Press Release

Issued by European Business Aviation Association.

January 9, 2012

On entry into force of the European Union Emissions Trading Scheme (EU ETS), the business aviation community wishes to renew its support for market-based measures as part of a multi-prong approach to mitigating the rise of carbon emissions and greenhouse gases; however the European Business Aviation Association (EBAA) warns that this support should not conceal the need, largely overlooked so far, for a fair and equitable implementation of the Emissions Trading Scheme.

Indeed the current scheme risks being discriminatory on several grounds:

Firstly, business aviation is treated unfairly compared with other modes of air transport. On average, business aircraft operators must acquire up to 96% of their historical emissions in permits compared with only 15% for airlines. EBAA will therefore continue to push for ways to redress this imbalance, for instance through the consideration of simplified administrative tasks for small emitters. Allowing Eurocontrol's Small Emitters Support Facility for both Reporting and Verification represents a promising means to financially balance this blatant discrepancy.

As stated by Brian Humphries, EBAA President, "It is deeply unfortunate that Member States have so far decided against coupling the small emitters' reporting tool with single point verification. In many cases, for smaller emitters the costs for Monitoring and Reporting, and particularly Verification, far outweigh the costs linked to acquiring CO

2 permits. As such, the MRV procedure threatens to weaken the competitiveness of European business aircraft operators vis-à-vis non-EU competitors and other modes of transport, such as the airlines."

EBAA commends Eurocontrol for the implementation of its ETS Support Facility tool for small emitter operators, and strongly encourages all small emitters within the business aviation community to make use of it. The tool is only as valuable as the data put into it; the more operators who use it, the more powerful and accurate the reports it produces.

EBAA regrets, however, the move only to raise the threshold for smaller emitters from 10 to 25,000 tonnes of CO

2. After all, this threshold certainly does not exonerate smaller aircraft from EU ETS, but simply enables its operators to benefit from a simplified Monitoring and Reporting procedure.

Secondly, the ruling of the European Court of Justice which judged the EU ETS to be valid, stating that it does not infringe on international customary law, is commendable in that it ensures equitable treatment between EU and non-EU stakeholders. Unfortunately though, this only adds fuel to the fire, stirring up a range of protests. China and the U.S. are just two prominent examples. It is questionable whether the mechanisms put in place by the Commission to enforce compliance will be robust enough to resist widespread international resistance.

In order to be successful, EBAA is convinced such a scheme must be enacted globally. International implementation would promote uniform measures and objectives, in contrast to a unilateral EU ETS which will not work over time and will only serve to create new distortions to competition. The coming 12 months will hence prove crucial for the Commission in its quest for international buy-in.

Thirdly, EBAA appeals to all aviation stakeholders who play a key role in minimising aviation emissions. This call to action includes supporting manufacturers and suppliers as they intensify their efforts to explore and implement the uses of biofuels and other innovative fuel alternatives. And it includes urging Member States and the European Commission to do their utmost, despite growing negative signals, to take responsibility and assume their fair share of the environmental effort by delivering on SES II and SESAR, two critical aspects of an environmentally sustainable air transport system.

Finally, in this volatile economic period, the timing of the implementation of ETS and its subsequent financial impact on the air transport industry is particularly delicate. "The year 2011, and one expects the year 2012 as well, had and will record negative air transport figures amidst depressed demand and rising operating costs," says Fabio Gamba, CEO of the European Business Aviation Association. "The EU ETS is predicated on growth, and it becomes redundant if not harmful when growth is negative or lacklustre at best. The EU ETS adds further costs to an already depressed sector and its introduction should have at least coincided with the disposal of national tax schemes that have nothing to do with environmental protection. Instead, we face a steady onslaught of ill-advised initiatives, the latest of which is in Italy where privately owned aircraft will be taxed if they remain on Italian soil for more than 48 hours."