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Airline industry to be included in the ETS as of 2012 – EU urges the industry to play its part in the fight against climate change

The Member States of the EU showed overwhelming support for the Slovenian Presidency's proposal on the inclusion of aviation in the European ETS (Emissions Trading Scheme) system when they rubber stamped the agreement last week.

"Hence, the Slovenian Presidency managed to arrive at an agreement on one of the most challenging dossiers, which is closely linked with Europe's overall aim to fight climate change," stated the President of the Environment Council and Slovenian Environment, Minister Janez Podobnik, following the agreement reached on Friday (27 June) by Deputy Permanent Representatives.

According to the preliminary agreement with the European Parliament, which is scheduled to vote on this dossier on 9 July, aviation will be included in the ETS from 2012 onwards. Moreover, a cap (i.e. the quantity of aviation allowances allocated each year to airlines) has been set at 97 percent for 2012 (the so-called first period), which then decreases to 95 percent for the second period (2013–2020) based on a calculation of average emissions in the base years 2004–2006. This is subject to change if there is a different agreement in the ETS Directive (part of the Climate and Energy Package).

The agreement foresees that only 15 percent of allowances for emission are to be bought at auction by airlines taking off or landing in the EU between 2012 and 2020 (meaning that 85 percent will be free), also subject to a general review of the ETS Directive. These revenues are to be used to tackle climate change in the EU and in third countries, including measures to reduce greenhouse gas emissions and to fund research and development for mitigation and adaptation in the aeronautical and low-emissions transport field. While the precise amount to be used for these measures has not yet been set, revenues must be used to fight climate change, and the Member States are required to report to the Commission on the use of these revenues.

"These measures should by no means hurt passengers, as the industry claimed in its initial response to the news of the agreement. A tonne of CO2 costs around 30 euros today. This means that the additional cost per passenger would be around 5 euros on a round trip ticket for a European flight, 9 euros for a medium-haul flight and around 40 euros for a long-haul flight, according to the Commission's impact assessment analysis," explained Minister Podobnik, adding that "the industry should now focus on its role in making flights as fuel- and cost-efficient as possible. They should invest in a new generation of engines and planes. In an age of high fuel costs, when the EU is working hard to minimise the negative impact of high prices on consumers, the airline industry should do the same. How else can they stand up and claim that they are serious about climate change, as the European Union declared by agreeing in March to have a comprehensive agreement on climate change and energy in place before the end of 2008."


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Date: 30.06.2008