European Union Emission Trading Scheme

[Jordan-34092]

Well it looks like the EU bright Ideas could have a serious impact on the United Kingdom's Aviation Industry, Non-EU Based Airlines are in talks of not introducing new routes with possibility of Pulling some routes too, along with countries not in the EU banning European based airlines flying through their airspace.

[textarea]New routes threat from ETS opponents


Countries opposed to the European Union’s emissions trading scheme (ETS) could ban its airlines from taking part or refuse to discuss new routes with European carriers.

The two options are part of a “basket” of measures agreed at a meeting in Moscow of 26 nations opposed to this year’s introduction of ETS for airlines flying in and out of airports in the EU.


Russia, US, China and India were among the nations taking part in this week’s meeting to decide on the next steps against the EU’s stance on including aviation within ETS.

Other measures which the 26 countries could take include the imposition of retaliatory taxes on EU airlines and lodging formal complaints with the UN’s International Civil Aviation Organisation (ICAO).

But the countries have not vowed to take joint action as each government will decide which method of protest against ETS they will adopt individually.

Russia’s deputy transport minister Valery Okulov told a press conference in Moscow: “Every state will choose the most effective and reliable measures that will help to cancel or postpone the implementation of the EU ETS.”

Russian officials also said it was considering a ban on its airlines taking part in ETS – China has already ordered its airlines not to take part. Russia could also impose limits on EU-based airlines flying through its Siberian airspace.

EU officials have said they may be willing to “moderate” their stance on ETS if a deal for a global system can be reached through ICAO. The EU will not start collecting permits for CO2 emissions made by airlines until April 2013.

The countries opposed to ETS are planning to meet again in the summer in Saudi Arabia, according to reports.

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This is something UK regional airports such as NCL, LBA, EMA, BRS, BFS, ABZ & HUY need at this time, especially as they were already struggling to get new airlines into the airports and current airlines to expand.

The bid for a New York service from LBA & NCL is going to have been for nothing if this is the case.

 

[TheLocalYokel]

Posturing at this stage. Neither side can afford to have a full-blown aviation routes war.

At least we don't give financial aid to Russia and China any more - why did we ever?

About time India's aid was stopped too. If it can afford a space programme it can afford to look after its citizens who suffer deprivation.

This is the sort of thanks you get.

 

[Jordan-34092]

Countries unite to fight EU emissions trading scheme


A 32-nation conference has agreed to push Europe to drop emissions trading scheme (ETS), and a majority of countries signed a declaration opposing it, the China Daily News reports. All airlines using EU airports, from this year, are required to buy permits under the ETS. Those who fail to comply face fines and could be banned from flying to the EU. China has banned its airline from entering the ETS, with other countries including the US against the scheme.

Thirty-two countries, including China, the United States, Brazil, India, Japan, Singapore, South Africa and Argentina, participated in the international conference on cutting greenhouse gas emissions in Moscow this week. Twenty-nine of the countries signed a joint declaration opposing the European scheme.

The declaration envisages a range of measures including barring national airlines from participating in the ETS, lodging a formal complaint with the United Nations' International Civil Aviation Organization, ceasing talks with European carriers on new routes and imposing retaliatory levies on EU airlines.

Ji Yuan, a deputy director at the planning and development department of the Civil Aviation Administration of China, said: ‘(Charging emission fees on international aviation) is a multilateral issue, but the EU breached this principle of handling international matters. All participating countries agreed that the EU should drop its unilateral methods and return to a multilateral discussion to solve the emission issue. The conference has achieved its purpose. It will send a strong signal to the EU.'

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Well this is going to be interesting because i doubt EU airports will want to loose airlines through this.

 

[Jordan-34092]

Hong Kong Air May Cancel A380s Over ETS


Hong Kong Airlines has threatened to cancel an aircraft order with Airbus due to growing tensions between China and the European Union over the bloc's emissions trading scheme, a local newspaper reported on Thursday.

The Hong Kong-based regional carrier, which is backed by China's fourth-largest carrier Hainan Airlines, said it was under pressure to cancel its order for 10 Airbus A380 aircraft with a list value of USD$3.8 billion, the South China Morning Post said.

"We cannot do something which is against our country's interests," the newspaper quoted airline President Yang Jianhong as saying.

China has previously threatened to hold back on purchasing Airbus aircraft in retaliation against the airline emissions fee scheme.

"I cannot confirm this and I have no comment on this," said Kenneth Thong, Hong Kong Airlines head of corporate governance and international affairs.

This will be the second time that Hong Kong Airlines’ A380 deal was at risk of being derailed by the dispute between the European Union and China.

"Hong Kong Airlines had indicated to delay or withdraw the acquisition of A380s before but it signed an order eventually," said Kelvin Lau, an aviation analyst at Daiwa Securities.

Chinese Foreign Ministry spokesman Hong Lei repeated China's opposition to the EU's plans at a daily news briefing on Thursday.

"The facts show that Europe's actions are unpopular, and will have no effect," he said. "We hope that Europe can face squarely the international community's concerns and devote themselves to solving the issue not further complicating it."

Plans to announce the high-profile A380 deal between Airbus and Hong Kong Airlines were called off at the Paris Airshow last June because of China's anger over the emissions trading scheme, industry sources said.

Hong Kong Airlines only confirmed its order for the double-decker A380 months afterwards.

DELIVERY ON SCHEDULE

China Southern Airlines is the only mainland Chinese airline that has ordered the A380 so far. Two of the five planes it ordered are already in service on the Beijing-Guangzhou route.

"The third A380 is arriving today and will start serving the Beijing-Hong Kong route tomorrow. There is no plan to cancel the other two," a spokesman at the airlines said.

Analysts said the Airbus-Boeing duopoly in the supply of larger commercial aircraft left China with little choice but to rely on the European and US firms to feed its fast-growing demand for civil aviation.

In February, China banned its airlines from participating in the European Commission's airline emissions trading scheme without approval, saying it violated international law.

China's four biggest airlines, Air China, China Eastern, China Southern and Hainan Airlines would also consider taking legal action against the EU over the move to charge for carbon emissions on flights to and from Europe, according to the China Air Transport Association.

The holding company that controls Hong Kong Airlines counts Hainan Airlines and Hainan Airlines' parent HNA Group among its biggest shareholders.

The carrier, which had a fleet of 14 aircraft including six A330-200s and eight Boeing 737-800s, was taking delivery of eight to 10 aircraft this year, its spokeswoman told reporters in January.

It operates scheduled flights to 10 cities in China and other parts of Asia and Europe, including Indonesia, Japan, Singapore, Thailand, Vietnam and Russia.

The carrier has said it would start daily flights between Hong Kong and London in March, but the ETS scheme would not have a big impact on its customers and the airline as the flights would be all-business class.

The scheme, which levies charges for carbon emissions on flights in and out of Europe, has also drawn the ire of other countries, including the United States and India.

Foreign governments argue that the EU is exceeding its legal jurisdiction by calculating the carbon cost over the whole flight, not just Europe.

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[Jordan-34092]

'ETS must be suspended' – Lufthansa boss

Source

Lufthansa’s boss has called for the EU emissions trading scheme (ETSEmissions Trading Scheme: Effectively an emissions market where allowances are traded as units of volume e.g. one tonne of carbon dioxide. Participating companies are allocated a number of allowed emissions units of each gas. A company may emit more by purchasing units from the market. Similarly, a company may sell units if they are in excess. The total number of allocation units is fixed and regulated by central and EU government. An ETS imposes a limit on the total emissions according to reduction targets, while allowing companies flexibility. (Source: www.defra.gov.uk)) to be suspended until it can be introduced globally and not just in Europe.

ETS was introduced for all airlines flying in and out of airports in the EU from January 1 but major non-EU nations including Russia, the US, China and India have threatened sanctions against European carriers in protest about the scheme.

Lufthansa’s CEO Christoph Franz said: “If we must have ETS, then it must be introduced worldwide, and not distort competition for Europe alone.

“That was what the German government agreed and repeatedly promised. If this cannot be ensured, then ETS must be suspended until we can find a conclusive solution.

“The introduction of ETS now threatens to result in exactly what we had feared: a double penalisation of the EU airlines with possible retaliatory acts in non-European countries.”

Franz made his comments as Lufthansa released its annual report for 2011 which confirmed financial results showing that the group made a loss of €13 million last year – partly due to €285 million in costs from Bmi which Lufthansa is in the process of selling to British Airways’ owner IAG subject to getting clearance from the European Commission.

Franz also called for Germany’s air traffic tax to be abolished and added “under no circumstances can we have both the German air traffic tax and EU ETS at the same time”.

“We want to be successful in competition, but the structures and conditions in our home market of Europe must be right and not work against us,” he urged.

Franz also said that it was difficult to predict how Lufthansa, which also owns Austrian, Swiss and Germanwings airlines, would fare in 2012 due to uncertainties over the global economy and rising oil prices.

“Unfortunately, the situation in the global economy means that the outlook is currently rather subdued,” he said.

“The unresolved debt problems of certain countries and the resulting implications for the banking sector, as well as the dramatic rise in the oil price during recent weeks, are contributing to the uncertainty, which we are also feeling in our business.”

Franz added that a “well-founded forecast for 2012 is not yet possible” but Lufthansa is predicting an operating profit in the “mid three-digit million euro range”.

 

[Jordan-34092]

The slow burning fuse of ETS


The controversial decision by the EU to go ahead unilaterally and include aviation in its emissions trading scheme is storing up trouble for European airlines, says Stanley Slaughter.

When the European Union passed legislation, in 2009, to include aviation in its emissions trading scheme (ETS), it would have been well aware it was potentially storing up trouble for itself. The decision was a unilateral one, not backed by many countries outside the EU but requiring all airlines flying into EU space to comply with the measure.

It was not long before countries such as Russia, China, India and the US and airlines including three of the biggest American carriers, United, Continental and American made known both their displeasure at and opposition to the EU’s decision to go it alone.

All made it clear they wanted a global agreement to measure and curb aviation’s CO2 emissions. But the EU, doubtlessly buoyed by the decision of the European Court of Justice (ECJ) late last year that its scheme was perfectly legal, stuck to its plans to make aviation part of its ETS from January 1, 2012.

The scheme is now, officially at least, in operation. Under it, all airlines flying in or out of the EU bloc (this includes not only the 27 members but also Iceland, Norway and Liechtenstein) will be given a set level of C02 emissions a year, called allowances.


Airlines below their allotted level can either sell its surplus allowances to any other participants in ETS or it can store them for future use. If it is in danger of going over its set level, it can either take steps to cut its emissions for that year or buy allowances from organisations/airlines/companies which have a surplus of allowances.

The crunch is due to come on April 30, 2013, when all airlines flying to or from the EU bloc, are required to submit details of their CO2 emissions. This requirement is not likely to be met fully as - for one - the China Air Transport Association has told its members, who include Air China, China Southern Airlines, China Eastern Airlines and Hainan Airlines, not co-operate with scheme. Other countries have made similar noises. In response the EU has promised fines for those not complying.

This standoff has led to an element of panic among some European airlines, including BA, Iberia, Air France, Lufthansa and Virgin Atlantic. Their CEOs have written to their respective country’s head of government to warn about a potential trade war with opponents of the EU scheme launching “counter-measures and restrictions”against EU carriers.

It has all the feel of an accident waiting to happen.

It is easy to sympathise with the EU’s wish to curb CO2 emissions in aviation. The industry is expanding at a considerable rate and with it, its volume of carbon gas emissions. And why should aviation be excluded from the ETS when other industries have been subject to it for years?

But the decision to proceed unilaterally was an astonishing risk. Countries with far less commitment to combating global warning than the EU were never going to take kindly to this move. Nor were countries, regardless of their attitude to global warning be ready to have their sovereignty infringed by dictats from the EU.

But sympathy for those opponents has to be strictly limited. It is nearly three years since the EU announced its intentions, giving opponents plenty of time to come up with an acceptable alternative. Of course they have not done this.

It is generally agreed and quite obvious that what is needed is a global scheme which all countries and airlines can sign up to. For instance - one promoted by the UN body, the International Civil Aviation Organisation (ICAO) which is the global forum for civil aviation. Opponents of the EU scheme have said exactly this a thousand times.

One of the reasons why the EU went ahead alone was that it believed that if it waited for the ICAO to do anything, it would be kicking its heels for years, which has proved to be true.

The response of the opponents of the EU scheme has been entirely negative. They have held meetings in Delhi last year and Moscow last month with a further gathering planned for Saudi Arabia this summer.

All these first two meetings have done is threaten reprisals against the EU. They have produced nothing positive nor constructive. No doubt the Saudi meeting will result in more of the same.

However something at last may be happening. The ICAO has appointed what it describes as “a high level dedicated group to propose a global framework for international aviation emissions by the end of this year."

This is the most positive response yet. While not advising anyone to hold their breath, it would be good to believe that something concrete might emerge by early 2013.

If not, then a clash between the EU and some of the world’s most powerful countries and airlines looks highly possible. This would be bad enough in itself as no one would win. It is made doubly worse by the knowledge that there is absolutely no need for it to happen.

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[TheLocalYokel]

EU/European Court and good sense is an oxymoron.

But the EU, doubtlessly buoyed by the decision of the European Court of Justice (ECJ) late last year that its scheme was perfectly legal, stuck to its plans .............

Crikey, a decision by the European Court ...........................that'll put the frighteners on the rest of the world.

We're the only country stupid enough to obey that Court's enjoinders to the letter.

 

[Jordan-34092]

EU/European Court and good sense is an oxymoron.

But the EU, doubtlessly buoyed by the decision of the European Court of Justice (ECJ) late last year that its scheme was perfectly legal, stuck to its plans .............

Crikey, a decision by the European Court ...........................that'll put the frighteners on the rest of the world.

We're the only country stupid enough to obey that Court's enjoinders to the letter.

I though the whole EU obeyed it?

 

[TheLocalYokel]

No smiley so not sure if that's tongue-in-cheek.

Many if not most European countries obey those parts of European Court edicts they find convenient, or not inconvenient is a more accurate term, and quietly turn the Nelsonian Eye on those they find disagreeable.

 

[Jordan-34092]

Ahhh I see, no I wasnt so sure.

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