The UN’s civil aviation body reached consensus on 3 October for a roadmap to decide to create a market-based scheme curbing aviation emissions by 2020, but rejected an EU proposal allowing it to apply its Emissions Trading System (ETS) to foreign airlines in the interim.
The agreement by the executive committee of the International Civil Aviation Organization (Icao) emerged after two days of plenary debates and intensive sideline huddles.
Though it still faces a vote today (4 October) by the full assembly of Icao delegates, the most contentious issues have now been addressed.
The resolution sets steps for the Icao's member states to take between now and the next triennial assembly in 2016 to curb growing emissions from the aviation sector.
The committee agreed to "decide to develop a global MBM (market-based mechanism) scheme for international aviation" in 2016, as agreed by the ICAO's governing council in early September.
But the Icao Assembly's president Michel Wachenheim amended the text to reflect requests from developing countries, such as India, to say that the 2016 decision should take into account "environmental and economic impacts" of different global MBM options, “including feasibility and practicability”.
"After some very challenging discussions, including compromises by all parties, ICAO has made a strong commitment in favor of taking multilateral action to tackle climate change," said Todd Stern, the State Department's climate envoy and chief U.S. negotiator.
However, the US-based Envionmental Defence Fund (EDF) called on the US to step up its leadership in the Icao to ensure that the air industry’s emissions were substantially reduced.
“A bedrock principle of international law is that nations have the sovereign right to limit pollution emitted in their borders,” said Annie Petsonk, EDF’s legal counsel, “so ICAO took half a step backward with its attempt to narrow the ambit for countries to implement their own market-based measures.”
European delegation ‘bruised’
It was unclear earlier whether the committee would be able to reach consensus on the global MBM after a group of mostly developing countries voted 97-39 voted to limit the ability of the EU to apply the ETS to international airlines before a global scheme starts.
The EU had insisted that a deal at the Icao should allow it to be able to apply the ETS while countries continued to work toward a global market, but gradually started backing down amid fierce pushback from countries ranging from Argentina to Russia.
Though one European official said that the delegation was "bruised" after the morning vote, a representative of Lithuania – which holds the EU's rotating presidency – praised the final outcome.
"It will allow us to start the negotiations on the global MBM which is the biggest achievement, not only for Europe but for all ICAO members," said Arijandas Sliupas, Lithuania's deputy transport minister.
The EU now must decide whether the deal is strong enough to continue to suspend its legislation, which enables it to apply the ETS to intercontinental flights.
The European Parliament will have to act quickly to endorse any extension of the European Commission's decision to "stop the clock" on its law in time for an April 2014 deadline.
In a preliminary reaction to the Icao agreement, the EU's climate commissioner Connie Hedegaard said: "The EU's hard work is paying off: with this deal on the table, ICAO agrees for the first time to a global way to address aviation emissions: a global market-based measure. We will now look at how to proceed up to 2020 with our EU ETS''
But the Green Party's climate change spokesperson Satu Hassi (MEP, Finland) was less pleased. "Today's outcome confirms the flaws with the EU's strategy in freezing the implementation of emissions trading scheme for non-intra EU flights," she said. "The international aviation organisation (ICAO) is both seeking to block EU action and once more stalling on urgently-needed international measures to address the growing impact of airline emissions on climate change. The EU must now stand firm and stick by its original plans on aviation emissions. We should not dismantle effective climate policy instruments in exchange for a vague promise on a global scheme in the distant future without guarantees of environmental integrity or ambition.
In an effort to tackle aviation's small but fast-growing contribution to climate change, the European Commission issued a legislative proposal in December 2006 to bring it into the EU's Emission Trading System (ETS).
This involved imposing a cap on carbon dioxide emissions for all planes arriving or departing from EU airports, while allowing airlines to buy and sell 'pollution credits' on the bloc's carbon market, and so reward low carbon-emitting aviation.
The legislation took effect on 1 January 2012. But non-EU governments and airlines have threatened legal action or trade retaliation unless they are granted exemptions. China's official aviation body, the China Air Transport Association (CATA), says that the ETS would cost its airlines $123 million in the scheme's first year, and more than triple that by 2020. The country also claims special dispensation as a developing country.
EU officials say that China has a higher GDP than Greece or Portugal and question why its businessmen should be exempted from paying the same carbon taxes that others do.
The EU also allows ETS exemptions for governments that take equivalent measures to curb aviation emissions. But Brussels has not said what these might be. China's aviation regulator has already asked all airline carriers to cut their energy and carbon intensity by 22% by 2050.