European Airlines: The Cost of Clean Air

The European Commission has accused several airlines of not following a new European law that requires them to account for their greenhouse gas emissions. Non-compliance could eventually lead to these airlines being banned from European airports. While this is not seen as very probable, it could have dire effects on world travel, the European airline market, and the global economy.

China, among other countries, has been fiercely opposed to the new law, which went into effect at the start of 2012. This has been the European Union’s boldest move to protect the environment, and involves trading emission permits in the EU’s Emissions Trading System (ETS). Carbon trading systems like the ETS can be found all over the world. They are a way to combat excessive carbon emissions by providing businesses economic incentives to decrease emissions. It involves airline companies buying and selling permits or “carbon credits” that allow for a set amount of greenhouse gas emission.

A European ban on noncompliant airlines is seen as an option of very last resort, and is not very probable. Airlines would initially face fines for not following set emission guidelines, and authorities are confident that companies will begin to comply once fines have been assessed. However, the fact that the EU is threatening a ban is very noteworthy. It shows that they are very serious about implementing and enforcing their new emission initiatives. This is seen as a significant first step in increased regulation and greener practices within the industry.

Opponents of the system, including airlines in China and the United States, will likely have to compromise with European authorities in order to avoid escalating to a trade war. The US House of Representatives recently approved a bill that would ban American carriers from participating in such a system. However, the European Court of Justice rejected a complaint by a group of US airlines that argued that requiring them to participate in the ETS conflicted existing international aviation treaties.

Airlines will not need to actually purchase permits to account for their emissions until Spring 2013, so there is still another year for a compromise to be found. Do you think that it is the airlines responsibility to keep the skies clean? Or do you feel as if the cleaner emissions guidelines are unjust for the industry?