Save the date!

Friday, April 21, 2017

Posted by comms on 04/21 at 06:19 PM

We are co-organisers of the world’s most popular series of aviation sustainability “Aviation Carbon” events. Our next global event will be held in London 4-5 December 2017, venue details to be announced shortly.

Green Aviation non-profit launches!

Thursday, April 20, 2017

Posted by comms on 04/20 at 06:24 PM

Green Aviation International Association is a new pro-aviation organisation made up of aviation and sustainability professionals. We are disappointed with the lack of speedy and effective progress by current industry leaders and we are pushing for a much more ambitious roadmap and actions for aviation sustainability.

For sure, the aviation industry has done much to be proud of, but it’s not enough, especially at a time when scientists are informing us that we are not doing enought to avert the possibility of the worst-case climate scenarios.

We are liaising and working with other NGOs, government departments, subject matter experts, research institutions, aviation industry associations, airlines and other organisations to design and implement a range of new initiatives and standards to significantly improve the sustainability standards and implementation of solutions.

We are developing as a centre of excellence for aviation sustainability standards and professionals across the industry beyond just the 240 IATA members, reaching out to all the 600+ airlines around the world.

Why not join our unique mission? For more information please enter your details on our contact page.

Green Aviation attend IPCC seminar at United Nations

Thursday, June 16, 2016

Posted by comms on 06/16 at 06:33 PM

Green Aviation attended an invitation-only IPCC information session at the United Nations HQ in Geneva on 16 June 2016.
 
A question was put to the IPCC Chair Dr. Hoesung Lee by Andrew Pozniak, Director of Green Aviation International concerning the lack of effective progress by a large part of the aviation sector despite the scientific consensus requiring urgent action.

The seminar was streamed live worldwide and also recorded on the IPCC’s Facebook page, but unfortunately the sound quality is not great. Green Aviation asked their question at 38m 50s into the stream, or if the video clip is showing time remaining then it’s at around the -29.00 minute mark:
IPCC Facebook Video
 
Photos of the session:
IPCC seminar photos



Scientists Discover Best CO2 Reduction "Technology" - Trees!

Tuesday, February 17, 2015

Posted by comms on 02/17 at 03:13 PM

Scientists at the University of Oxford University have concluded research which found that trees are the best “technology” to sequester CO2 from the atmosphere and which could help to reduce the impact of global warming. The researchers looked at various methods of reducing CO2 including capturing CO2 directly from industrial sources such as power stations and factories, extracting CO2 directly from the atmosphere and even adding limestone to the oceans. Of all the methods looked at the most effective were planting trees, or converting wood waste into a material similar to charcoal which could then be incorporated into soil. The university found that utilising such solutions as afforestation were not only low-cost but could draw several years worth of CO2 from the atmosphere. Other solutions are high-cost, require large amounts of energy and face many challenges in their development.
Source: Bloomberg
Oxford University Report: Stranded Carbon Assets and Negative Emissions Technologies, published 3 Feb 2015, Authors: Ben Caldecott, Guy Lomax, Mark Workman

Andrew Pozniak joins Advisory Board of STI

Thursday, December 11, 2014

Posted by comms on 12/11 at 07:28 PM

Andrew Pozniak, the Managing Director of Green Aviation has joined the Advisory Board of Sustainable Travel International (STI), the world’s leading non-profit organization that is harnessing the power of travel and tourism as a force for good. They help communities, businesses and governments build a better future for themselves and their environments through travel and tourism. He looks forward to the great opportunities to help shape the future of sustainable travel. For futher information about STI and their great work please visit their website.

Green Aviation speaking at 'Change Management in Aviation'

Saturday, October 04, 2014

Posted by comms on 10/04 at 07:13 PM

Our Managing Director and Principal Consultant Mr Andrew Pozniak has been invited to join a panel session at the Change Management in Aviation conference to be held in London on 2 December 2014.

This leading conference will examine a) the disconnect between strategic initiatives and their implementation across the business and b) the technologies, processes and solutions that can help reduce this disconnect within a carrier.

For more information visit the conference web site at http://www.flightglobalevents.com/changemanagement2014/agenda

Andrew hopes to meet you there.

Consequences of the announcement for aircraft operators

Monday, December 03, 2012

Posted by Oliver Heaton on 12/03 at 11:26 PM

Because the current EU legislation has not been changed yet and may possibly take 6 months to get approval from the Members of the European Parliament and EU Member States, we suggest that aircraft operators should continue to monitor, report and submit verified reports to their competent authorities as usual, unless clearly advised by their competent authority in writing to the contrary.

Already we have witnessed contradictory statements and official advice from different EU spokespersons, competent authorities and some verifiers. This creates a risk of causing huge confusion and concern with many operators left wondering how they need to manage EU ETS activities and carbon liabilities in the coming 12 months.

Again, we suggest that all operators keep following the existing rules until otherwise advised otherwise by the competent authority in writing. In their financial planning they may wish to still assume, at least for the time being, that they still need to pay for carbon permits for in/ex EU flights for the current year 2012 and beyond.

The upcoming “Aviation Carbon 2013” conference in London on February 19-20 will have EU officials, Competent Authorities, legal experts, carbon strategy experts, speakers from IATA, AACO and IETA aimed at helping you to make sense of the confusion and help you to comply correctly and plan optimally for the future.

EU ‘Stops the Clock’ on EU ETS outside of Europe, confusion reigns

Posted by Oliver Heaton on 12/03 at 11:23 PM

Some of you will have already heard that EU Climate Commissioner Connie Hedegaard announced on Monday 12th November an intention of a 12 month suspension of the EU ETS for flights to and from Europe, however we chose to wait and try to seek further clarity on what this announcement actually means in practice. Unfortunately confusion reigns across the various authorities and so we will try and make as clear assessment as we can for you in the current circumstances.

The ‘Stop the Clock’ proposal was made as a “goodwill gesture” in order to allow ICAO to continue its progress towards a global emissions reduction scheme.  The decision also comes following increased pressure from airlines, aircraft manufacturers and an increasing number of opposing Governments to scrap the scheme.

The EU ETS will continue to apply to intra-EU traffic for both European and non-European operators, so all such operators will still be required to monitor, report and verify their CO2 emissions for all flights within the EU and surrender the required carbon permits by 30 April 2013. However, it is presently unclear whether international flights will need to continue to be monitored and verified, even though the CO2 charges are suspended.

Separately, the vote by the US House of Representatives on Tuesday to allow the Transport Secretary the power to bar US domiciled aircraft operators from participating in the EU ETS, regardless of the concessionary position of the EU complicates the situation further, although this proposal still needs to be put forward to and approved by President Obama.

Hedegaard said that the suspension of the scheme applying to international flights would automatically be lifted in a year’s time if ICAO failed to deliver an agreement on “meaningful international action” over aviation emissions, but without defining what “meaningful”  actually means. The rapidity of the move surprised many and comes after what the EU sees as significant progress at last Friday’s meeting of ICAO’s governing Council, which agreed to set up a High-level group of 15 senior government representatives to provide guidance on policy issues to the expert group currently working on market-based measure options and an implementation framework.

The policy decision will be brought into what is known as a co-decision process. This means the European Parliament and the EU countries will need to agree upon the terms and conditions of Hedegaard’s proposals which are due to be drafted shortly. During the co-decision process the proposal may be amended, halted or complemented with other changes to the EU ETS.  This process may take six months, half-way into the 12 month suspension. 

In the meantime, existing legislation should remain effective, unless officially communicated otherwise by each administering member state. The EU member states are meeting in Brussels this week to discuss the technicalities of the proposal and strive towards enacting a common and united approach.

The EC and the competent authorities are said to be sensitive to the fact that the ‘Stop the Clock’ decision creates an ambiguous signal, which may place aircraft operators in a situation of indecision whether to comply or not to comply, preluding the outcome of the co-decision process and US prohibition legislation. This implies the level playing field may be distorted and all sorts of practical issues are likely to arise.


Clarity is required as to whether or not monitoring, reporting, verification and surrendering of allowances will be required by the Member States for 2012 emissions data, and what will happen with allocated allowances for extra-EU flights. It is unlikely there will be a common approach very soon, but the competent authorities understand the need for clarity and a level playing field.

Upcoming events

Sunday, September 23, 2012

Posted by Oliver Heaton on 09/23 at 10:36 PM

Biofuels 2012, 7th Annual Meeting
17-19 October 2012, Amsterdam, The Netherlands
http://www.wraconferences.com/biofuels

Aviation Carbon 2013
19-20 February 2013, London Heathrow Marriot
Details Coming Soon!

 

Switzerland shelves aviation ETS

Posted by Oliver Heaton on 09/23 at 10:35 PM

The Swiss government has made a U-turn on its decision introduce an aviation ETS by January 2013.  The Swiss scheme was largely based on the EU ETS and would at some point have been linked to the European system.

The Swiss have decided to ‘wait and see’ how the EU ETS performs and what progress is made by ICAO on a global aviation emissions reduction scheme within the next 12 months.

Washington meetings reaffirm opposition to EU ETS

Posted by Oliver Heaton on 09/23 at 10:34 PM

The 17 countries attending a meeting held in Washington early last month have reaffirmed their opposition to the application of the EU ETS to non-EU carriers and say they remain committed to the actions to reduce international aviation emissions agreed in the ICAO Assembly Resolution A37-19 of 2010.

Meanwhile, the US airline trade organisation Airlines for America repeated its call, a move supported by some US politicians, for the United States government to file an Article 84 Chicago Convention complaint at ICAO against Europe over its emissions trading scheme. However, the official said no decision by the Administration had been taken. “An Article 84 is not off the table – we don’t have any immediate plans to do that, but it is always an option.”

At the same time the 17 nations were meeting in Washington, a U.S. Senate committee passed a bill authorizing the transportation secretary to bar U.S. airlines from complying with a European Union law that would require them to pay for carbon emissions on flights to and from Europe.  The measure approved by the Senate Commerce Committee will be sent to the full Senate for a vote.



The 19-member panel voted to approve an updated version of a bipartisan bill authored by Republican Senator John Thune and Democratic Senator Claire McCaskill.  Democratic Senator Barbara Boxer, a long-time advocate of mandatory curbs on carbon emissions and author of several cap-and-trade bills, said she and fellow Democratic Senator John Kerry would back the measure after Thune included compromise language.



The Thune-McCaskill bill directs the secretary of transportation to prohibit U.S. airlines from participating in the EU trading scheme to curb carbon emissions if he or she deems it in the public interest.

ICAO aircraft emissions metrics claimed ‘not fit for purpose’

Posted by Oliver Heaton on 09/23 at 10:33 PM

ICAO’s environment committee CAEP has agreed a metric system that will be used to define a global CO2 standard for new commercial aircraft. Agreement on a common metric for measuring the CO2 emissions of new aircraft has been welcomed by the aircraft manufacturers as well as airline associations and non-governmental organisations. However, the metric has attracted criticism from certain quarters.  It has been accused of being politically expedient and lacking in transparency.

Dimitri Simos of UK company Lissys, which created the Piano aircraft analysis software that is used to quantify CO2 emissions in two out of the four greenhouse gas aviation models approved by ICAO.


In a nine-page open letter disseminated before the CAEP agreement, Simos described the metric as fundamentally flawed, unfit for purpose and a deeply wrong decision. “The makeshift proposal devised by ICAO is an unsafe public placebo that utterly fails in its purported intent. Different aircraft emit CO2 differently in transporting specific payloads over specific ranges. ICAO’s CO2 metric is unable to reflect this fact – it measures nothing real and can offer nothing real.”

EU ministers call for aviation EU ETS compromise

Posted by Oliver Heaton on 09/23 at 10:32 PM

Four European trade ministers representing Airbus manufacturing States endorsed the EU’s position that ICAO should implement a global aviation emissions reduction scheme to replace the EU ETS.  However two of the junior ministers from the UK and Germany appeared to break ranks with official EU and their national policies by calling for aviation to be immediately suspended from the EU ETS prior to the implementation of a global scheme.  The trade ministers met with Airbus management at the Berlin air show.  Their statement resulted from the perceived threat of retaliatory action from China against its inclusion in the EU ETS. 


Whilst the EU agrees that an ICAO scheme should replace the EU ETS, it is concerned that any global initiative is unlikely to be implemented before 2020 and that ICAO will have difficulty obtaining consensus amongst its 191 members.  The EU also has reservations concerning self-regulation and legally enforceability.

Airbus chief executive Fabrice Bregier said China is withholding signing 35 to 45 orders for wide-body A330 planes as it awaits a signal from the EU that plans to include global airlines in the emissions trading scheme will be suspended.



Airbus sales chief John Leahy, who recently visited China along with Angela Merkel to sign a USD3.5m deal for 50 A320 narrow-body aircraft deal, said China was “adamantly refusing” to discuss wide-body purchases in the absence of signs from Europe that it would step down from implementing the EU ETS.  Leahy suggested that one possible solution could be that all airlines around the world pay a tax to ICAO for carbon emissions, regardless of where they are based.  Any such proposal is likely to be dismissed by airlines and developing nations.


The Chinese action does not affect the recent A320 aircraft order.  Those aircraft will mostly be assembled in China and operated on domestic and regional networks in Asia.

COMMENTARY - Why the EU is unlikely to give ground on aviation EU ETS

Posted by Oliver Heaton on 09/23 at 10:29 PM

Nine months have elapsed since the aviation sector went “live” in the EU ETS.  Most airlines appear to have met their initial compliance obligations and submitted a Monitoring and Reporting Plan and Emissions Reports for 2010 and 2011. Even most airlines domiciled in countries that are opposed to inclusion in the EU ETS seem to be currently compliant and entitled to receive free EU aviation emissions allowances (EUAAs), with a few exceptions. 


Across the press, it appears that the EU ETS is besieged.  Opposition including Sovereign States, airlines and aircraft OEMs either perceive that the EU ETS is an infringement of their national sovereignty, fear the scheme will affect their trading activities or believe that the scheme is simply designed to create tax revenues for impoverished European treasuries.  Will the EU cave in?

The proponents of EU ETS counter the many attacks by pointing out that the aviation industry was allocated around 80 percent of aviation allowances free of charge and which arguably mitigates the rationale behind extra-territoriality. Another viewpoint is that the EU ETS is not a tax but a “market based measure” that allows large carbon emitters the opportunity to source emissions allowances from the lowest cost provider, including a limited amount of Kyoto credits (CERs) and which currently trade at a quarter of the price of EU allowances (EUAs).

  There is a justifiable concern that revenues raised from national allowance auctions may end up wasted in government coffers rather than being ring-fenced for environmental or aviation-specific improvements; however, bringing aviation into the scheme will not raise huge revenues for finance ministries or those financial institutions that trade carbon credits compared with the bulk of their current revenues from the 12,000 fixed installations in the EU ETS since 2005, and much less than collected via aviation departure and similar taxes.

Whatever we in the aviation sector feel about the rights or wrongs of the EU ETS, it is by far the largest carbon trading market in the world and carbon is one of the most widely traded commodities.  Many economists and EU policy makers believe that a low carbon economy is a significant potential job creator and is not a job destroyer as some aviation lobbyists have argued.  We also appear to have passed the point of “peak oil” reserves and so sooner rather than later oil will run out and we’ll need to find alternatives. Even some oil-rich economies in the Middle East have long recognised this stark fact and have diversified accordingly, even looking at alternative fuel production.


When airlines first started to budget for inclusion within the EU ETS, EUAs were trading at over €25. They are presently trading at less than €8 with CERs less than €2. Aviation CO2 emissions are projected to increase from the current annual level of two to three percent of all man-made carbon emission to around 15 percent by 2050. It is therefore difficult for our aviation industry to continue to argue that we deserve exemption on the basis that it is international and is also suffering from current financial woes – because all carbon emissions from whatever source are international and take no account of national boundaries.

Those that seek exemption or suspension of aviation from the EU ETS are perhaps, arguably, missing a big point.  All parties, including even the EU, agree that ICAO should remain the body that oversees the development of a global scheme – but unfortunately ICAO has sat on its hands for 15 years and it may take at least another five to ten years before it has a scheme in place.  Therefore the EU felt compelled to do something. They also often overlook that EU ETS is no longer a plan or proposal, it is in fact live and legally binding and not an arbitrary system that can be opted out of, being incorporated into the national laws of at least 27 Sovereign States. 
Last year the highest court in the EU ruled that the EU ETS was fully compliant with international law. The EU is really unlikely to make any concessions for the airlines because if they did the whole scheme could unwind as other sectors claim that they are “special cases” as well.


The EU ETS has faults for sure, and we have experienced many of them working on behalf of airlines and operators. It’s implementation for the aviation sector was far from ideal and painful to say the least.  But it’s also perhaps worth remembering the words of ELFAA who represent the most successful low cost carriers in Europe such as Ryanair and Easyjet who said last December -


“ELFAA again urges its colleagues in the industry to halt their resistance and lend their constructive support to the implementation of EU ETS from 01 January. The European Commission has rightly preferred EU ETS over all other options, including taxation, and views it as the MBM (market based measure) which will achieve the greatest environmental benefit at the lowest cost to society.”
“With its inclusion in the EU ETS, aviation will more than cover its environmental costs. Government policy should recognise this and stop the spread of taxation of aviation, by cash-strapped governments, under the guise of environmental measures”, said ELFAA Secretary General John Hanlon.

(Note: ELFAA represents the fastest-growing European airline sector. Its members carry over 180 million passengers a year and account for over 43% of scheduled intra-European traffic. ELFAA comprises 9 airline members which include: easyJet, Flybe, Jet2.com, Norwegian, Ryanair, SverigeFlyg, Transavia.com, Vueling and Wizz Air).

Switzerland aviation sector ETS still on track?

Wednesday, September 12, 2012

Posted by Oliver Heaton on 09/12 at 08:29 PM

Last month we reported that Switzerland is to demand all aircraft operators, domestic and international, serving its airports to record tonne-kilometre (TK) data from 1 January 2013, with the submission of monitoring plans for approval required by 30 September 2012. The move follows discussions between the European Union and Switzerland on linking the EU ETS and the Swiss ETS from 2014, with the EU insisting that Switzerland includes civil aviation emissions as well as those from stationary installations in the Swiss scheme. A few days ago we contacted the Swiss authorities to get an update on the results of their consultation process and whether they 30 September still remains the due date. We received this response –
“The consultation process for the draft ordinance for TKM data collection is completed - the report on the results of the consultation will soon be published. The stakeholders will soon be informed if data collection will be realized in 2013 or postponed to a later date; the information letter will normally be sent by mid August”.
We find it interesting to read the reference to “if data collection will be realized in 2013 or postponed to a later date” – does it suggest there may be some delay? Whatever the outcome we will let you know.

Carbon allowance VAT fraudsters jailed up to 15 Years

Thursday, September 06, 2012

Posted by Oliver Heaton on 09/06 at 08:15 PM

UK based criminals who attempted to defraud £38 million (€47 million, $60 million) from the UK public purse were sentenced to jail for between 9 and 15 years. The crooks established a number of false companies to trade EU ETS allowances fraudulently over a 6 month period in 2009 and in such a way to avoid paying value added tax. There have been several similar frauds and as a consequence the rules on VAT relating to carbon allowances were changed last year to avoid this particular scam from occurring again.

Switzerland planning aviation sector ETS and linked to EU

Posted by Oliver Heaton on 09/06 at 08:13 PM

(GreenAir) - Switzerland is to demand all aircraft operators, domestic and international, serving its airports to record tonne-kilometre (TK) data from 1 January 2013, with the submission of monitoring plans for approval required by the end of this September. The move follows ongoing discussions between the European Union and Switzerland on linking the EU ETS and the Swiss ETS from 2014, with the EU insisting that Switzerland includes civil aviation emissions as well as those from stationary installations in the Swiss scheme. In anticipation that the negotiations prove successful, all aircraft operators operating to and from Swiss airports above the de minimis set under the EU ETS aviation directive will be required to join the Swiss ETS from 2014. Most airlines likely to be impacted will be already monitoring and reporting the data to their relevant EU authority, airlines from countries already in dispute with the EU over its unilateral scheme will be faced with another dilemma as non-compliance carries potential Swiss fines.


The current Swiss ETS constitutes a voluntary alternative to a domestic fuel tax but the non-EU country is seeking a more ambitious emissions reduction scheme that links to a common European carbon market with more environmental and economic benefits. Negotiations between the European Commission and Switzerland formally started in March 2011, which is the first time the EU has discussed linking its ETS with the emissions trading system of a third country. The prior acquisition of TK data by aircraft operators is a pre-requisite for the conclusion of an agreement.

 




Reproduced with permission, full article at http://bit.ly/Mkjs5E

SAA agrees "under protest" to EU ETS

Posted by Oliver Heaton on 09/06 at 08:13 PM

Following the recent announcement that Russia was going to step back from active involvement in the objections to the inclusion of aviation in the EU ETS, now another country in the “Coalition of the Unwilling” is letting its airlines comply. The state owned SAA (South African Airways) is going to continue to participate “under protest” in a similar way to many other IATA member airlines. It will also charge a carbon levy of between 1 and 2 Euros per passenger on EU flights effective 1 July 2012. The carbon levy has been disguised as an increase in the fuel surcharge.

ICAO may have aviation emissions plan ready March 2013

Posted by Oliver Heaton on 09/06 at 08:10 PM

Secretary General Raymond Benjamin who is the head of ICAO says that he expects there to be a draft proposal concerning measures to deal with aviation emissions on a global level by March 2013. This is approximately three months later than his previously announced deadline of December 2012. He said last week that “I believe that the turning point will be in March next year when we will put one option on the table if all goes well. It depends on the member states.”

ICAO is currently working on four options for a single, global market-based measure for international aviation. These are:
-  Mandatory offsetting scheme
-  Mandatory offsetting scheme plus additional revenue-
  raising
-  Emissions trading scheme
-  “Baseline & Credit” scheme based on efficiency


These options are being developed for review by the Council of ICAO, with a view to them agreeing one of the options.  Given the objection to carbon emissions schemes by at least the US and China on the basis that an aviation scheme could set a precedent for other carbon schemes affecting other industries, we feel that it could be highly questionable as to whether these countries, and perhaps a few others, would even agree to an ICAO scheme for aviation emissions, at least without significant dilution compared to the EU ETS requirements. Since 191 countries need to agree upon a common approach at ICAO we also feel that an agreement is unlikely by March 2013 and more likely not until at least October 2013 at the ICAO Assembly.

Carbon allowance VAT fraudsters jailed up to 15 Years

Thursday, June 28, 2012

Posted by Oliver Heaton on 06/28 at 09:57 PM

UK based criminals who attempted to defraud £38 million (€47 million, $60 million) from the UK public purse were sentenced to jail for between 9 and 15 years. The crooks established a number of false companies to trade EU ETS allowances fraudulently over a 6 month period in 2009 and in such a way to avoid paying value added tax. There have been several similar frauds and as a consequence the rules on VAT relating to carbon allowances were changed last year to avoid this particular scam from occurring again.

Switzerland planning aviation sector ETS and linked to EU

Posted by Oliver Heaton on 06/28 at 09:55 PM

(GreenAir) - Switzerland is to demand all aircraft operators, domestic and international, serving its airports to record tonne-kilometre (TK) data from 1 January 2013, with the submission of monitoring plans for approval required by the end of this September. The move follows ongoing discussions between the European Union and Switzerland on linking the EU ETS and the Swiss ETS from 2014, with the EU insisting that Switzerland includes civil aviation emissions as well as those from stationary installations in the Swiss scheme. In anticipation that the negotiations prove successful, all aircraft operators operating to and from Swiss airports above the de minimis set under the EU ETS aviation directive will be required to join the Swiss ETS from 2014. Most airlines likely to be impacted will be already monitoring and reporting the data to their relevant EU authority, airlines from countries already in dispute with the EU over its unilateral scheme will be faced with another dilemma as non-compliance carries potential Swiss fines.

The current Swiss ETS constitutes a voluntary alternative to a domestic fuel tax but the non-EU country is seeking a more ambitious emissions reduction scheme that links to a common European carbon market with more environmental and economic benefits. Negotiations between the European Commission and Switzerland formally started in March 2011, which is the first time the EU has discussed linking its ETS with the emissions trading system of a third country. The prior acquisition of TK data by aircraft operators is a pre-requisite for the conclusion of an agreement.

Reproduced with permission, full article at http://bit.ly/Mkjs5E

SAA agrees "under protest" to EU ETS

Posted by Oliver Heaton on 06/28 at 09:53 PM

Following the recent announcement that Russia was going to step back from active involvement in the objections to the inclusion of aviation in the EU ETS, now another country in the “Coalition of the Unwilling” is letting its airlines comply. The state owned SAA (South African Airways) is going to continue to participate “under protest” in a similar way to many other IATA member airlines. It will also charge a carbon levy of between 1 and 2 Euros per passenger on EU flights effective 1 July 2012. The carbon levy has been disguised as an increase in the fuel surcharge.

ICAO may have aviation emissions plan ready March 2013

Posted by Oliver Heaton on 06/28 at 09:50 PM

Secretary General Raymond Benjamin who is the head of ICAO says that he expects there to be a draft proposal concerning measures to deal with aviation emissions on a global level by March 2013. This is approximately three months later than his previously announced deadline of December 2012. He said last week that “I believe that the turning point will be in March next year when we will put one option on the table if all goes well. It depends on the member states.”

ICAO is currently working on four options for a single, global market-based measure for international aviation. These are:
-  Mandatory offsetting scheme
-  Mandatory offsetting scheme plus additional revenue-
  raising
-  Emissions trading scheme
-  “Baseline & Credit” scheme based on efficiency


These options are being developed for review by the Council of ICAO, with a view to them agreeing one of the options.  Given the objection to carbon emissions schemes by at least the US and China on the basis that an aviation scheme could set a precedent for other carbon schemes affecting other industries, we feel that it could be highly questionable as to whether these countries, and perhaps a few others, would even agree to an ICAO scheme for aviation emissions, at least without significant dilution compared to the EU ETS requirements. Since 191 countries need to agree upon a common approach at ICAO we also feel that an agreement is unlikely by March 2013 and more likely not until at least October 2013 at the ICAO Assembly.

IATA Urges ICAO Solution to Emissions Trading

Tuesday, June 26, 2012

Posted by Oliver Heaton on 06/26 at 11:15 PM

IATA has reiterated its call for a comprehensive global solution on aviation emissions via ICAO according to a press release today from its AGM in Beijing.  “To meet our ambitious targets we will need a globally-agreed approach covering the areas of technology, operations, and infrastructure as well as positive market-based measures. Everyone, including Europe, agrees that the solution must be a global agreement through ICAO at the 2013 Assembly. But Europe’s unilateral and extra-territorial inclusion of international aviation in its emissions trading scheme from 2012 is creating discord when we need harmony,” said Tony Tyler, IATA’s Director General and CEO.

ICAO is currently working on four options for a single, global market-based measure for international aviation. These are:

- Mandatory offsetting scheme
- Mandatory offsetting scheme plus additional revenue-raising
- Emissions trading scheme
- “Baseline & Credit” scheme based on efficiency

These options are being developed for review by the Council of ICAO with a view to agreeing to one of the options at the next ICAO Assembly of member states in the autumn of 2013.

What should aircraft operators do with all this political noise?

We recommend they have no real option but to focus on the facts which are that the EU ETS regulations are in place already and they need to be complied with to avoid the risk of large penalties.

Chinese airlines expect government support on ETS

Posted by Oliver Heaton on 06/26 at 11:14 PM

Following on from the preceding article there is further confirmation that different sources in China are sending out different messages concerning the threat of Chinese retaliation against the EU ETS. We sense that the government is seeking to avoid conflicts and negotiate with the EU on agreeing equivalent measures as it introduces its own departure taxes and plans an ETS for industry, whilst on the other side some sources in the Chinese aviation industry are keen to put out a different message.

Coinciding with the IATA AGM in Beijing the Secretary General, Wei Zhenzhong, of the Chinese Air Transport Association said yesterday in an interview with Bloomberg that he “expects that the Chinese government will impose similar penalties on European airlines swiftly after any EU action”.

Meanwhile the EU stance remains firm and Bloomberg also reported that Isaac Valero-Ladron, the climate spokesperson for the European Commission replied that “All this retaliation talk isn’t in anyone’s interest. It would be much wiser to spend all this energy to get a global deal in ICAO.”

US politicians continue pressure against the EU ETS

Posted by Oliver Heaton on 06/26 at 11:12 PM

There seems to be no sign of US objections to the EU ETS abating despite the fact that the scheme is already live and with most US carriers adding an “ETS levy” of around $3 onto EU flights to cover their costs of EU ETS compliance.  Last week there was a display of bipartisanship on the issue as the members of the Commerce Committee and the Obama administration’s Transport Secretary LaHood criticising the implementation of the EU ETS.

The Committee’s chairman Jay Rockefeller, a Democrat, noted that “The European Union acted because it believes it needed to make a bold effort to reduce greenhouse gas emissions and I understand why they did so. But, I believe that their unilateral action is likely not sustainable by international law. I support the goals, but I have to oppose the action.”

The Committee’s top Republican Kay Bailey-Hutchison said that “The European Union, with this emissions trading scheme, is acting outside of their prerogative and most certainly will have a negative effect on our aviation community. The EU needs to step back.”

Transportation Secretary Ray LaHood said “We need to see real signs of flexibility from the EU.” The Obama administration has threatened unspecified action if a compromise is not reached, but LaHood did not give any further details, however discussions appear to be focusing upon the filing of formal complaints at the UN.

As we suggested in the last edition of “Aviation Emissions News” concerning the Indian government’s objections to EU ETS and their Civil Aviation Minister’s comment that “If you allow this (EU ETS), next they will impose a carbon tax on shipping or cement”, confirms that the real objections to the EU ETS are mainly about the EU setting a global precedent on carbon charges. Similarly in the US, they are concerned that the EU ETS can be a precedent for future unilateral measures on such environmental matters.

Therefore, in our opinion, routing the aviation emissions trading scheme through ICAO will not result in a global agreement any time soon, if ever, since the US and Indian governments and others have expressed such vociferous opposition to setting precedents for carbon emissions charges.

Given this situation, and considering that 15 years have already passed since ICAO was charged with finding a global solution to aviation emissions, it is very unlikely that the EU will seek to reverse their ETS legislation already implemented in 27+ countries. We also think they are unlikely to scale back the scheme’s applicability for aviation other than agreeing some “equivalent measures” and which if agreed would only impact the inbound EU flights.

Meanwhile, it is interesting to note that China is planning a domestic ETS for their industries and a departure tax for aviation as a mechanism to manage aviation emissions and which the EU are assessing in respect of any potential “equivalence” to their ETS.

Airline EU ETS revenues may support developing nations

Monday, June 04, 2012

Posted by Oliver Heaton on 06/04 at 07:51 PM

The EU’s Climate Commissioner Connie Hedegaard said at the recent Global Energy and Environment Summit that the “modest revenues” raised from the aviation sector’s participation in the in the EU ETS should be directed into climate financing to help poorer countries deal with global warming, as opposed to the current practice of all EU members except Germany who plough revenues raised from carbon permit auctions into general expenditures.

Hedegaard’s proposal is in order to try and deflect some of the international criticism being directed at the EU ETS, especially criticisms from some opponents that the principle of EU ETS is not fully environmental due to the funds raised from auctions not being ring-fenced for environmental improvement projects. The EU have tended to rebut such criticisms by highlighting the fact that the scheme places a cap on emissions, and a price on carbon, which in themselves are a major environment improvement and superior to any other initiative in the world. Hedegaard further added that, “Some thought we were just taking this money and saying it was a tax”. “Financial ministers have started this discussion by saying it could go into this, but through national budgets.”

India Potential Ban on EU Airlines

Posted by Oliver Heaton on 06/04 at 07:50 PM

EU aircraft operators may face an embargo flying to India in the event that the EU penalises Indian operators from not complying with the EU ETS. India’s minister of Civil Aviation Ajit Singh has hinted of a potential ban on EU carriers in an interview with the Financial Times. Singh stated that no one will benefit from sanctions and that they will impact their respective weakening economies. 

Singh pointed out that “Travelling is always a two-way traffic. If they can impose sanctions so can other countries. A trade war is not in anyone’s interest and I think reason should prevail ultimately. The EU is a sovereign union, they can make laws for themselves, but they cannot make laws for the whole world. If you allow this, next they will impose a carbon tax on shipping or cement”.

And therein seems to lay the real objection to EU ETS in our view. Although not welcome, it’s not really about a $3 ETS charge on a long haul sector which is relatively small in comparison to the much larger swings in kerosene prices and escalating departure taxes. The crux seems to be more about preventing the EU from setting a precedence in charging for carbon emissions on other more polluting industries and introducing carbon import tariffs on a nation’s products imported to the EU. Whatever happens it looks like it is going to be a bumpy ride and operators need to plan their carbon strategies smartly.

Korea passes ETS legislation

Posted by Oliver Heaton on 06/04 at 07:49 PM

South Korea which is the world’s 15th biggest economy has recently passed legislation for a national ETS which will start in 2015.

It will initially be for fixed installations emitting at least 25,000 tonnes of CO2 annually and there is no present scope to include the aviation sector.

The South Korean ETS is part of the country’s “Green Growth” agenda which has so far seen over $83 billion allocated to initiatives to drive investment in clean technologies.
It is the latest country in an increasing number of national ETS’ announced in recent months and last year and it signals the rise of both taxation and cap and trade schemes which control emissions and charge industries for exceeding defined limits. In February 2012 South Africa announced a new carbon tax as from 2013. In March a voluntary ETS was approved in Mexico. In April a carbon tax was approved in Italy. We have previously reported on China developing a domestic trading scheme and it seems almost inevitable there may be further schemes elsewhere.

Russia to Stay Out of EU-Airline CO2 Dispute

Posted by Oliver Heaton on 06/04 at 07:48 PM

According the Russian journal Kommersant, Russia’s government appears likely to retreat to the sidelines in the EU ETS dispute after so far playing an active role in the “Coalition of the Unwilling” comprising of more than 20 non-EU nations. Their source was an unnamed official. The Russian’s may now just act as observers instead of getting directly involved as the other nations and their airlines continue to oppose the inclusion of aviation in the EU ETS.

Chinese and Indian Airlines given mid-June reporting deadline

Posted by Oliver Heaton on 06/04 at 07:46 PM

Eight Chinese and two Indian carriers have failed to submit their verified EU ETS emissions reports for 2011 by the 30 April 2012 deadline.

The carriers represent approximately 3% of the airline industry’s EU ETS emissions according to the EU’s Climate Commissioner Connie Hedegaard. She said that the airlines have until mid-June to submit the data.

What happens after that date is anyone’s guess, but it is thought by some analysts to be unlikely that significant penalties will be enforced since there are no ETS permits required to be submitted until the same time next year. However, we feel that this non-compliance may potentially result in the freezing of the free carbon allowances for these carriers as they will have not complied with the rules, and therefore will be considered to be at very significant risk of not complying again in the future.

EasyJet completes 2012 CO2 purchase for £7 million

Monday, May 21, 2012

Posted by Oliver Heaton on 05/21 at 11:31 AM

EasyJet has bought all the carbon credits it needs to fulfil its 2012 EU ETS compliance obligations at a cost of £7 million (€8.68 million).  EasyJet has officially reported that its fleet emitted 4,438,790 tonnes of CO2 in 2010, which represents the total number of emissions allowances required to fulfil its 2012 mandatory trading obligations. The UK low cost carrier has been allocated 3,697,330 free EU aviation emissions allowances (EUAAs) by the UK government for 2012, representing 83% of the allowances it needs to surrender prior to the first annual compliance date of 30 April 2013.

EasyJet is therefore obliged to purchase additional allowances to cover its shortfall of 741,460 tonnes of CO2.  The spot market for EUAs, which are expected to trade at least 50 cents higher than EUAAs, has been floating at sub EUR7.00 and therefore the cost of compliance for EasyJet should be in the region of £4.1 million (€5 million). The carrier’s compliance cost would be even less if it were to use its full entitlement to surrender up to 15% of its 2012 emissions obligations by using CERs. This would bring its 2012 emissions cost down to around £2.4 million (€3 million). 

ICAO global ETS unlikely before 2020 says US official

Posted by Oliver Heaton on 05/21 at 11:30 AM

Duane Woerth, United States permanent representative and ambassador to ICAO believes it is unlikely that a global aviation ETS will be in place before 2020. That consensus, although not unanimous, is widely accepted, he said. Woerth was critical of the slow progress at ICAO to deliver on a CO2 standard for airframes and engines that is due to be produced in 2013, which was, in his opinion, being held up by a failure to agree on variables and metrics.

The recent formation by the ICAO Council President, Robert Kobeh González, of an Ad-hoc Working Group to study market based measures options and report this June and November “sounds awfully similar to the work ICAO has already done between 2007 and 2010,” Woerth said, speaking at a recent US Chamber of Commerce aviation conference in Washington, Ambassador Woerth and where he concluded: “So what will the 2013 ICAO Assembly produce – a different consensus? I guess we’re all going to have wait and see.”

The UK Government is proposing to change the way it administers EU ETS regulations. Whilst the €100 per tonne EU statutory civi

Posted by Oliver Heaton on 05/21 at 11:28 AM

The UK Government is proposing to change the way it administers EU ETS regulations.  Whilst the €100 per tonne EU statutory civil penalty will remain unchanged for late surrender of allowances, the UK Environment Agency aims to simplify its current domestic penalties regime and amend the appeals system in England and Wales, where it has discretion.

The proposal also plans to dispense with criminal charges, replacing them with more flexible civil penalties.  This new policy is partly an attempt to encourage compliance as a large number of aircraft operators, particularly non-UK small emitters have so far failed to comply with the EU ETS. A public consultation period is to run until 31 July 2012 and a final decision concerning amendment of the UK GHG Regulations will be announced in November 2012.  Any amendments to the UK GHG Regulations will take effect from 1 January 2013.

The consultation does not seek views on the provisions pertaining to aircraft operators where there is no material change in the draft 2012 GHG Regulations compared to the 2010 Aviation Regulations. 

The proposal has also been introduced as part of a wider effort to reduce UK government ‘red tape’, duplication and increase harmonisation between the GHG regulations for aviation and fixed installation emitters.  It is currently unclear whether the €100 per tonne civil penalty will remain a once only fine for aviation or will become annually re-occurring in the event of continuing default, as is the case for statutory installations.  It seems probable, but far from certain that the €100 per tonne penalty will remain a once only charge for all UK regulated aircraft operators.
The consultation document also refers to a small emitters opt out provision but this is somewhat unclear as the document states that the 2010 Aviation Regulations will largely remain unchanged.  It would appear on first view that the UK authorities may have failed to adequately differentiate between fixed installation ‘small emitters’ and aviation ‘small emitters’.

The proposal also includes an update on general provisions for monitoring, reporting and verification of aircraft operators to reflect the new EU Monitoring and Reporting Regulations (MRR) and accreditation and verification Regulations.

http://bit.ly/LKt2vq “>Link - http://bit.ly/LKt2vq

EU will assess Chinese aviation tax as “equivalent measure”

Wednesday, May 09, 2012

Posted by Oliver Heaton on 05/09 at 11:10 PM

The European Union has indicated that it will be seeking more information concerning the recent statement from China’s Ministry of Finance concerning their introduction of an aviation surcharge and will consider whether it can qualify as a partial exemption under EU ETS rules. The EU ETS legislation already includes the possibility of a complete exemption of ETS charges for flights incoming to the EU if a non-EU nation implements “equivalent measures” to reduce carbon emissions from aviation.

EU Climate Commissioner Connie Hedegaard said “We have asked our delegation in Beijing to try to look a bit into what does it mean.” “What interests me is if that’s something that could be seen as an equivalent measure. In order to judge this we need more information about what it is.”

China’s Finance Ministry said last month that it will soon introduce a charge of RMB 20, approximately USD 3, and that the revenue may be earmarked for emission-reduction efforts.

The EU has repeatedly said that equivalent measures are the only option for countries outside the region to reduce the impact of the EU ETS.

Major institutional investors urge EU to improve EU ETS

Posted by Oliver Heaton on 05/09 at 11:09 PM

The Institutional Investors Group on Climate Change (IIGCC) has called on EU states to raise carbon prices by reducing the supply of carbon allowances. The IIGCC members have EUR 7.5 trillion in total assets under management and urged EU nations to support the price of allowances after they reached record lows in April. IIGCC Executive Director Stephanie Pfeifer said “At under seven Euros per tonne, the carbon price is not even high enough to support a switch from coal to gas!”

US cautions over EU ETS

Posted by Oliver Heaton on 05/09 at 11:08 PM

Todd Stern, who is the US special envoy for climate change has cautioned that the disagreement over the EU ETS charging non-EU airlines for their emissions could potentially hold up global climate change talks. According to a report in the Financial Times he said after a recent meeting of climate representatives in Rome, “It could hold them up or have a spill over effect. He pointed out that the issue was mentioned several times at the meeting in a “uniformly negative” manner.

In addition to the US, more than 20 other countries including China, Russia and India and collectively referred to informally as the “coalition of the unwilling” have continued to oppose the EU’s decision to bring airlines in their emissions trading scheme and some have threatened retaliatory trade measures. However, not only US carriers, but also the Chinese authorities have added flight surcharges or departure taxes on EU flights at around the level of USD 3 per passenger per EU sector and which is a very rough approximation of the current cost of carbon on EU sectors from these countries.

Stern is the first US climate negotiator to indicate that the disagreement over EU ETS might potentially affect international talks on reducing greenhouse gases.


The EU’s climate commissioner, Connie Hedegaard, who represented the EU at the Rome meeting, has consistently said that the EU will not reverse its decision citing that the scheme is already law in the 27 EU countries and that the most senior court in the EU has ruled the scheme compatible with international law and open sky agreements. She has also highlighted that EU position was necessary due to slow progress at ICAO on reaching a comparable international agreement. Stern was reported by the FT that the countries opposing EU ETS feel that despite progress at ICAO proving to be difficult it did not necessarily mean that a multilateral approach should be disregarded. 

Qantas announces sustainable aviation fuel feasibility study

Friday, April 20, 2012

Posted by Oliver Heaton on 04/20 at 01:19 PM

Qantas has announced that it will conduct a feasibility study into the potential for an Australian sustainable aviation fuel industry, backed by funding from the Australian Government. The Hon Martin Ferguson MP, Minister for Resources, Energy and Tourism, announced the government’s support for the study ahead of Australia’s first flight powered by sustainable aviation fuel, operated by Qantas from Sydney to Adelaide using a fuel type derived from recycled cooking oil. Qantas CEO Alan Joyce said the project would explore the conditions needed for the production of aviation biofuel from sustainable sources within Australia.

“Australia has the skills, resources and infrastructure to take a lead in this emerging sector, estimated could generate up to 12,000 jobs over the next 20 years. But there are also significant challenges – which is why we need to establish a clear plan. “Until sustainable aviation fuel is produced commercially at a price competitive with conventional jet fuel, we will not be able to realise its true benefits. This study aims to tell us how that can be achieved in Australia.”
Supplied by SkyNRG, the fuel type is a 50:50 blend of biofuel and conventional jet fuel certified for use in commercial aviation. Its ‘life cycle’ carbon footprint is around 60 per cent smaller than that of conventional jet fuel. Government funding for the study will be allocated under the Emerging Renewables Program, while Shell will provide technical support. The study will commence in May.

EUAA price gap versus EUAs widens

Posted by Oliver Heaton on 04/20 at 01:19 PM

Prices of EUAAs which can only be submitted by aircraft operators have dropped further in relation to the more common EUAs in recent weeks. This means that compliance costs for airlines could be even lower than expected. Airlines can also utilise even cheaper CERs.
According to Vertis Environmental Finance the gap between EUAAs and EUAs is currently around 50c.

EU ETS compatible with WTO

Posted by Oliver Heaton on 04/20 at 01:18 PM

(Source, Bloomberg)  http://bit.ly/IUnCyc
The EU’s ETS is compatible with World Trade Organization rules according to a study by University of Cambridge researcher Lorand Bartels, a senior lecturer in WTO and international law. “It’s a bit messy, but I think at the end of the day it’s justifiable,” he said in a phone interview with Bloomberg. “On most points it’s OK in that it’s justified on environmental grounds.” While extending the ETS to aviation might potentially violate WTO rules the WTO actually permits measures that are necessary “to protect human, animal or plant life or health.” A successful WTO complaint needs to demonstrate that the EU could have achieved the same goal using another means that is “both reasonably available and less trade-restrictive than the measure adopted. This is notoriously difficult to assess in the abstract,” Bartels wrote.

Qatar Airways criticise EU ETS

Posted by Oliver Heaton on 04/20 at 01:17 PM

Qatar Airways CEO Akbar al-Baker has criticised the EU ETS as “a cover up for the inefficiencies of the European Union in the management of their finances.” He made the comments during an aerospace conference in Abu Dhabi on Monday 16th. Al-Baker said that fees raised through the ETS will especially penalise the rapidly growing Middle East airlines since they are expected to add hundreds of new planes to their fleets in the coming years.

China increases aviation tax to cut emissions

Posted by Oliver Heaton on 04/20 at 01:16 PM

According to Reuters, China has today announced an RMB 20 ($3.18) charge on passengers on international flights. The revenues raised will go towards a number of initiatives, including reducing greenhouse gas emissions from the aviation sector. The move could impact the inclusion of Chinese airlines in the EU Emissions Trading Scheme. The Ministry of Finance said on its website it has raised the standard charge for passengers on international flights by China-registered airlines to 90 RMB from 70 RMB. At this moment it is not clear as to whether this charge extends to non-Chinese carriers, and if all international routes are included or not.

The EU have consistently said they can consider excluding airlines from countries that take comparable measures to cut emissions.

EU should cut carbon by 50% by 2030

Friday, April 06, 2012

Posted by Oliver Heaton on 04/06 at 05:24 PM

According to the Chairman of German utility company EON AG the EU needs to up its ambitions and create a greater incentive for companies to invest in green technologies by introducing a carbon reduction of target of 50% by 2030 versus 1990. It already has adopted a target of a 20% reduction by 2020 and achieved 17% already. “Without reform, the market will stagnate”, according to Johannes Teyssen.

EU cannot suspend ETS legislation

Posted by Oliver Heaton on 04/06 at 05:23 PM

The EU believes there is a “window of opportunity” for nations to reach a global deal on emissions over the next year according to Joao Vale de Almeida who is the EU ambassador to the US. “We remain fully committed to an international deal,” said Almeida. “Things have started again in the ICAO because there is the regulation in Europe, and we are happy about that.” He reiterated that the EU will not rescind its scheme, “We cannot suspend legislation like that, as you well know.” “It’s been agreed democratically” he said.

Airbus boss urge delay to EU ETS

Posted by Oliver Heaton on 04/06 at 05:15 PM

Speaking at last week’s annual ATAG/IATA Environment Summit in Geneva the Chief Executive of Airbus Thomas Enders urged the EU to defer the implementation of ETS charging part of the scheme due 30 April 2013. He said that going ahead would risk thousands of jobs in Europe due to cancellation of orders by China and said “Delay it, freeze it for one or two years”. Upon closer examination Enders was not explicit that orders had actually been cancelled. Our own assessment is that there has been no such cancellation from the Chinese authorities or airlines; indeed, it was recently reported that Chinese airlines were in fact being allowed to buy whichever aircraft they wish.

India racks up pressure on EU

Posted by Oliver Heaton on 04/06 at 05:13 PM

India which is a member of the 23 countries opposed to the EU ETS knick-named as the “coalition of the unwilling” has racked up the pressure on the EU ETS. Last week the Indian minister for Civil Aviation commented in a parliamentary session that “the imposition of carbon tax does not arise“ and added that “though the European Union has directed Indian carriers to submit emission details of their aircraft by 31 March 2012, no Indian carrier is submitting them in view of the position of the government”.

In our opinion it’s one thing for a government to have such a view, but it’s an entirely different matter for an international business such as an airline needing to comply with local laws and regulations wherever it operates. Given that the EU ETS is already incorporated in the national laws of 27 EU countries for perhaps as long as almost 3 years now, it is difficult to see the EU group rescinding the laws and treating aviation as a “special case” exemption.

It’s important to remember that recently there were rumours of an Indian ETS and that European airlines are now required to submit fuel consumption data to the authorities. It may be tempting to jump to the wrong conclusions, but it’s not unreasonable to speculate that one year from now the EU might have deemed India to have adopted “equivalent measures” and therefore fully or partially exempting carriers from the EU ETS charges on the inbound India to EU sectors.

Deutsche Bank forecasts carbon permit surplus of 1 billion tonnes by 2020

Posted by Oliver Heaton on 04/06 at 05:10 PM

Deutsche Banks AG forecast that the EU carbon market will have an allowance surplus of 1 billion tons by 2020.    The bank cut its forecast to a range from EUR 5 to 7 during the second quarter of 2012 according to an analyst Mark Lewis in Paris.

UBS expects carbon price to collapse

Posted by Oliver Heaton on 04/06 at 05:10 PM

UBS have re-iterated a forecast earlier this year that EU carbon prices could fall to a low of 3 euros if the EU will not change the scheme’s rules and cut supply of carbon permits said UBS AG. “We expect the carbon price to collapse, to accelerate from here,” said Per Lekander, a UBS analyst based in Paris. “Potential sellers have held off selling ahead of the yearly emissions data. The sales pressure is now likely to accelerate. We believe that it will become increasingly clear over the next months that the emissions trading system rules won’t change and with this we see 3 Euros a ton as a likely price floor.”

Air China has neither cut nor cancelled Airbus orders

Posted by Oliver Heaton on 04/06 at 05:09 PM

According to a report by the Shanghai Daily, Air China has neither cut nor cancelled Airbus orders, despite numerous reports from Reuters and other Western news agencies over the past few weeks. Air China is sticking to the delivery plan for the aircraft ordered, according to a top official of China’s flag carrier.  “The stand of the central government is consistent, that is to oppose firmly the EU’s unilateral move to impose a carbon tax,” said Wang Changshun, Chairman of Air China. “The attitude of Air China is the same as our government’s.”  Wang said he had not received any formal notice about any cancellation of the Airbus orders. Board secretary Rao Xinyu said the airline will stick to its plan to take delivery of 35 new aircraft this year, including 14 A320/A310 and six A330 from Airbus.

China's plan for own ETS

Posted by Oliver Heaton on 04/06 at 05:08 PM

According to the Xinhua News Agency, an unnamed source has advised that the Chinese authorities have completed plans for a pilot Emission Trading project and which is expected to be implemented as formal programme during 2013. There is no specific detail as to whether aviation would be included.

EU positive on ETS deal with US

Posted by Oliver Heaton on 04/06 at 05:07 PM

According to a report on Bloomberg, the EU’s Climate Commissioner Connie Hedegaard last week met with the US Transportation Secretary Ray LaHood. “The impression I got is that there is genuine will to try and see if we can agree to something,” Hedegaard said in relation to agreeing to a global deal on aviation emissions reductions.

US airlines cease legal case against EU ETS

Posted by Oliver Heaton on 04/06 at 05:05 PM

United, American Airlines, and their trade association, Airlines for America, have dropped their legal challenge to the EU’s ETS. The airlines gave no explanation for abruptly dropping the case in the UK, but their attorneys may have realised their efforts could be null and void given the strength of the 21st December ruling from the European Court of Justice which upheld the EU directive as consistent with international law.

After pursuing the case for more than two years and losing in the European court, the airlines filed papers asking permission to add new claims just before the case was scheduled to close. The UK High Court had planned to hear their request, but on March 27 the airlines withdrew their appeal.

It now seems that their focus will switch onto political pressure and requesting the Obama Administration to bring a challenge under ICAO’s Article 84 procedure based on similar arguments the airlines intended to use in the London court; arguably a puzzling tactic to adopt. These industry representatives are also pressing the US Congress to prohibit US carriers from participating in the EU law. The ICAO Secretary General has already signalled that an Article 84 challenge would slow the organization’s momentum toward a new agreement.

Aeroflot estimates EU ETS to cost it €800M to 2025

Wednesday, March 21, 2012

Posted by Oliver Heaton on 03/21 at 05:22 PM

The Deputy CEO of Russia’s biggest carrier Aeroflot, which opposes the EU ETS along with 22 other carriers in the knick-named “coalition of the unwilling” has said that the EU’s move to include it in the scheme may cost the carrier 800 million euros in the period to 2025. According to Deputy CEO Igor Chalik “The quotas will be sold on the exchange, so the price will be higher”. For us it’s not immediately clear as to why Aeroflot chose the period to 2025, neither which carbon price they assumed.

EU Group led by Airbus urges compromise

Posted by Oliver Heaton on 03/21 at 05:20 PM

Airbus and eight European airlines have urged the EU to compromise on aviation’s inclusion in the ETS after China apparently stalled a further 10 A330 orders, now totalling 55 Airbus aircraft (10 A380 and 45 A330) worth up to $14 billion.

As we mentioned last week, there is a big game of brinksmanship taking place. Amidst all of these rumours, official statements and then counter-statements, the EU already has a mechanism in place to take into consideration other emission reduction initiatives from other States, or indeed a global scheme under ICAO. The EU is unlikely to bow to external pressures with the only concessions allowed under the law of exempting inbound-EU sectors from the EU ETS in the case of “equivalence”. Time will tell as to what happens, but an analyst at Green Aviation Solutions predicts that at some point in 2013 all airlines flying sectors from China to the EU will be exempted from paying for carbon permits on the inbound EU sector. It could then be logical to assume that a similar situation may arise in respect of flights from Russia, India and the USA, with a domino effect on other inbound EU routes as well, possibly.

26 US Economists urge Obama to support EU ETS

Posted by Oliver Heaton on 03/21 at 05:19 PM

In a rare sign of support for the EU ETS from the US, a group of leading Economists including 5 Nobel laureates urged the President to support the scheme as a first step to placing a price on carbon to help avoid catastrophic outcomes of climate change. “We implore you to support the European Union’s innovative efforts to place a price on carbon from aviation through the emissions trading system (EU ETS), or, at the very least, to stop actively opposing these efforts” they wrote to him in their letter. It will be fascinating to see how this plays out over the coming months.

Aviation progressing rapidly on biofuel uptake

Posted by Oliver Heaton on 03/21 at 05:16 PM

Last week’s “World Biofuels Markets” to which Green Aviation was a media partner saw its largest ever attendance from the aviation sector. This annual conference and exhibition covers all transportation sectors and traditionally Aviation has occupied a small side room for half a day. This year Aviation was given a two day schedule and attendance was varied but we estimate peaked at more than a hundred people. We’ll produce a fuller write up in due course but in summary it was very encouraging to see further new technologies, methods and projects being proposed, especially to produce sustainable biofuels from non-feedstock sources such as Jatropha, algae and various wastes.

One of the most ambitious projects remains the initiative between British Airways and Solena to produce a waste-to-biofuels plant in East London, or nearby, with several potential sites identified in the area. BA expects planning permission to be granted and for work to start in 2013 with an 18 month build completion timescale. The investment will be $350 million and initially produce enough fuel per day to fill 80 tanker trucks. This represents around 2% of BA’s fuel needs in the London area and this initial batch will be used exclusively at the nearby London City airport. Despite the huge investment the business case is made on the existence of the waste used avoiding a $100 per tonne landfill tax.

Elsewhere a Dutch company SkyNRG is supplying several airlines’ trials of biofuel flights with waste oils from catering use and then converted to biofuel. Lufthansa has a partnership with Finnish company Neste and is using a 50% biofuel / kerosene mix on all flights of one dedicated A320 aircraft between Frankfurt and Hamburg for several months, with no adverse events and no apparent differences in engine performance or exhaust deposits.

All this increased activity, and more, bodes very well for the future of sustainable biofuels in aviation, but the crux of the matter is the same for all airlines – how to get sufficient quantities of biofuel and at the right price? Given the technical approval (ASTM D7566) of the 50% biofuel / kerosene mix last year there has certainly been a noticeable increase in interest and investment, and a forecast in the UK Sustainable Aviation Roadmap that by 2050 sustainable biofuels will contribute an 18% reduction in aviation emissions. Personally I am more optimistic as more projects and investments come on-stream it could lead to a snowball effect. Additionally, not only can airlines adopt biofuels to mitigate the EU ETS and other such emissions capping schemes in the future, but I suggest it is increasingly important to develop a strategy of weaning off fossil fuels as an energy security policy and to gain a better price predictability and stability to offer a significant competitive advantage; one major US carrier has adopted exactly such an approach.

The EU plan to reduce carbon permit supply to boost CO2 prices not supported by Poland.

Posted by Oliver Heaton on 03/21 at 01:41 PM


EU Climate Commissioner Connie Hedegaard has stated that said that the EU intends to propose further measures to cut greenhouse gases despite
Poland’s “veto” of a declaration on reducing emissions across the EU. Poland was the only country to block the initiative but it is not the first time that it has blocked environmental initiatives. Poland relies on coal for 90% of its electricity generation and so is highly susceptible to such changes and which can cost it disproportionately. Poland may be taking a negotiating stance trying to win concessions as it has on previous occasions. The EU is trying to boost CO2 prices which have fallen significantly in the past year.

China threatens sanctions on Airbus

Posted by Oliver Heaton on 03/21 at 01:39 PM

A recurring theme over the past months has been the implicit threat to European business interests in China as a tactic to support their objections to their carriers being covered by the EU ETS. There have been plenty of rumours, even announcements, but which were then hurriedly rescinded.

In the past few days the waters seem to have muddied with seemingly contradictory announcements from the Chinese on one side, and an alliance of Airbus and major European airlines on the other side. The latter have become concerned over threats of Chinese reprisals against their businesses and yesterday Bloomberg reported that Europe’s leading airlines and Airbus have jointly written to the governments in France, Germany, Spain and the UK asking to “pull back” on the EU ETS scheme to avoid potentially serious consequences for the aviation industry.

This plea follows a surprisingly conciliatory announcement last week from the Civil Aviation Administration of China which said that is has not forbidden their airlines from purchasing Airbus planes – and just a couple of days after Airbus’ owner made a comment stating China may refuse to accept planes from Airbus in protest at the carbon emissions tax! Confused?! A spokesperson from the CAA said “The purchase of airplanes is a business activity by airlines, in which the government doesn’t intervene.” “The government respects the companies’ choices, which are made based on their own needs.”

All that airlines can expect is that the uncertainty is likely to continue and we suggest that they should plan their carbon purchases accordingly with specialist advise.

"Aviation Carbon 2012” possibly the largest aviation and environment event in at least the past one year

Posted by Oliver Heaton on 03/21 at 01:32 PM

“AC2012” had more than 320 registered attendees from more than 60 countries and from at least 112 distinct airlines / operators! We believe that this may make it the largest aviation event of its kind anywhere in the world during the past year, and coincidentally even exceeding the last IATA / ATAG Environment Summit!

The feedback was overwhelmingly good / excellent, but there were also some very helpful comments that will enable the ACE team to learn and improve for next year, especially the streaming of different ability levels and having different workshops for different sectors and different strategies. The scope may possibly also extend to cover other ETS topics such as IT solutions, biofuels and fuel management.

If you have any particular suggestions please do not hesitate to email Andrew Pozniak at andrew.pozniak@greenaviation.aero

Air AsiaX blames EU ETS for dropping European flights

Monday, January 23, 2012

Posted by Oliver Heaton on 01/23 at 01:49 AM

AirAsiaX the Malaysian low cost longhaul carrier has announced that it will stop flying to London and Paris at the end of March due to the introduction of the EU ETS. They also blamed fuel costs and the economic slowdown as reasons.

They will also stop flights to India. In contrast they intend to boost services to Australasia, China and northeast Asia to focus on more profitable markets for them.

EU Aviation Allowances might be traded from June 2012

Posted by Oliver Heaton on 01/23 at 01:48 AM

According to the Austrian emissions trading registry the “trading of allowances will be possible from the full activation of the Union Registry” i.e. when it is fully operational, and which is expected to happen in June 2012. By that date the transfer of national registries to the EU registry will have taken place, if all goes according to plan, as “always” with the ETS…

Ryanair and Delta to introduce ETS levy

Posted by Oliver Heaton on 01/23 at 01:47 AM

Ryanair will introduce a 25c ETS charge on every seat from Tues 17th January to cover their estimated €15m - €20m ETS bill for 2012. From our calculations this is about the right amount to cover their incremental carbon permit costs, as an average across their network. This announcement follows similar moves earlier this month by several US carriers including Delta who will charge a levy of USD 3 per passenger, which according to our estimates is perhaps a little higher than their incremental costs and which may be intended to recover additional EU ETS costs incurred.

EU Tells US it will not abandon EU ETS for airlines

Posted by Oliver Heaton on 01/23 at 01:46 AM

According to Bloomberg reports on 17 January the EU’s transport and climate commissionaires have responded to Hilary Clinton’s request to exempt US airlines from the EU ETS by writing to her that “We see the inclusion of aviation in the EU ETS as an important contribution to, and a catalyst, towards global action, rather than an obstacle.” “We believe there’s now a growing recognition of the need to move forwards in ICAO to develop a global solution and we hope that the U.S. shares our view that we must seize this opportunity.”

The EU adds that it is willing to discuss exempting incoming flights from the US if they are willing to introduce equivalent measures to reduce airline emissions. They further re-iterated that EU law could be amended if and when there is a worldwide ICAO agreement on airline emissions.

Global Airline Carbon Market Unlikely Before 2018, Germany Says

Posted by Oliver Heaton on 01/23 at 01:45 AM

A global airline ETS under the auspices of ICAO might not be created until 2018 according to a German parliament newsletter. Because ICAO has not yet even drafted a proposal for an airline ETS the German’s believe that they are unlikely to have one ready in time for the next ICAO general meeting in 2013, and which could mean that it would be left until the following meeting in 2016.

Whichever meeting actually backs such the ETS proposal it is likely to take a further two years to prepare and implement. However, ICAO has previously said in November 2011 that it aimed to have a proposal in place by then end of 2012, so either the Germans are being very pessimistic or ICAO is being overly optimistic.

Some airlines buying CO2 at record low prices

Posted by Oliver Heaton on 01/23 at 01:39 AM

Several major airlines are already taking advantage of low carbon permit prices despite recent outcries from the airline industry against the EU ETS, helping to increase demand in a market which has seen prices tumble by up to 60% in the past year. According to an article published by Reuters, Lufthansa are “continuously buying allowances”. The airline is expected to have received 65% of its allowances free of charge hence needing to buy the remaining 35% in the marketplace, which could be a cost impact of EUR 130 million on the airline although it is anticipated it will be passed on their customers.

At least one Exchange is taking notice of the increased interest from airlines. Slovakia’s Commodity Exchange Bratislava is the first to announce that it will commence trading in EU Aviation Allowances by the end of February 2012. This contrasts with the negative sentiment from several exchanges last year who said they had no plans at the time to offer EUAA trading facilities due to the costs of setting up a new process outweighing the benefits, thereby leaving the trading to “over the counter” and carbon traders. Perhaps they may now change their minds after Bratislava has set the lead.

According to Steve Ridgway the CEO of Virgin Atlantic carbon trading will develop into a routine as common as fuel hedging for airlines. Virgin will get 3.6 million EUAAs in 2012 against its estimated emissions of 4.5 million tonnes.
A spokesperson for Air France-KLM estimates they will need 7 million CO2 permits in 2012 which they reckon will cost them between EUR 50 to 100 million.

The total demand from the airline sector by 2020 could reach 700 tonnes per annum according Thomson Reuters Point Carbon, thereby making this sector the second largest buyer in the EU ETS after the electricity sector.

Aviation progressing rapidly on biofuel development

Wednesday, January 18, 2012

Posted by comms on 01/18 at 12:01 PM


image
 
We are once again proud to announce that Green Aviation will be media partners to “World Biofuels Markets” on 12—14 March 2013 at the Beurs-World Trade Center, Rotterdam, Netherlands!

The last conference back in February 2012 saw its largest ever attendance from the aviation sector. This annual conference and exhibition covers all transportation sectors and traditionally aviation has occupied a small side room for half a day. In 2013 Aviation was given a two day schedule and attendance was varied but we estimate peaked at more than a hundred people. 2014 will also feature a dedicated stream for aviation. For more information click on the image above.

One of the most ambitious projects covered in the 2012 conference was the initiative between British Airways and Solena to produce a waste-to-biofuels plant in East London, or nearby, with several potential sites identified in the area. BA expects planning permission to be granted and for work to start in 2013 with an 18 month build completion timescale. The investment will be $350 million and initially produce enough fuel per day to fill 80 tanker trucks. This represents around 2% of BA’s fuel needs in the London area and this initial batch will be used exclusively at the nearby London City airport. Despite the huge investment the business case is made on the existence of the waste used avoiding a $100 per tonne landfill tax.

Elsewhere a Dutch company SkyNRG is supplying several airlines’ trials of biofuel flights with waste oils from catering use and then converted to biofuel. Lufthansa has a partnership with Finnish company Neste and is using a 50% biofuel / kerosene mix on all flights of one dedicated A320 aircraft between Frankfurt and Hamburg for several months, with no adverse events and no apparent differences in engine performance or exhaust deposits.

All this increased activity, and more, bodes very well for the future of sustainable biofuels in aviation, but the crux of the matter is the same for all airlines – how to get sufficient quantities of biofuel and at the right price? Given the technical approval (ASTM D7566) of the 50% biofuel / kerosene mix last year there has certainly been a noticeable increase in interest and investment, and a forecast in the UK Sustainable Aviation Roadmap that by 2050 sustainable biofuels will contribute an 18% reduction in aviation emissions. Personally I am more optimistic as more projects and investments come on-stream it could lead to a snowball effect. Additionally, not only can airlines adopt biofuels to mitigate the EU ETS and other such emissions capping schemes in the future, but I suggest it is increasingly important to develop a strategy of weaning off fossil fuels as an energy security policy and to gain a better price predictability and stability to offer a significant competitive advantage; one major US carrier has adopted exactly such an approach.

EU ETS is legal - does not infringe international law or the Open Skies Agreement

Thursday, December 22, 2011

Posted by Oliver Heaton on 12/22 at 10:00 PM

Finally the European Court of Justice has announced its long-awaited ruling in relation to the legal action initiated by the US and Canadian airlines and associations against the EU ETS.  In its judgment delivered today, 21 Dec, the judges at the European Court of Justice confirmed the validity of the EU ETS directive that includes aviation activities in the emissions trading scheme.
 
The Court’s first point was that it established that the EU is not bound by the Chicago Convention because it is not a party to that convention. Its second point relating to the Kyoto Protocol, the Court observed that the parties to the protocol may pursue limitation or reduction of emissions from aviation fuels outside of ICAO.
 
The Court then examined whether the EU ETS directive is compatible with the principles of customary international law and the Open Skies Agreement. It judged that the EU ETS is not intended to apply to aircraft flying over the high seas or over the territory of the Member States of the EU or of third States and it is only if the operators of such aircraft choose to operate a commercial air route arriving at, or departing from, an airport situated in the EU that they are subject to the EU ETS.
 
In relation to the operator of an aircraft being required to surrender emission allowances calculated on the basis of the whole of the flight, the Court pointed out that EU legislature may permit air transport to be carried out in its territory only on condition that operators comply with the criteria that have been established by the EU.
 
Finally, the Court responded to the claim that the EU ETS constitutes a tax, fee or charge on fuel in breach of the Open Skies Agreement. It ruled that the EU ETS does not infringe the obligation to exempt fuel from taxes, duties, fees and charges and that the actual cost for the operator depends, because it is a market-based measure, not directly on the number of allowances that must be surrendered, but on the number of allowances initially allocated to the operator and their market price when the purchase of additional allowances proves necessary in order to cover emissions.
 
The Court added that it cannot even be ruled out that an aircraft operator, despite having held or consumed fuel, will bear no pecuniary burden resulting from its participation in the emissions trading scheme, or will even make a profit by assigning its surplus allowances for consideration.
 
The Court concluded by stating that the uniform application of the scheme to all flights which depart from or arrive at a European airport is consistent with the provisions of the Open Skies Agreement designed to prohibit discriminatory treatment between American and European operators.
 
The full judgement is available at this shortened link:  http://bit.ly/sMqkBV
The shortened press release is available at this shortened link:  http://bit.ly/sXJMDx
 
So what does this mean for airlines?
 
In our view it means that nothing changes, the airlines should keep on complying with EU ETS as they have done so far until such a time that there lawyers may ever advise them not to do so. The EU have already stated that they are negotiating the possibility of agreeing “equivalent measures” with several non-EU States and if they should come to an agreement that might have a bearing on the inbound EU sector with those nations, but not on the ex-EU or intra-EU sectors.

US requests ETS data from European and US airlines

Posted by Oliver Heaton on 12/22 at 09:30 PM

The US Department of Transportation (DOT) issued an order on Monday 19th Dec to nine European carriers to submit ETS related information by 31 January 2012.  The orders do not specify what they will use the data for but it is believed by some observers that the data will help the DOT to potentially define retaliatory measures on EU airlines flying to the US. Others believe that this may be related to discussions concerning EU ETS equivalent measures.
 
The order was served upon Aer Lingus, Air France, Alitalia, British Airways, Deutsche Lufthansa, Iberia, KLM, SAS and Virgin Atlantic. 
 
The data that the DOT requires is –
DATA and REPORTING DATE:
 
1) Free 2012 allowances allocated
January 31, 2012
 
2) Free 2012 allowances received, if different from 1) (If not different, so advise.)
March 31, 2012
 
3) 2010 revenue tonne kilometers reported to administering state
January 31, 2012
 
4) 2010 revenue tonne kilometers operated on flights between U.S. points and points in the EU, Norway, Iceland, and Liechtenstein
January 31, 2012
 
It should be noted that similar data has also been requested of seven US airlines, however financial data is additionally requested. The airlines affected are American Airlines, Continental, Delta, Fedex, United, UPS, and US Airways. The data that the DOT requires is –

DATA and REPORTING DATE
 
1) Free 2012 allowances allocated
January 31, 2012
 
2) Free 2012 allowances received, if different from 1) (If not different, so advise)
March 31, 2012
 
3) Estimate of allowances needed for 2012 operations covered by ETS April 15, 2012
 
4) 2012 CO2 emissions reported to administering state
March 31, 2013
 
5) Monetary amount paid to administering state in ETS allowance auctions
15 days after the close of each auction
 
6) Monetary amounts spent and/or received in ETS allowance markets
Within 15 days after each such event.
 
If I were an ETS Manager for an airline not currently impacted by this request I would nevertheless start working with my analyst, or IT department, or external supplier to be able to provide this kind of data accurately and quickly in case the US extends the requirement, or other Nations especially Canada, China and Russia decide to follow the US DOT example.

EU Carbon Price for 2012 in Record Jump as EU Parliament Supports Reducing Allowances

Posted by Oliver Heaton on 12/22 at 09:00 PM

After seeing carbon prices plunge this year due to investor worries about the Eurozone and the over-supply of carbon allowances into the ETS, and carbon prices which bottomed out at a low of EUR 6.30 last Wednesday, prices experience an unprecedented record jump this Tuesday after the EU parliament’s environment committee backed a proposal that would require the EU executive to cut the supply of allowances. Allowances for December 2012 closed 21 per cent higher on the day, but reached a peak at 32 per cent to EUR 9.75 during trading on the ICE Futures Exchange. In context, prices have now dropped approximately 39 percent year to date.

Australia to Develop Links With Global Carbon Markets

Friday, November 18, 2011

Posted by comms on 11/18 at 01:01 PM

According to an article on Bloomberg the Australian Prime Minister Julia Gillard is in talks with the EU and New Zealand with a view to linking up their markets for emissions capping and trading. She also highlighted that they will be reaching out to other nations.

She made the comments on the day after Australia passed a law that will require around 500 of their biggest companies to pay for their carbon emissions for the first time. The emitters will have an option of offsetting up to 50% of their emissions via carbon emission reduction projects in developing countries. The remainder will need to be purchased at A$23 per tonne (approx. €17 today) from July 2012. This compares to the current price of EUAs around €10 per tonne CO2.

The news comes ahead of the meeting of 191 nations in South Africa for 2 weeks commencing 28th November 2011 concerning climate negotiations. The talks are planned to try and come to some form of agreement on a post-Kyoto global agreement. However, progress has been painfully slow in the past 2 years due to particularly major differences between the big players such as China and the US. 

Although the US doesn’t yet have a nationwide ETS emissions trading system the state of California is nevertheless introducing an ETS in 2013. Gillard said about that “We don’t underestimate the impact of American states making a decision to move to carbon pricing.”

Delaying Emissions Redutions May Cost $4 per $1 Avoided

Thursday, November 17, 2011

Posted by comms on 11/17 at 02:18 PM

The International Energy Agency (IEA) has estimated that by Nations delaying the follow-up agremeent to the soon to be expiring Kyoto agreement will be a significant false economy. The IEA’s “World Energy Outlook” report stated that “for every $1 of investment avoided before 2020 an additional $4.30 would need to be spent after 2020 to compensate for the increased emissions”. “Delaying action until 2015 would call for early retirement or retrofitting of plants emitting 5.7 billion tons of carbon dioxide in 2035, around 45% of the global installed fossil-fuel capacity.” This is in the context that because power stations and other installations typically have lives in excess of 25 years and 80% of emissions would be “locked in” and largely unchangeable, leaving policy makers little room for manoeuvre.

EU ETS Prohibition Act moves forward

Wednesday, November 02, 2011

Posted by comms on 11/02 at 02:42 PM

Last week the Bill to “To prohibit operators of civil aircraft of the United States from participating in the European Union’s emissions trading scheme, and for other purposes“ was supported by the House of Representatives. The next planned steps are to take the Bill to a vote in the Senate, but it is not clear when this will happen. If it is passed by the Senate then it still would need to be approved by the President and it is doubtful in many quarters as to whether Obama would actually support such a Bill which has an explicit intention of preventing US companies of complying with the laws of allies.
How will the EU respond? So far it has insisted that nothing will change but that discussions are underway concerning “equivalent measures” which could take into account aviation carbon reduction measures being implemented in other States and in some way reflecting that within the EU ETS. What does that mean in practice?
We think that the EU ETS will probably remain unaffected in terms of its structure but for inbound EU sectors there may be an adjustment / recognition in the form of a greater number of free allowances or in the case of “full equivalence” the inbound EU sector could in effect be exempted completely. However it is most unlikely that the EU will compromise the integrity of their own ETS by exempting completely any participant or country from the scheme.
At this point in time we would suggest to all aircraft operators based in those countries where there is a dispute with the EU that they should nevertheless strongly consider to continue to plan for the ETS to apply on all their ex-EU and intra-EU sectors, at the very least.

US expected to respect EU carbon law

Posted by comms on 11/02 at 02:41 PM

The EU’s Climate Commissioner Connie Hedegaard is very confident that the US will allow its carriers to comply with the EU legislation on EU ETS. She pointed out that “the EU respects US legislation and US lawmakers’ authority in US airports” and that “if the US wants to handle emissions from aviation differently, that is fine; our legislation clearly envisages that if a country outside the EU takes ‘equivalent measures’ to address aviation emissions then all incoming flights can be exempted from the EU system.”

Airlines to “break even” on EU ETS carbon during 2014

Posted by comms on 11/02 at 02:40 PM

According to Bloomberg / New Energy Finance the global airline industry could stop losing money due the need to buy EU ETS carbon permits in 2014 as air fares are expected to rise to more than cover actual costs. “The aviation industry should start to break even under the EU emissions trading system by about 2014, as its ability to increase fares exceeds its cost of paid-for carbon allowances,” according to Guy Turner, Director for commodity market research at London- based New Energy Finance, said Wednesday 26 Oct.

Advocate General says international aviation in EU ETS is compatible with international law

Wednesday, October 12, 2011

Posted by comms on 10/12 at 02:46 PM

On the 6th October the Advocate General stated her opinion that the inclusion of international aviation within the EU ETS is compatible under international law. She was quoted as stating “EU legislation does not infringe the sovereignty of other States or the freedom of the high seas guaranteed under international law, and is compatible with the relevant international agreements“. The ECJ is expected to make a final ruling in early 2012 but based on historical cases it is expected to a degree of certainty of 80-90% to agree with the AG’s opinion, but only time will tell.
What does this mean for non-US nations? We are of the opinion that had there been any indication that international law may have been breached then several other nations may have also raised legal action and / or continued their resistance to the EU ETS. Whilst in public China and Russia and others may continue to make other arguments against the EU ETS we feel that it is now less likely, although not impossible, that the EU ETS will not apply to their aircraft operators and that those operators will continue to comply as they have done already since their preparations for EU ETS started in 2009.
In the event that an operator purchases carbon permits but then requires less of them, or is exempted from the EU ETS for legal or political reasons in the future, then they should be able to monetize those allowances by selling them into the carbon exchanges or a broker, especially if the EU decides to seriously take action in 2013 to lift the carbon permit prices to a minimum level of EUR 30 (see news in “Carbon Market News Briefs” on page 5 of this newsletter).

European Low Fares Airline Association supports EU ETS!

Posted by comms on 10/12 at 02:45 PM

In a surprising move last week the European Low Fares Airline Association have publicly stated their support of the EU ETS. Secretary-General John Hanlon was speaking at the World Route Development Forum in Berlin and said the EU ETS was “not perfect” but that it is an environmentally effective mechanism to deal with aviation’s impact on climate change and better for airlines and consumers than government taxes. He made a point that everyone is keen on a global ETS solution under ICAO but that it is not yet available and threw ELFAAs support behind the EU ETS, “We totally support the EU’s conclusion that it is the most effective way of accounting for the cost to the environment with minimal cost to customers.” He believes that ETS is a better solution than taxes because the airline industry “can still grow by buying allowances” and “ETS has a cost but it is much better for the consumer”.

IATA says airlines likely to try but fail to pass on EU ETS costs to passengers

Posted by comms on 10/12 at 02:44 PM

According to IATA Director General Antony Tyler airlines will try to recover the cost of the carbon permits which they will need to purchase over and above their free allowances. He said that it is naive to think they will be successful however, due to the highly competitive pricing environment. However our own view is that since ETS is likely to cost an airline a premium on its fuel bill in the range of 5-10% over the life of the ETS and that the average airline profit margin according to IATA is a mere 1.5% then that leaves little, if any, option but to pass on the majority of their carbon costs in higher fares.

Virgin Atlantic to Fly Planes Using Waste Gas of Steel Mills

Posted by comms on 10/12 at 02:44 PM

According to Bloomberg the airline Virgin Atlantic is planning to fuel their jets from Shanghai and Delhi to London from waste gases from steel mills turned into alternative jet fuel. LanzaTech NZ Ltd will make the fuel using technology by Swedish Biofuels AB, according to Virgin. The flights are expected to start in 2-3 years and LanzaTech will be building fuel plants in China and India. The new fuel is undergoing tests in New Zealand and a larger demo facility will be completed in Shanghai by the end of this year. According to Richard Branson chief of Virgin “This new technology is scalable, sustainable and can be commercially produced at a cost comparable to conventional jet fuel. With the steel industry alone able to deliver over 15 billion gallons of jet fuel annually, the potential is very exciting.”

EU defends its position on aviation sector in ETS

Monday, September 26, 2011

Posted by comms on 09/26 at 02:50 PM

In respect of the political pressures and legal actions being raised against the EU and Member States concerning the EU ETS, Climate Action Commissioner Connie Hedegaard has been quoted today:

“As much as the EU prefers global action, we can’t defend that the aviation sector is exempted from contributing because they can’t agree internationally. This is why the EU decided to take this step forward in 2008 while we will continue to fight for global regulation of aviation like at the next UN climate negotiations in Durban“. “For many, many years we, more than anyone, fought hard to get an international agreement on aviation; unfortunately without success,” “We’re already asking contributions from our power sector, from other industries, so we think that while we’re expanding the system in Europe it’s not logical that some of the big sectors where emissions are growing should be exempted.” “There’s a lot of informal dialogues with lots of different countries,” said Hedegaard said. “The reason for these equivalent measures was to try to inspire all these countries to discuss what are you doing with your aviation industry, but we’d very much like to have aviation as part of the outcome from the United Nations climate talks in Durban.”

We will see as to what actually evolves and happens on this front. On 8th September a US Bill to “To prohibit operators of civil aircraft of the United States from participating in the European Union’s emissions trading scheme, and for other purposes“ was approved to move forwards from the transport committee to a vote in the whole of the House of Representatives at some point in the future.
Separately, the European Court of Justice is expected to provide a preliminary opinion on 6th October 2011 concerning the legal action taken by US carriers against their inclusion in the EU ETS. Whichever way the opinion goes will, in our humble opinion, lay down a clear marker for how non-EU States / airlines will continue to cooperate, or not, with the EU ETS starting 1 January 2012.

Air Berlin makes first aviation carbon permit deal

Posted by comms on 09/26 at 02:49 PM

The European low cost airline Air Berlin has made the first ever trade in EU aviation allowances (EUAAs) with the German bank Commerzbank, according to the two firms on Monday. According to Reuters the units that were traded were EUAA futures for December 2012 delivery and the quantity was “substantial”.
Although EUAAs do not yet exist, Air Berlin and Commerzbank nevertheless structured some kind of futures agreement between them and which was related to a benchmark of the EUA price.
No price details of the deal have been revealed but December 2012 EUAs are currently trading (Monday 26th) on the European exchanges and with brokers such as Climate Corporation at around the EUR 11.50 level. It is speculated by some traders that when EUAAs are available they likely to be priced a few cents or few tens of cents lower than standard EUAs because they can only be used by airlines and not the other 90% of EU ETS participants. This could make EUAAs less liquid and generally less tradable and therefore discounted in price.
It is important to note that airlines can also purchase EUAs and CERs and are not actually required to purchase any EUAAs whatsoever. The free carbon allowances that they will receive in their registry account in February 2012 will be EUAAs which need to be submitted in March / April 2013 shortly after their verified 2012 emissions reports are submitted. These free allowances will need to be accompanied with purchased EUAs and / or CERs to cover the verified emissions totals.
Because of the 1 year gap between receipt of free allowances and the need to submit them some operators may even adopt a strategy of selling their free EUAAs if they consider the price to be favourable or if they need the cash generated from their sale for other purposes. This may possibly be one of the motivations for the Air Berlin / Commerzbank deal. However they will need to buy back the equivalent number of carbon permits (EUAs, CERs, EUAAs) no later than April 2013.

European airline associations concerned

Monday, August 29, 2011

Posted by comms on 08/29 at 03:04 PM

Trade associations representing Europe’s network and regional carriers have recently called on the European Commission to promptly address the growing international pressure for the EU Emissions Trading Scheme (EU ETS) to drop the inclusion of airlines from outside Europe, particularly pressure from the United States which includes a court case as well as a legislative Bill.
The Association of European Airlines said that with just five months before the start there was now considerable uncertainty on the scheme’s future. In the face of a threatened international withdrawal, the European Regions Airline Association said the scheme must apply to all airlines, regardless of origin, or none.

Following the introduction of the proposed legislative Bill in the US House of Representatives which if passed would forbid US airlines to participate in the EU ETS, a hearing of the House Aviation Subcommittee took place on July 27 but as of yet there is no conclusion. China and Russia are considering taking actions of their own, including the possibility of bringing a joint formal complaint at ICAO against EU states over the inclusion of their airlines into the ETS. However such action is very rare and the process can take many years. Our guess is that this complaint, if it actually happens, will therefore be used a political tool to gain concessions for their airlines.

However, many lawyers believe that the EU courts are most unlikely to overturn an EU law (and especially as the door was already open to all nations to negotiate), and that most likely the scheme will continue unaffected possibly with some further concessions of additional allowances or only ex-EU sectors. In one possible scenario airlines could face conflicting legal obligations - EU law would require airlines to pay fees, but US law could prevent them from paying them – forcing a standoff.

Brokers expected to dominate initial aviation EUAA trades

Posted by comms on 08/29 at 03:02 PM

According to an article by Pointcarbon carbon brokers rather than Europe’s Exchanges are expected to dominate in the initial stages of trading in EUAAs (EU Aviation Allowances). The Exchanges have apparently said that that they have no immediate plans to launch contracts for the aviation sector.

Editor: What does this mean for airlines? Is it a major issue or not?  Well the rules are that brokers are indeed able to trade on behalf of all clients and between their clients and can do so “over the counter” (OTC) between interested parties and without an Exchange. An Exchange is created or involved when there is sufficient market interest in a particular allowance. It seems that at least initially there is no anticipation of significant volumes of EUAA changing between parties and so the Exchanges who support larger volumes will not get involved since the benefits of doing so will be lower than the costs. For brokers the equation and incentives are different. For example Climate Corporation is a long-time member of the biggest European spot exchange for EUAs and CERs (Bluenext) but it also offers its own OTC (trading platform - the Carbon Pool Europe – in addition. Climate Corporation are able to guarantee to offer the real time prices on the market and will always be able to buy/sell EUAs/CERs at a client’s designated price level. Should you require any further information, please don’t hesitate to contact us on via the contact form of this site.

EU's Barroso stands firm in airline emissions row

Wednesday, June 15, 2011

Posted by comms on 06/15 at 01:24 PM

Source Reuters: “The European Union is not considering changing its law obliging airlines flying to Europe to buy carbon emissions permits, European Commission President Jose Manuel Barroso said on Wednesday 8 June. “The inclusion of aviation in the ETS is not a proposal, it is now European law. It was approved unanimously by the member states of the European Union, and it was adopted ... with a very strong backing by the European Parliament. So we are not thinking at all about the possibility of changing our legislation,” Barroso told a news conference”. Barroso reiterated the EU’s willingness to discuss the measures - “The goal is to reduce emissions,” he said. “All the world should unite in some kind of directive like this one.”

IATA supports CO2 trading

Posted by comms on 06/15 at 01:20 PM

Sources, various: “IATA stated last week that it had not retreated from its support for emissions trading but said the EU’s scheme for aviation was unfair and costly. “IATA’s position is very clear. We see emissions trading as a useful tool and we’ve not backed away from that at all,” said Paul Steele, Director, Aviation Environment, for the International Air Transport Association and ATAG, Air Transport Action Group.  “The issue about the EU ETS is not about the ETS as a mechanism, it’s about the fact that the EU has probably over extended itself in the way it’s trying to impose it,” he told reporters. He continued “Our concern from an industry point for view is there doesn’t seem to be any accountability mechanism to sign off on what an equivalent measure is, apart from what the Commission decides it is”.  “It’s one of the biggest concerns we have right now, that we’ll end up with an even greater patch-work of measures.”

New report tracks aviation biofuels collaboration

Monday, March 28, 2011

Posted by comms on 03/28 at 08:22 AM

New report tracks aviation biofuels collaboration
Source: ATAG

25/03/2011

The Air Transport Action Group (ATAG) has released a new report, Powering the Future of Flight, which tracks progress in some key aviation biofuels projects worldwide and provides policymakers with a few examples of how they can help the deployment of biojet fuel.
The publication looks at four case studies in detail – the collaboration occurring in the United States, the Mexican Government’s work to develop aviation biofuels, a project in the United Kingdom to turn household waste into aviation biofuel and a collaboration between the aviation sector and research institutions to bring algae-sourced biofuels to market. It also takes a brief look at a number of other current projects.
 
Paul Steele, Executive Director of the cross-industry aviation coalition ATAG said, “It wasn’t many years ago that the idea of using biofuels for flight was dismissed out of hand on technical and safety grounds. Today, we have tested a range of biofuels in flight, we have made our way through a very tough technical standards process to ensure flight safety and we have been working hard to establish the correct sustainability criteria for the fuels we use.”

“The biggest challenge now lies in ensuring a steady, reliable, cost-effective and sustainable supply of this new energy source. The fossil fuel industry has had a century to develop its fuel sources, supply chains and distribution networks. Not to mention its profit margins. The fledgling aviation biofuels industry will need to catch up and this will require capital from the investment community and start-up incentives and de-risking from governments.”

Powering the Future of Flight takes a bold approach in identifying ‘six easy steps’ that governments and policymakers could follow to assist aviation and the biofuels sector in embracing sustainable aviation biofuels. The steps are:
1) Foster research into new feedstock sources and refining processes
2) De-risk public and private investments in aviation biofuels
3) Provide incentives for airlines to use biofuels from an early stage
4) Encourage stakeholders to commit to robust international sustainability criteria
5) Understand local green growth opportunities
6) Establish coalitions encompassing all parts of the supply chain

“Of course, these six steps are not actually an ‘easy’ task. What we set out to do is illustrate the process in a simple way.

“It is clear that aviation is ready to become a major customer in the sustainable biofuel market. It is vital for our future and it is an important step in reducing carbon emissions. This publication, we hope, will provide some inspiration and ideas based on work already underway.”

European Airline Heads Reassert Commitment to Low CO2 Future & Biofuel Investment

Sunday, February 20, 2011

Posted by comms on 02/20 at 07:42 PM

Fri 18 Feb 2011

Heads of European airlines meeting in Brussels Friday reasserted their commitment to an environmentally responsible airline sector. The members of the Board of the Association of European Airlines were assembled for their first meeting under the Chairmanship of Steve Ridgway, Chief Executive of Virgin Atlantic and reasserted AEA’s support of an environmentally effective and economically efficient ETS, as a precursor to a global scheme.

However they raised issues with the ETS with which many airlines have been struggling with for the past 2 years and are now undergoing their first verification exercise, which is a very challenging time for most carriers. “The 1 January 2012 start date for EU ETS is fast approaching, but there are still many critical areas which need to be resolved”, said Steve Ridgway. “It’s imperative that the Commission fixes these issues to ensure that the Emissions Trading Scheme works as always envisaged, and avoids creating unfair market distortions or undermining its environmental effectiveness”.

If aviation’s contribution to society is not to be diminished in the quest for lower environmental impact, instruments such as ETS need to be complemented by clean technology, said the AEA Chairman, “We call on the EU to stimulate the development of step change technologies – putting Europe at the forefront of this new industrial revolution -  critical amongst which are sustainable alternative fuels with their obvious potential to reduce aviation’s carbon footprint”.

The AEA CEOs expressed their readiness to cooperate fully with the European Commission in working out the necessary conditions for an effective transition to new generation fuels.  “The Treasuries of EU Member States will be receiving massive incomes from ETS.  It is only common sense that these revenues should provide the investment needed to further the aims of an environmental policy”, said Mr Ridgway. 

“This includes funding for the SESAR project to provide the next generation of Air Traffic Management, and the research & development effort to break aviation’s current dependency on fossil fuels, stabilise the energy supply chain and deliver more quickly a lower carbon future for our sector”. 

Markets Affected by CO2 theft & Phishing Attacks

Thursday, January 27, 2011

Posted by comms on 01/27 at 09:35 PM

28 Jan 2011, Bloomberg

Europe’s emissions markets may be “significantly harmed” unless regulators set a deadline for fixing the security flaws exposed by carbon thieves, the International Emissions Trading Association said.
The 30 registries that track ownership of emission allowances in Europe were closed for a ninth day, preventing prompt trading even as futures markets remain open. About 29 million euros ($40 million) of permits are missing in a series of hacking attacks, according to figures announced last week by the European Commission, which regulates the world’s largest greenhouse gas market by traded volume.
The commission received the first batch of reports it demanded last week to show that nations have adequate security, it said today in a statement. That means some registries may be able to reopen in the second half of next week, it said. ICE Futures Europe, the biggest market for carbon, said yesterday its next-day market will be closed until at least Feb. 7. The Czech registry said it would be closed for six weeks or longer.

“IETA deplores the lack of attention paid to enhancing registry security despite last year’s phishing attacks and despite repeated warnings,” Henry Derwent, president of the Geneva-based lobby group, said today in a statement. “The impact on the market of protracted closures could be significantly enhancing risk exposures in terms of unwitting purchase of stolen and potentially reclaimable allowances.” Elaine Bailey, spokeswoman for ICE, declined to say whether any missing allowances ended up in its clearing house.

‘Phishing Attacks’

Carbon market fraud in the last two years included value- added tax fraud and so-called “phishing attacks,” in which internet fraudsters con factories out of passwords and then steal allowances.
“While the safety of online banking has been scaled up, EU member states have failed in protecting an 80 billion-euro market, thereby undermining the EU’s main tool to reach climate objectives,” IETA said.

EU Climate Commissioner Connie Hedegaard, speaking today at the World Economic Forum in Davos, Switzerland, said EU nations are “working very hard” to improve security and rejected suggestions that carbon markets have been wrecked by fraud. “It’s not the system that is wrong,” Hedegaard said in an interview. “Wherever you have financial assets of some kind, you can experience fraud. We see that in all sorts of other areas. Just because someone robs a bank, you do not say the whole banking system doesn’t work.”

Blackstone Global Ventures, a trader based in the Czech city of Brno, informed national administrators on Jan. 19 that it lost 475,000 allowances. The next day, Barclays Plc said it had stopped most spot carbon trading last month after Holcim Ltd., the Swiss cement maker, lost 1.6 million EU permits worth another 23.6 million euros. CEZ AS, the largest Czech power producer, said yesterday it lost 10.5 million euros worth of allowances in unauthorized transfers in last week’s raids on the national registry.

“We are in close dialogue with member states on this,” Hedegaard said. “They’re working very hard. Some could open rather soon, some could take a little bit longer. We want to do this with quality rather than rushing and then something happens.”

While the system is set to have a central clearinghouse in the next trading period starting in 2013, so-called national registries are now responsible for tracking ownership of permits. “Until then, it’s the responsibility of the member states to take care of security,” Hedegaard said.

To contact the reporter on this story: Mathew Carr in London at m.carr@bloomberg.net; Ewa Krukowska in Brussels ekrukowska@bloomberg.net
To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

US carbon trading sets whereas Korea rises

Tuesday, November 02, 2010

Posted by comms on 11/02 at 10:45 AM

2 Nov 2010
The Financial Times reported today that the owner of the US’s only nationwide industrial cap-and-trade (also known as ETS) market, and which is a voluntary scheme at present, has said companies such as Ford and IBM were no longer interested in trading carbon emissions credits in the absence of US government legislation. Senate Democrats have abandoned interest in cap-and-trade legislation and with Republicans expected to make big gains in this week’s elections the outlook for legislation looks very remote. Link to full article

It therefore appears that any such scheme including aviation in the US is even more remote. The recent ICAO talks failed to agree on implementing any economic measures such as cap and trade therefore the EU ETS is the only significant scheme remaining and which the EU is likely to support even more strongly given their perceived lack of action elsewhere in the world at the moment.

Meanwhile the Korea Herald reports that their government is pushing to introduce a cap-and-trade system for carbon dioxide as early as next year. The trading mechanism is a key instrument for Korea’s goal of reducing greenhouse gas emissions by 30 percent below “business-as-usual” levels until 2020. The Ministry of Environment is drafting an emission exchange scheme, planning to send a related bill to the National Assembly within this year and implement the system in 2011.

Under such programs, governments impose emissions caps on companies and organizations and those that succeed in cutting emissions below their quotas are allowed to sell remaining allowances.
The World Bank valued the global carbon market at $144 billion in 2009, up 6 percent from 2008 in spite of a global recession. The figure is projected to grow to $170 billion this year. The European Union’s Emissions Trading Scheme is the world’s largest carbon trading scheme and makes up 64 percent of the total sales volume in 2009, worth $118 billion. Link to full article

EU May Ease ETS Requirements

Wednesday, October 13, 2010

Posted by comms on 10/13 at 06:39 PM

October 11, 2010
The transportation chief of the European Union said Monday that airlines based in the United States could receive an exemption, at least in part, from European carbon regulations if Washington moved to reduce greenhouse gas emissions at home. European Union officials are trying to persuade airlines based elsewhere to comply with European climate policies. “We are ready to negotiate and to talk about these issues and not only make declarations,” Siim Kallas, the European commissioner for transportation, said during a news conference. “Adequate measures from other countries can be taken into account.” The European Union agreed two years ago to include in the regulations all airlines taking off from, and landing in, the European Union starting Jan. 1, 2012. Full article at New York Times

North America Steps Up Its Effort Against EU ETS

Friday, September 10, 2010

Posted by comms on 09/10 at 03:22 PM

In recent days the United States, Canada and Mexico have urged the International Civil Aviation Organization to pass a resolution stating that countries “seeking to implement an emissions trading system that applies to other contracting states’ aircraft operators” do so only “on the basis of mutual agreement.” In a copy of the submission seen by The International Herald Tribune, the United States, Canada and Mexico acknowledged that pressure was increasing to establish international rules on aviation emissions. But they said there was “no consensus on such a global approach at this time,” adding that disagreement remained among countries on “the application of one state’s emissions trading system to another state’s airlines.” If agreed upon, the resolution would be non-binding. But it would add to international pressure on Europe to at least delay the start of its system. Read the full article in the New York Times

Carbon Traders Speculate on EUR 50 per tonne in 2012

Friday, September 03, 2010

Posted by comms on 09/03 at 12:57 PM

2 Sep 2010
Options to buy European Union carbon permits for 2012 traded in London yesterday at a strike price of as much as 50 euros a metric ton, according to CarbonDesk Ltd and reported on Bloomberg

US continues to oppose EU ETS, pushes for ICAO

Wednesday, September 12, 2012

Posted by Oliver Heaton on 09/12 at 08:29 PM

The US Senate’s Commerce, Science, and Transportation Committee passed a bill on July 31 which may prohibit US airlines complying with the EU ETS. However, before it can even become law it needs to be approved by the whole Senate and then ultimately the President.
 
Given the very controversial nature of this proposal and the current Presidential campaign it seems to us to be unlikely that President Obama would pass any forthcoming bill in 2012. Should he get re-elected we still think it unlikely that he would set a precedent, perhaps a dangerous one, of enacting a law that would prohibit US businesses operating in foreign territories from complying with their laws, especially the laws of more than 27 democratically elected sovereign nations who also happen to be US allies. However, if Mitt Romney becomes President then all bets are off! In such a scenario it could well develop into very damaging trade dispute and even result in seizures of aircraft as bargaining chips. We are completely apolitical, however, it is surprising that such a proposal could be put on the table and partially approved, especially since if the scenario where the other way around and EU countries had proposed a law to ban their airlines from complying with US laws there would understandably be a strong reaction from the US government!
 
Connie Hedegaard who is the EU’s top climate official said via Twitter it was “hard to believe” that the U.S. government “would use a tool that U.S. has only used twice so far: apartheid and anti-Israel boycott.”
Annie Petsonk of the US Environmental Defense Fund and who attended Aviation Carbon 2012 last February said that such a law against EU legislation would “set a terrible precedent.”
Mattias Groote, chairman of the European Parliament’s environment committee, which approved the EU ETS said the “US bill to allow their airlines to flout EU legislation is disrespectful and counterproductive.”
However, to place all of this into context there were high level talks in Washington the previous day comprising 17 nations who re-affirmed their support for the ICAO led proposals for a global ETS for the aviation sector, something which the EU had been waiting for since 1997 and to which they have said on numerous occasions they will hand the airlines over to the scheme whenever it starts.

Meanwhile, away from the political distractions, airlines and operators are trying to make business in a very difficult economic environment and they can certainly do without these kinds of distractions.
  Let’s hope ICAO can agree soon.

NASA chief says carbon price best hope

Wednesday, May 09, 2012

Posted by Oliver Heaton on 05/09 at 11:11 PM

According to James Hansen, the top climate scientist at NASA, the need to put a price on carbon is the world’s best hope at avoiding a scenario of runaway global warming. He has highlighted at the European Geosciences Union meeting last week that that globally government subsidies to oil, gas and coal companies total a massive USD 500 billion per annum and they have impacted an effective transition to alternative fuels and technology. He said “The most efficient and economically affordable approach is to put an honest price on the different energies”. “Presently, we’re subsidising fossil fuels and not making them pay for their costs to society.”

ICAO says airlines may need global scheme in 2015

Friday, April 06, 2012

Posted by Oliver Heaton on 04/06 at 05:16 PM

According to a report by Bloomberg the head of ICAO says that the airline industry may need some form of carbon market beyond 2015. “It’s too early to foretell the outcome of a three-year process ending in September next year that is considering greenhouse-gas trading for the industry.” said Roberto Kobeh “My personal opinion, and a realistic opinion, is that we have to include market-based measures sometime, but I cannot say when.”
An expert group at ICAO have recently narrowed down twenty proposals down to four current contenders:

i) mandatory offsetting, ii) mandatory offsetting complemented by a revenue-raising mechanism, iii) emissions trading cap-and-trade, iv) global emissions-trading baseline and credit system.

EU emissions fall in first half of 2010

Tuesday, August 31, 2010

Posted by comms on 08/31 at 11:27 AM

Overall carbon emissions within the scope of the Aviation EU ETS fell by 1.8 percent in the first half of 2010 compared to the same period in 2009, according to data compiled by consultancy RDC Aviation. Total aviation CO2 emissions across 27 EU states amounted to nearly 113 million tonnes in the first half of 2010 compared with 115 million tonnes last year. The impact of the volcanic ash cloud that severely affected air traffic in northern Europe in April is not easy to measure although the UK and France experienced falls of around 4 percent in emissions over the period, whilst Germany and the Netherlands saw smaller increases in total emissions. This is reflected in airline terms with British Airways and Air France showing decreases in emissions while Lufthansa and KLM had rises. As 2010 is the benchmarking year for calculating the allocation of free emission permits, airlines are perversely incentivized to ensure their emissions are kept high to maximize their share. Continue to read the article at greenaironline.com

EU approves a tool to facilitate ETS compliance

Sunday, July 11, 2010

Posted by comms on 07/11 at 01:53 PM

After many months of waiting the EU Commission has finally released a tool primarily for small emitters to allow them to estimate fuel consumption, hence CO2 emissions, as part of their compliance with the EU Emissions Trading System. The tool enables aircraft operators that qualify as “small emitters” with few flights or emissions to use simplified monitoring procedures. However, the tool can also be used by other larger aircraft operators to also estimate of fuel consumption for specific flights where actual data is exceptionally not available and hence could become an important tool for them.
 
The tool was developed by Eurocontrol and it uses fuel consumption coefficients that are statistically robust and which are believed to have included the input of various aicraft operators to make it more accurate. The tool covers the majority of common aircraft types and it meets the requirements of the monitoring and reporting guidelines for the EU ETS established by the EU Decision 2007/589/EC, with a calculation approach based on individual flights, actual route length and statistically sound fuel consumption relationships.

The tool will undoubtedly reduce the ETS compliance administrative requirements for small operators and perhaps the larger ones. The tool is available for download and use free of charge and a description on how to use it on Eurocontrol’s web site at:  http://www.eurocontrol.int/environment/public/standard_page/small_emitters.html.
 
 

Longest and highest solar powered flight ever…and at night!

Thursday, July 08, 2010

Posted by comms on 07/08 at 10:01 AM

image

The eighth of July 2010 has entered the history books as being an incredible achievement in the advancement of human flight. This morning at a small military airbase in Switzerland an experimental solar-powered aircraft launched on the previous day landed safely after successfully flying through the night. The incredible feat is a step toward the even more incredible aim of circling the globe using only the power of the Sun to fuel the plane.

The aircraft used super-efficient solar cells and batteries to stay in the air after the Sun’s rays had faded. The plane touched down at Payerne airfield at 0900 (0700 GMT) after a total flight time of 26 hours. During the flight it reached a unbelievable height of 8,700 m (28,543 ft). It is the longest and highest flight recorded by a solar-powered plane. The aircraft was steered by Andre Borschberg, a former fighter jet pilot from Switzerland. The plane has 12,000 solar cells arranged on top of its wing which stored enough energy to power the plane for the flight through four engines.

The designers, the Solar Impulse team led by Mr Borschberg and fellow aviator Bertrand Piccard, say that this proves that a plane can be kept in the air around the clock. “Nothing can prevent us from another day and night, and the myth of perpetual flight.” The team will now build a new, more advanced, model of the plane and they plan to aim to circumnavigate the globe by 2013.

Read more about this amazing project at Solar Impulse

JAL achieves Eco-First recognition and pledges a 23 percent improvement in fuel efficiency

Friday, May 21, 2010

Posted by comms on 05/21 at 06:26 PM


image  Fri 21 May 2010 – Japan’s Ministry of the Environment has presented Japan Airlines Group (JAL) with its Eco-First award in recognition of the airline’s various environmental conservation initiatives. The Eco-First programme was established in 2008 to encourage environmental preservation activities by companies in compliance with the Kyoto Protocol. During the past year, JAL has been involved with trialling new advanced flight operational measures and earlier last year conducted Asia’s first sustainable jet biofuel flight. JAL has also made an Eco-First Pledge in which it resolves to achieve a 23 percent reduction in CO2 emissions per revenue-tonne-kilometre (RTK) in 2020 compared with levels in 2005. The Eco-First award commended JAL for its diligence in advocating environmental awareness and for conducting various recycling measures to minimize its environmental burden. Full story at our friends at Greenaironline

Brazilian industry and airlines form biofuel alliance

Posted by comms on 05/21 at 06:23 PM

Thu 20 May 2010 – Following a recent meeting in Sao Paulo, ten organizations have agreed to form the Brazilian Alliance for Aviation Biofuels (Aliança Brasileira para Biocombustíveis de Aviação – ABRABA). They include four airlines – Azul Brazilian Airlines, GOL, TAM and TRIP – as well as aircraft manufacturer Embraer and the Brazilian Aerospace Industry Association (AIAB). Representing the biofuels industry are producers and developers of biomass sources such as jatropha, sugarcane and algae.  The alliance follows an announcement by TAM that the airline will carry out Latin America’s first commercial aircraft biofuel flight during the second half of 2010 using a 50/50 blend of jatropha and conventional jet fuel (full story).

States renew vows to reduce greenhouse gas emissions

Monday, February 01, 2010

Posted by comms on 02/01 at 07:24 PM

Governments around the world have reaffirmed their plans to cut greenhouse gas emissions in support of last month’s Copenhagen climate summit. Nations signing up to the summit accord were urged to outline pledges by Sunday. States producing at least two-thirds of emissions have done so. Correspondents say the accord is widely seen as a disappointment. However, the level of support for it is seen as an indicator of prospects for a legally binding deal later in the year. Read the full article at the BBC

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