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“STAKEHOLDEROVERLEG” Conscience gebouw, Brussel, 19 juni 2007

“STAKEHOLDEROVERLEG” Conscience gebouw, Brussel, 19 juni 2007 “THE INCLUSION OF AVIATION IN THE EU ETS, A PERSPECTIVE FROM THE AVIATION SECTOR ” Koen VERMEIR Director Aeropolitical Affairs IACA, SPEAKING ON BEHALF OF. A MULTI-ACTION STRATEGY.

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“STAKEHOLDEROVERLEG” Conscience gebouw, Brussel, 19 juni 2007

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  1. “STAKEHOLDEROVERLEG” Conscience gebouw, Brussel, 19 juni 2007 “THE INCLUSION OF AVIATION IN THE EU ETS, A PERSPECTIVE FROM THE AVIATION SECTOR” Koen VERMEIR Director Aeropolitical Affairs IACA, SPEAKING ON BEHALF OF

  2. A MULTI-ACTION STRATEGY • THE EUROPEAN AVIATION SECTOR TAKES ITS ENVIRONMENTAL RESPONSIBILITY VERY SERIOUSLY • 2005 : EUROPEAN AVIATION INDUSTRY EMISSIONS CONTAINMENT POLICY

  3. A MULTI-ACTION STRATEGY AVIATION EMISSIONS TO BE TACKLED THROUGH • TECHNOLOGICAL PROGRESS • INFRASTRUCTURE IMPROVEMENTS • FULL IMPLEMENTATION OF THE SINGLE EUROPEAN SKY WOULD REDUCE EMISSIONS BY UP TO 12% • OPERATIONAL BEST PRACTICE • EMISSIONS TRADING SCHEME (ETS) AS THE MOST COST-EFFECTIVE ECONOMIC INSTRUMENT

  4. EC ETS PROPOSAL - POSITIVE ELEMENTS • OPEN SYSTEM • POSSIBILITY TO TRADE WITH THE OTHER SECTORS • ACCESS TO CDM & JI • CO2 ONLY • NO MULTIPLIER FACTOR • NON-CO2 EFFECTS TO BE TACKLED OUTSIDE ETS • NON-DISCRIMINATION BETWEEN OPERATORS • INCLUSION OF ALL OPERATORS WITHIN THE DEFINED GEOGRAPHICAL SCOPE • HARMONISED PROCEDURE AT EU LEVEL FOR THE ALLOCATION OF ALLOWANCES

  5. EC ETS PROPOSAL - POINTS OF CONCERN • BASELINE OF 2004-2006 • TOO DISTANT FROM TRADING PERIOD • NEW EU MEMBER STATES PENALISED AS THEIR BOOMING MARKET IS NOT TAKEN INTO ACCOUNT • UNAVAILABILITY OF ACCURATE BASELINE DATA • EMISSIONS CAP – STABILISATION AT 2004-2006 LEVELS • ANY GROWTH ABOVE THE CAP WILL HAVE TO BE PURCHASED : • 30% OF EMISSIONS BY 2012 (*) • 50% BY 2017 • 70% BY 2022 (*) Including auctioning

  6. EC ETS PROPOSAL - POINTS OF CONCERN • AUCTIONING • MANDATORY FOR AVIATION • BUT APPLICATION TO GROUND SOURCES LEFT TO MEMBER STATES TO DECIDE • RELATIONS WITH 3rd COUNTRIES • ACCEPTANCE OF THE EU ETS ? • LEGAL ASSESSMENT ?

  7. ERNST & YOUNG IMPACT ASSESSMENT OF THE COMMISSION’S ETS PROPOSAL • COST OF BUYING CO2 ALLOWANCES TO COVER THE GROWTH ABOVE THE CAP : • ADDITIONAL COSTS : € 45 BILLION (2011 - 2022) • i.e. € 4 BILLION PER YEAR • IF PARTIAL AUCTIONING : € 65 BILLION (2011-2022) • IMPACT ON AIRLINE PROFITABILITY : • AIRLINES WILL HAVE TO ABSORB 2/3 OF THE COSTS • LOSS OF DEMAND RESULTING FROM PRICE ELASTICITY • POTENTIAL LOSS : € 40 BILLION (2011 – 2022)

  8. ERNST & YOUNG IMPACT ASSESSMENT OF THE COMMISSION’S ETS PROPOSAL • IMPACT ON EMPLOYMENT : • 42.000 JOBS LESS, COMPARED TO BUSINESS-AS-USUAL • IMPACT ON THE EUROPEAN ECONOMY : • REDUCED CONSUMER CHOICE IN RANGE AND FREQUENCY OF AIR SERVICES • ADVERSE EFFECTS ON • REGIONS AND REGIONAL AIRPORTS • TOURISM TO PERIPHERAL REGIONS

  9. EUROPEAN AVIATION INDUSTRY REQUEST THE EUROPEAN AVIATION INDUSTRY CALLS UPONTHE EUROPEAN PARLIAMENT AND THE COUNCIL TO • PRESERVE THE POSITIVE ELEMENTS OF THE PROPOSED ETS • IMPROVE THE BADLY DESIGNED ELEMENTS • PREVENT INTERNATIONAL DISPUTES • ACCELERATE THE IMPLEMENTATION OF THE SINGLE EUROPEAN SKY POLICY SO AS TO ENABLE THE EU TO MEET ITS TARGETS UNDER KYOTO WHILST MAINTAINING INDUSTRY COMPETITIVENESS UNDER THE LISBON AGENDA

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