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​Future of EU ETS: towards an airspace based approach?


Today, there was an evening roundtable about the future of Aviation in the EU ETS at the European Parliament (EP) in Brussels organized by MEP Dr Peter Liese. Jos Delbeke, Director-General for Climate Action at the European Commission (EC) was also present. Julien Dufour, CEO of VerifAvia, attended the meeting.

Both Dr Liese and Mr Delbeke expressed optimism that an acceptable agreement about a global Market-Based Mechanism (MBM) might be within reach at the 38th ICAO General Assembly that is due to start on 24 September in Montreal, Canada.

Indeed, the latest draft ICAO resolution would allow States or groups of States (such as the EU) to implement a regional scheme limited to the airspace of the States or group of States until a global MBM is implemented in 2020. This would be a compromise that nobody is really happy about but that at least no party would strongly oppose. 

Considering that the EU ETS might collapse without an agreement, this emerging compromise appears to be a major relief for the representatives of the EC and the EP as it would resolve the sovereignty issue which has been the main international argument against the EU ETS.

In practice, this would mean that the EC would be allowed by the ICAO resolution to continue with the EU ETS as long as it is restricted to the aircraft emissions within the EU airspace. This might take the form of a 'stop-the-clock +' where the derogation would concern the emissions of the portion of extra-European flights outside of the EU airspace. In other words, EU ETS would include the emissions from intra-European flights (as always) as well as the emissions from extra-European flights but only the portion of the flights that is within the EU airspace.

Since the following ICAO assembly is scheduled in 2016, the new 'stop-the-clock +' proposal might cover the 2013, 2014 and 2015 monitoring periods with a provision to return to the full scope of EU ETS in 2016 if there is not enough progress towards a global scheme.

However, it is important to bear in mind that negotiations are still continuing and the draft resolution could still be changed right up to its approval at the ICAO Assembly. Neither ICAO nor the EU have formally taken any decision yet and anything can still happen. 

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