13-Oct-2009 1:03 PM

Lufthansa and Air France-KLM looking to limit costs for carbon emission permits

Lufthansa and Air France-KLM are reportedly looking to limit the costs they will have to pay for carbon emission permits under the EU’s climate change programme, to be launched in 2012 (Bloomberg, 12-Oct-2009). Lufthansa reportedly plans to purchase futures contracts to limit costs by EUR250 million p/a. Lufthansa’s emissions are expected to be around 40% higher than the permitted levels, potentially forcing it to spend between EUR200 million and EUR300 million p/a on permits. Meanwhile, Air France plans to use financial contracts to cap permit costs at approximately EUR100 million p/a.