Life after Copenhagen: Retreating for the real work to begin - UPDATE

Many of the issues that dogged Kyoto continued with the have-nots wanting more from the haves to help ameliorate the impacts of climate change. But there was clear progress for aviation, according to Air Transport Association Vice President for Environmental Affairs Nancy Young who sat down with America Airline Daily for a post-COP 15 data dump.

Having largely gained acceptance for the position that the International Civil Aviation Organisation is the proper venue to hammer out any industry-wide climate framework, the next front is forestalling any patchwork of regulations set up by local or regional governments to address the issue, as has already happened with Europe establishing an emissions trading scheme from 2012.

“The coordination of economic measures ensures that aviation will not pay more than once for its emissions,” said Young.

As expected, the Air Transport Association filed suit against the European Union's implemention of its proposed emissions trading scheme (ETS), saying it violates international law. Joining in the lawsuit filed in London are American, United and Continental. The British government will be first to implement the ETS, imposing caps on carbon emissions which will siphon much-needed capital away from airlines which could use the money to re-equip their fleet with greener aircraft.

The suit seeks a European Court of Justice review, charging the plan is too broad, logistically complex and too expensive when the industry is bleeding red ink. ATA said ticket prices would increase substantially for flights to and from EU nations.

COP 15

“The outcome of the two weeks of negotiations at Copenhagen was a high-level accord setting out principles on what countries will aspire to on climate change,” she told AAD. “What that means for aviation is a mixed result but overall good. The accord itself doesn’t speak to aviation. The fact it doesn’t speak to aviation in a fine thing because it is leaving ICAO to do its work. That work will continue and we hope that at the September/October 2010 ICAO assembly we can adopt a more comprehensive framework on greenhouse gas (GHG) emissions. We want a set of targets that are appropriate for aviation fuel efficiency. With that we will build a better foundation for better improvement over time. NextGen has a key role beyond 2020 in neutralizing emissions and policies have to flow from that.”

Like Young, the International Air Transport Association came away from Copenhagen with a sense of relief that the industry’s lobbying mantra – let ICAO do it – gained such wide-spread acceptance.  The goals for aviation, it noted were recognized by member states at the last ICAO High-Level Meeting on the Environment three months ago, noted Director General Giovanni Bisignani. Young also reported that at least the Senate has accepted the principal that ICAO is the proper authority for setting aviation’s goals.

“US legislation should reflect the same set of goals and basket of measures that flow from a set of policies to act consistently with the international framework,” said Young. Waxman Markey [the House bill] includes language on the sense of Congress that say it recognizes ICAO in working on these things and it is better to have our aviation policy flow from that. They didn’t revise provisions that apply a fuel tax to us but they acknowledged they should be doing that. We are trying to actualize that in the Senate legislation. It is not a carve out from domestic legislation but a carve in to a set of policies and agreements that are more appropriate for an international sector like ours.”

Correction: America Airline Daily made a mistake in its discussion on 24-Dec-2009 of the progress of climate change bills moving through Congress. The quote by Air Transport Association Vice President for Environmental Affairs Nancy Young should have also reported that at least the House of Representatives has accepted the principal that ICAO is the proper authority for setting aviation’s emissions goals. Our apologies for the omission. The corrected quote is printed above.

Harder Sell in US

Cap and trade legislation has stalled in Congress, in the wake of the massive health care legislation and thus efforts have died this year. However, the fight will continue next year which, given the fact it is an election year, will make it an uphill battle. There is wide recognition that such schemes will have severe economic impacts and job losses at a time when the economy is trying to crawl out of the recession.

"We were previously of the view that cap and trade was becoming an increasingly hard sell in the U.S.," Wood Mackenzie Energy Analyst Paul McConnell told Reuters. "But I think the events in Copenhagen have probably made that even more difficult” because the Copenhagen Accord did set include emissions targets.

IATA outlined the industry efforts at COP 15. “We came to Copenhagen to be part of the deal and we were encouraged by the level of support for the industry’s global sectoral approach and targets,” said Director General Giovanni Bisignani. “We will continue to press states to include these global targets in any future deal. Airlines, airports, air navigation service providers and manufacturers are reinforced in their commitment to improve fuel efficiency by an average of 1.5% per year to 2020, to stabilize carbon emissions from 2020 with carbon-neutral growth, and to a net reduction in carbon emissions of 50% by 2050 compared to 2005.”

Allowing ICAO to set the framework is a hefty task but the goal is now to hammer out the framework for presentation at next year’s Copenhagen climate conference COP 16. “In the meantime, we continue to urge governments to avoid creating a patchwork of national and regional solutions and to ensure aviation’s emissions are dealt with as a sector and across the world,” he said. “A global sectoral approach supported by tough targets is the only sensible way forward for a global industry.”

While the industry works on technological and alternative fuel advances to achieving carbon neutrality after 2020, it is also prepared to achieve that neutrality through offsetting.

Young reported that environmentalists didn’t think the industry’s goals go far enough, wanting hard percentages applied across the board.

“My answer to them is no industry is starting from the same place,” she said, adding that is why the tailored approach is so important. “Since 1978, the U.S. airlines have increased fuel efficiency by 110% which has resulted in 2.7 billion metric tonnes of carbon dioxide (CO2) savings, roughly equivalent to taking 19.5 million cars off the road each year. That’s so much better than the power, cement, and auto industries. For that reason, applying a common target to all industries doesn’t make sense. The industry has already demonstrated it is taking a leadership role. We think there is a reason to tailor the target to the industry. We’ve already convinced a lot of countries on this concept and about the targets themselves. Now we have more education to do to seal the deal.” 

Aviation contributes 2% of carbon emissions compared to the 25% for the rest of the transportation industry in the US, according to ATA which also pointed out that the industry was able to lower fuel consumption and GHGs to the point that, in 2008, it was 5.5% below 2000 levels. During that time it transported 17% more passengers and cargo.

The Association also pointed out that the Federal Aviation Administration reported 90% of the fuel and GHG efficiency improvements have been achieved by continual reinvestment in the latest aircraft and technology upgrades, making the costs associated with an ETS counterproductive. Adding ETS costs to its current tax burden would compound the issue at a time when the industry is not only paying traditional income and payroll taxes but “a patchwork of expanded aviation-specific taxes, including environmental protection, jet fuel, homeland security, overflight, arrival and departure taxes, and other fees subsidizing airports and operations.” Combined taxes and fees siphon USD18 billion from industry coffers every year.

According to IATA estimates, these will cost the world’s airlines approximately USD3.5 billion annually beginning in 2012. USD3.5 billion could, if used more sensibly, go a long way in further increasing fuel efficiency.