ELFAA EU EMISSIONS TRADING SCHEME
July 2008
ELFAA was concerned at the readiness of the European Parliament’s Environment Committee and the EU Presidency to come to a provisional compromise agreement regarding the inclusion of aviation in EU ETS at their meeting of 26 June.
In particular, ELFAA was shocked at the failure of the parties to take into account the dramatic shifts in the assumptions, which formed the backcloth to the original legislative proposal of the Commission for the inclusion of aviation in EU ETS:
a) since the Commission produced its original proposal in December 2006, the price of oil has more than tripled to SD 140 per barrel;
b) in addition, the price of a tonne of CO2 in the carbon market has already reached the extreme high level of the range, considered likely by the Commission in its Impact Assessment.
Despite the sky-rocketing price of aviation fuel battering airlines, with over twenty bankruptcies so far this year, the parties agreed provisionally a compromise proposal for an initial 15% auctioning of allowances – an at least five-fold increase over the level proposed by the Commission.
ELFAA has to date lent its support to the proposed inclusion of aviation in EU ETS, subject to the design of the scheme being such as to reward good and penalise bad environmental performance. The environmental objectives of the scheme derive from the fixing of a cap (based on 2004-06 actual emissions) and the award of allowances ithin this industry cap on the basis of environmental performance benchmarking.
Auctioning brings no environmental payback and should be seen instead for the punitive tax it really is. ELFAA urges the Parliament and the Council to reject the proposal to auction allowances, which would do no good for the environment, yet wreak untold havoc on the economics of the airline industry, which is already struggling to cope with he unprecedented rise in the price of aviation fuel.
clickair | easyJet | flybe | Jet2.com | Myair.com | Norwegian | Ryanair | Sky Europe |Sterling | Sverige Flyg | transavia.com | Wizz Air
www.elfaa.com
European Low Fares Airline Association Newsletter July 2008
Go to top
Print Page
Smaller
