The long-simmering dispute over Europe’s emissions trading scheme (ETS) heated up after a U.S. Senate committee advanced legislation that would empower the secretary of transportation to prohibit American airlines from participating in the carbon cap-and-trade construct. But the Obama administration did not officially endorse the legislation. Instead, the Administration continues to push for the development of an alternative emissions reduction scheme by the International Civil Aviation Organization (ICAO) in Montreal.
On July 31 the Senate Commerce Committee reported out favorably the European Union Emissions Trading Scheme Prohibition Act, which South Dakota Sen. John Thune (R) introduced last December. The full Senate left for its summer recess on August 3 without voting on the bill. The U.S. House passed its own ETS prohibition legislation last October. Congress must reconcile the two bills and President Obama must sign the resulting legislation before it becomes law.
Under the Senate bill, the Secretary of Transportation “shall prohibit an operator of a civil aircraft of the United States from participating in any emissions trading scheme unilaterally established by the European Union” if the Secretary determines the prohibition consistent with public interest. But Transportation Secretary Ray LaHood said his department has taken no position on the legislation. “We believe that ICAO is the place to resolve this,” he told senators during a June 6 hearing. “Our efforts have been to get the discussion going by having people use ICAO to make this happen.”
The Senate committee’s action came as the U.S. government on August 1 concluded a two-day meeting on the ETS with representatives of 16 other countries. The gathering in Washington, D.C., produced “unanimous opposition to the ETS as applied to foreign carriers” but no formal declaration, said a senior administration official. Before the meeting, 19 industry groups, including Airlines for America, the Air Line Pilots Association and the Aerospace Industries Association, produced a joint letter urging the Obama Administration to file a complaint under Article 84 of the Chicago Convention, which would call into play the ICAO Council to resolve the dispute among its member countries. The administration official said the government has not decided whether to file an Article 84 challenge. But the dispute-resolution procedure “is always an option,” the official said.
“Noteworthy that there was no agreed statement from the (Washington) meeting and nothing new on substance,” Danish politician Connie Hedegaard, EU Commissioner for Climate Action, remarked in a tweet. “Good that parties promise to engage in ICAO—the EU has done so for many years,” she added.
The ICAO assembly is still a year away from meeting to consider proposals for market-based measures to control emissions, an alternative that could persuade the EU to set aside the ETS for aviation. But the organization has made some progress in the meantime. On July 10, ICAO’s Committee on Aviation Environmental Protection approved a CO2 metric system that accounts for different aircraft sizes and provides the basis to develop the first CO2 standard for commercial aircraft.