Controversy over EU’s ETS continues
The ongoing international furor over the European Union’s Emissions Trading Scheme (ETS) continues to heat up with the potential of official sanctions increasingly being bandied about and talk of unofficial sanctions already being leveraged against European companies. Donald Urquhart reports.
October 4, 2012
By Donald Urquhart
European Union officials said recently they will negotiate with international partners angry at what they see as a climate tax on airlines, but refused to change the hotly disputed Emissions Trading Scheme (ETS). “We have always been open to continuing discussions on the possibility of equivalent measures” outside Europe, Isaac Valero, spokesman for European Union climate action commissioner Connie Hedegaard, told AFP. “This way we hope to reach a global agreement,” he said, referring to a longstanding failure to bring industrialised and emerging powers onto the same page over environmental objectives for big industry. “But awaiting this global agreement, we are not going to change our legislation,” he underlined. The international community responds While a group of nearly 29 countries met in Moscow in February, with 25 signing the Moscow Declaration detailing potential punitive actions against the EU, at least two countries have come out strongly against the scheme by barring their domiciled carriers from participating in the ETS.
The US is in the process of enacting legislation making it illegal for its carriers to participate, while China has banned its carriers from taking part without its consent and similarly India is poised to ask its carriers not to take part as well. If the European Commission retaliates by suspending Indian airlines from flying to Europe, India would make similar moves and consider charging an “unreasonable” amount for flying over India, said an unnamed senior government official according to Indian media reports. “We have lots of measures to take if the EU does not go back on its demands. We have the power of the economy; we are not bleeding as they are,” the unidentified government official was quoted as saying. China, meanwhile has said it will continue to push the EU to axe the scheme, but said it was not planning to take retaliatory measures, according to Li Jiaxiang, chief of China’s Civil Aviation Administration. Li said the plan would raise annual costs for China’s airlines by 800 million yuan ($127 million) initially, before rising to three billion yuan by 2020 and 18 billion yuan by 2030. “We are taking positive measures of talking via the International Civil Aviation Organisation and other bodies to promote cooperation and reconciliation,” he added. “We appreciate the EU’s intention to protect the environment, but measures must be reasonable and acceptable for other countries,” Li said.