- European Commission proposal to extend EU ETS beyond EU borders faces opposition
- Only 13pc of airlines’ ETS payments would be recycled into SAF support under proposal
- More than four times proposed amount needed to cover SAF cost gap
- Non-CO₂ effects including contrails better addressed through airspace policy
- CORSIA should remain primary mechanism for international aviation emissions
Kenton Jarvis of easyJet told A4E briefing in Brussels he is opposing the European Commission proposal to extend EU ETS scope beyond EU borders. The Brussels briefing has heard that CORSIA should remain the primary mechanism for addressing international aviation emissions. Aviation operates as a global industry and policymakers face the challenge of reducing emissions while maintaining competitiveness.
Jarvis shared that under the ETS proposal only 13pc of airlines’ ETS payments would be recycled into SAF support. He shared that more than four times that amount was needed to cover the SAF cost gap. SAF allowances should be targeted on ETS-qualifying flights as that was where they were funded from.
The briefing heard that ETS should address carbon dioxide emissions while non-CO₂ effects including contrails were better addressed through airspace policy. Jarvis shared that the way forward was to strengthen global climate action through CORSIA rather than extending ETS beyond the EU. ETS revenues should accelerate SAF production and regulations should focus on delivering the greatest environmental benefit.
Kenton Jarvis shared: we do not support the European Commission’s proposal to extend the scope of EU ETS beyond the EU. The biggest opportunity that we have to decarbonize is obviously sustainable aviation fuels.
We need policies that make SAF more affordable and more widely available. Unfortunately, under the ETS proposal, only 13pc of the airlines ETS payments would be recycled into SAF support. To be in line with other sectors and to cover the SAF cost gap, we need more than four times that which the commission is proposing when it comes to ETS payments and the recycling of them into SAF support. And we also need the SAP allowances. They should be targeted on ETSs qualifying flights as that’s where they’re funded from. We need to make sure that every policy tool is focused on what it does best.
ETSs should address carbon dioxide emissions. Non CO2 effects, including contrails, are important issues, but more closely linked to how an aircraft operates and therefore are better to address in the context of airspace policy. Ultimately, it’s not a choice between climate leadership and a competitive European aviation market. We should want both. So the the way forward is to strengthen the global climate action through Corsa, do not extend ETS beyond the EU and use ETS revenues to accelerate SAT production and we should focus regulations on delivering the greatest environmental benefit. Done right, we can keep a competitive aviation sector in Europe, which we have today, and deliver climate leadership
Michael O’Leary: we don’t like the ETS tax for the uncompetitive reasons we’ve already spoken about. But the status quo is much better. The position is: if it’s not going to go away, leave it as it is. Otherwise it is just an additional tax or an extension of the tax that’s already in place. Not changing it is much better than extending it. We should not be extending it, but we should be looking at converting more of it into free allowances because that’s what happens in other industries. The proposal increases that element a bit, but it should go far beyond in terms of tying it to decarbonisation. Of course the extension should not be accepted.
