develop a 66 percent reduction in greenhouse gas emissions by 2050. It would also reduce emissions annually from power plants, manufacturers and others by two percent below 2005 levels starting in 2012. Recent amendments to the bill by Sen. Barbara Boxer, D-Calif. offer billions in incentives to industries producing green technologies for energy and autos.
In Forbes’ recent focus on aviation, it said an Environmental Defense Fund-developed cap-and-trade mechanism worked in the 1980s to reduce sulfur dioxide emissions, the source of acid rain. “As it stands now, the federal government is spending $40 billion a year to address climate change," Institute for Energy Research Brian Kennedy, told the magazine, adding research on capturing and sequestering carbon emissions, tax credits for renewable energy and vehicle fuel standards have been more success that the European Union efforts. The magazine cited a study National Association of Manufacturers study saying the Lieberman-Warner bill would cost 1.8 million jobs and a $210 billion GDP drop as well as a 33 percent increase in electricity prices by 2020.
EDF disputes these costs saying it reviewed five separate cap models developed by government and academia which showed the GDP impact would be less than 0.5 percent between 2010 and 2030, while job losses would likely be closer to “business as usual.”
The conservative Washington Times editorialialized, however, thinking of cap-and-trade schemes as a tax is a myth. “As the jockeying intensifies,” it wrote, “let us first dispense with the fiction that ‘cap-and-trade,’ Warner-Lieberman or the Boxer amendment are ‘market solutions’ for mandated carbon limits. The ‘market solution’ to distributing the burden of carbon reductions, if one supports such a goal (we do not), would become a tax. Instead, Warner-Lieberman creates an artificial carbon scarcity with pollution rights that vary by producer. This means there are winners and losers: the latter includes constituents of the U.S. Chamber of Commerce, the National Association of Manufacturers and the Air Transport Association (ATA), to name three. The winners include proprietors of environmentally friendly technology and ‘green’ investors.”
In the same edition, ATA's May, in an op-ed, disagreed. “The bill, if enacted, would impose a carbon tax on the airline and other transportation industries,” he said, “This would throw a cold, wet blanket on a U.S. economy that is already hamstrung by soaring food and energy costs. Compounding injury with irony, the Lieberman-Warner bill would require cash-strapped airlines to remit their carbon taxes to cash-rich oil companies.”
He reiterated the industry’s environmental record and the fact that aviation economics dictate finding more fuel efficient solutions, especially in a high fuel environment. “Between 1978 and 2007, U.S. airlines improved their fuel efficiency by 110 percent," he wrote. "In fact, U.S. airlines account for only two percent of this nation's GHG emissions. Yet they drive three times more economic activity. No other industry is more economical and carbon-efficient in moving people and critical goods….Let us assume that emissions allowances are modestly priced at $25/metric ton of carbon-dioxide equivalent (CO2e) in 2012 when the bill would go into effect: In this scenario, this legislation would add another $5 billion to the airlines' fuel costs. These costs would escalate each year thereafter. Such costs would result in further job losses, higher ticket prices, elimination of services and a negative economic ripple effect beyond what we are experiencing today.”
He called for the federal government to focus on measures that complement the airlines' initiatives and enhance transportation infrastructure. For example, he said, modernizing the nation's aging air traffic control (ATC) system would enable more efficient flying routes and decrease emissions by an additional 10 to 15 percent.
May also said airlines should receive credit for the work already accomplished to reduce emissions. “If a cap-and-trade system is applied to aviation, why doesn't Congress reinvest proceeds into aviation, allowing for additional funding of programs and technologies (ATC modernization, environmentally-friendly synthetic jet fuels, etc.) that promise to further reduce aviation's GHG emissions,” he asked. “Congress should work with the airlines so as not to counter the industry's investments.”