Last fall, when Democrats and Republicans seemed unable to agree on anything, one bill glided through Congress with broad bipartisan support and won a quick signature from President Barack Obama: the European Union Emissions Trading Scheme Prohibition Act of 2011.
This odd law essentially forbids U.S. airlines from participating in the Emissions Trading System, Europe’s somewhat lonely attempt to rein in planet-warming emissions. Under that 8-year-old program, European power plants and manufacturers pay fees if they produce excess carbon emissions. The aviation sector was slated to start paying this year, too, for emissions generated by flights into or out of EU airports.
But after airlines and governments in the United States, India and China went ballistic — filing lawsuits, threatening trade actions and prompting legislation — the European Commission said it would delay full implementation for just one year to let the naysayers accede to an alternative global plan to reduce airlines’ carbon footprint.
Now, all eyes are on Americans.
With Obama’s promise in his inaugural address that dealing with climate change is part of his second-term agenda, emissions are back at center stage. The United Nations’ International Civil Aviation Organization is convening a multinational meeting in September on the airlines issue, one of the thorniest in climate change.
For many people reading this, air travel is their most serious environmental sin. One round-trip flight from New York to Europe or to San Francisco creates about 2 or 3 tons of carbon dioxide per person. The average American generates about 19 tons of carbon dioxide a year; the average European, 10.
So if you take five long flights a year, they may well account for three-quarters of the emissions you create, depending on where and how you live. “For many people in New York City, who don’t drive much and live in apartments, this is probably going to be by far the largest part of their carbon footprint,” says Anja Kollmuss, a Zurich-based environmental consultant. (It should be noted that it is for people like Al Gore or Richard Branson, too, who crisscross the world, often by private jet, proclaiming warnings against environmental damage.)
Though air travel emissions now account for only about 5 percent of warming, that fraction is projected to rise significantly, since the volume of air travel is increasing much faster than gains in flight fuel efficiency. (Also, emissions from most other sectors are falling.)
Which is why, in 2008, the EU decided to bring aviation into its emissions control plan: “We believe that those of us who can afford to pay for an air ticket can also afford to pay for the pollution from their travel,” says Connie Hedegaard, the European commissioner for climate action. “Many Europeans don’t get why, politically, this should be controversial.”
Though many airlines have tried to reduce their carbon footprints through technical innovations — like more efficient aircraft designs and biofuels blends — they have successfully resisted any regulation or taxation of their emissions.
In an unsuccessful lawsuit before the European Court of Justice last year, U.S. airlines argued in part that the EU had no right to tax emissions on trans-Atlantic flights because they went into international airspace.
Airlines for America, a trade group for U.S. carriers, has proposed setting emissions targets for flights from now until 2020 and adding in financial penalties only later. “The problem with the European trading scheme is that it started with a market-based measure — a tax,” says Nancy Young, the group’s vice president for environmental affairs. “We would accept a market-based mechanism only as a gap filler, if we don’t meet our targets. And we will be saying that very strongly.”
She said the European scheme was “extremely burdensome” and would cost U.S. airlines $3.1 billion between 2012 and 2020, adding, “It takes money out of U.S. aviation and puts it into European coffers.”
But some in the industry contest that view. “I think airlines typically overstate how difficult this is,” said David Hodgkinson, former director of legal services at the International Airline Transport Association, an industry group, who now practices aviation and climate law in his native Perth, Australia. “I don’t get why opposition is so fierce given that this is relatively straightforward and the cost is typically low and passed on to passengers.”
He said that Qantas, the Australian airline, is going along with the European scheme, under which airlines must buy so-called carbon allowances if they exceed assigned annual emissions targets, which decrease year by year.
Some analysts estimate that the European program would add about $5 to the price of a typical trans-Atlantic flight. While that may sound minimal, Young maintained that U.S. airlines operate on razor-thin margins. She said, “This may be the difference between loss and profitability.”
Others note that ticket prices could ultimately rise much higher as a result of the plan. The price of carbon credits varies like a stock and is now at a record low. Kollmuss, the environmental consultant, said, “If the price went up, not so many people would fly to Europe or California on such a regular basis.”
This year, the EU is collecting the emission payments on flights within Europe as per the original schedule. That has made it harder for European carriers to compete in a cutthroat industry, said Thomas Kropp, a senior vice president at Lufthansa.
Hedegaard, the EU commissioner, said that if the International Civil Aviation Organization fails to come up with a solid, market-based program in September, the EU will begin collecting the emissions fees for all flights in and out of its airports.
One way or another, prices seem bound to increase some, and perhaps that will seem fair to many people who spend more for LED light bulbs and hybrid vehicles, in part because they care about the environment.
At a global level, how the U.S. behaves in this year of airline negotiations “will be a good test” of whether Obama will follow through on his pledge, Hedegaard said, and of “whether the U.S. is now going to engage more strongly in climate in the international arena.”