The government of the United States and airlines from both inside and outside the European Union are intensifying their lobbying against the inclusion of aviation in the EU's emissions trading scheme (ETS) from 1 January.
According to an EU law passed past three years ago, with effect from 1 January 2012 the carbon emissions of all flights going in and out of EU airports will need to be offset through the purchase of allowances. International airline associations and the US government are arguing that non-EU airlines should not have to buy the allowances.
In retaliation against the EU measure, the US House of Representatives has passed a bill that would prohibit US airlines from participating in the ETS. The bill will not be approved by the Senate before 1 January because of a legislative backlog, but it has bipartisan support, and President Barack Obama has indicated that he will sign it once it has passed. That would precipitate a trade war, since the EU legislation prohibits airlines that do not participate in the ETS from using EU airports.
A group of US airlines has challenged the law at the European Court of Justice (ECJ). They are hoping that the judges will issue a ruling in their favour today (21 December), by finding the inclusion of foreign airlines in the EU's ETS illegal under international law. But this is unlikely given that the court's advocate general issued an opinion in October siding with the EU, and the court rarely contradicts these preparatory opinions.
The US State Department and the airlines have indicated that they will not be deterred if the ECJ judges do not support their argument. The Association of European Airlines (AEA) said the EU must respond to the concerns regardless of today's ruling, so as to avoid a trade conflict that could seriously damage Europe's aviation industry. “Even if the ECJ decides that the EU ETS conforms with EU law, this will not resolve non-European countries' vehement hostility towards the way EU ETS was introduced globally,” said Ulrich Schulte-Strathaus, secretary-general of AEA.
Hillary Clinton, the US secretary of state, sent strongly worded letters at the weekend to José Manuel Barroso, the president of the European Commission, Catherine Ashton, the EU's foreign policy chief, and Connie Hedegaard, the European commissioner for climate change. She threatened retaliatory action, saying that the US would be “compelled to take appropriate action”, though she did not specify what that action would be. She gave no deadline for the EU to cancel the inclusion of foreign airlines in the ETS, but warned that the EU had become “increasingly isolated” on the issue, pointing out that China, Brazil, Russia and Japan are also opposing the inclusion of non-EU airlines.
Siim Kallas, the European commissioner for transport, questioned the logic of US demands to delay the 1 January start date, since initially the emissions are simply measured. The airlines will not actually have to buy allowances until April 2013.
Peter Liese, a German centre-right MEP, described the US objections as hypocritical, saying that the US had not raised objections to being covered by national carbon taxes in Germany, Austria and the UK. “The position of the US airlines is disproportionate to the price,” he said, estimating that the ETS would cost €0.45 per person for a flight from Frankfurt to New York, whereas the German tax is €45.