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ETS: latest developments in aviation and shipping

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Further to the meeting in Moscow on 21 February 2012 (see February 2012 Eurobrief) regarding the inclusion of aviation in the EU-ETSi, China is blocking contractors purchasing planes manufactured by Airbus, an EU aircraft manufacturer. This is, according to EADS’ (Airbus’ parent company) chief executive, Louis Gallois, although China has not officially confirmed that this is a retaliatory measure. On 29 March 2012 Airlines for America (A4A), the association of major US carriers dropped its private lawsuit against the inclusion of aviation in the EU’s ETS, relying on the efforts by the US government to overturn the EU policy. The European Commission nevertheless continues to maintain bilateral discussion with non-EU countries opposed to the inclusion of international aviation under the ETS. It is also pressing for progress on a global solution to this issue within the International Civil Aviation Organisation (ICAO).

In the EU, several of Europe’s biggest aviation groups have highlighted the potential damage to their competitiveness as a result of the retaliatory measures. Nevertheless, their call for airlines to be exempt from the EU-ETS have been rejected by the European Commission.

In relation to emissions from shipping, the Marine Environment Protection Committee (MEPC) of the International Maritime Organization (IMO) held its 63rd session at the end of February/beginning of March 2012. Although a number of proposals for market-based measures (MBMs) were considered during the meeting, ranging from a contribution or levy on all CO2 emissions from international shipping via emission trading systems, to schemes based on a ship’s actual efficiency, the committee was unable to make “tangible progress”.

The European Commission’s proposal for the inclusion of shipping under the EU-ETS is scheduled for release at the end of 2012. Shipping emissions represent 3% of global emissions, compared to 2% for aviation.

More information: February 2012 Eurobrief