India Leads EU Airline Levy Opposition

India has gathered with more than 30 nations to create a strategy to oppose the European Union’s Emissions Trading Scheme (EU ETS), which will begin imposing charges on carriers that fly into the 27 member states at the turn of the year. Indian civil aviation minister Vayalar Ravi questioned how the EU can dictate terms to other nations. He also questioned why everyone would simply accept that.

The EU made the decision in 2008 that airlines should become part of its ETS after discharges in Europe grew twice over in 20 years. It says emissions from international carriers now account for 2%-3% of global greenhouse gas discharges. The programme already covers more than 11,000 power stations and factories located within the EU.

Airlines that fly into the EU will be made to purchase carbon permits from January 2012 if they exceed the emission caps set by the group of member states. Under the scheme, 85% of the emission cap for airlines will be allocated free, and the balance will be auctioned next year. These benchmarks were set this week. European Commission director-general for climate Jos Delbeke says the cost to meet emissions targets could increase airfares for transatlantic services by between €2 and €12.

Measures by the EU to impose the carbon caps have garnered protests from airline groups in the US, China, Russia and the Middle East. In June, the China Air Transport Association said that the plan is illegal and unreasonable. The International Air Transport Association (IATA) said earlier this week that it’s the EU’s plan to break international law and attack the sovereignty of other nations. Chief executive Tony Tyler said that the legislation will add $1.2 billion to airline costs next year. The organisation has forecasted carriers to make only a combined $4.9 billion profit for the year.

Over 30 members of the International Civil Aviation Organization (ICAO) met in New Delhi this week to discuss the EU ETS. The group has 190 members states, including China and the US. Ravi said that his country’s aviation ministry was hosting the two-day meeting, but he didn’t name any of the nations that were to participate. He has called the ETS a penalty on all foreign airlines operating to Europe. The aviation industry is growing in India, and they can’t be penalised for that, he added.

Binit Somaia, the director of South Asia for the Centre for Asia Pacific Aviation (CAPA), said that, by making the ETS apply to non-EU carriers, there is a feeling that the EU is stepping over its authority. Retribution may take the form of equivalent retaliation of taxes, restrictions on traffic rights for European airlines and an impact on European planemakers.