Look Beyond ETS Headaches to Benefits

 - September 29, 2009, 6:48 AM

Aviation is not alone in its suffering at the hands of the emissions-trading scheme, and it should try to see its way through the frustration to some positive outcomes. This is the perspective of Sebastian Gallehr, whose Germany-based Gallehr Sustainable Risk Management company has been helping other industries with the complexities of ETS for more than seven years.

Gallehr told AIN that ETS implementation has been fraught with legal and bureaucratic problems since it was first imposed on other industries, such as the power-generation sector. The first ETS trading period came to an end in 2007, and even today the companies involved in this are still grappling with unanswered questions and headaches.

One of the core problems with ETS for aviation was that the rules and process were devised purely with larger airlines in mind and take little or no account of how smaller operators will cope with them, Gallehr indicated. He predicted that the EC will be compelled to allow some flexibility in ETS implementation in light of the severe difficulties operators have faced even in communicating with the competent authorities in each member state.   

“The authorities will be flexible because business aviation is so small [in terms of total carbon dioxide emissions from aviation],” said Gallehr. Apart from language difficulties in dealing with the various national authorities handling the ETS process, Gallehr said that operators face significant inconsistencies in the attitudes and approaches taken by bureaucrats in different countries.

“For example, in France the competent authority is under the aviation ministry and so it is quite aviation-friendly, but in Germany ETS is under the environment ministry, which is not so friendly, and it is hard for operators to change their competent authority,” said Gallehr. He indicated that there is next to no point in operators appealing to the EC if they cannot get cooperation from their assigned national competent authority because legally they are accountable to that particular European Union member state.

“We advise operators to send even just a basic preliminary plan, giving their basic details and how they will monitor the ton/kilometer payload calculations,” said Gallehr. He maintained that the detailed aspects of operators’ plans for the monitoring, reporting and verification of CO2 emissions can be changed later as ETS does not come into full force until 2012.

Gallehr predicted that the European Commission will accept Eurocontrol’s new ETS support facility, a revised version of its Pagoda air-traffic data-calculation model, as a basis for monitoring and reporting emissions. However, he predicted that it will not accept EBAA’s argument that this data should not require independent verification.

Nonetheless, from his experience in helping companies from other industries Gallehr predicts that aircraft operators may yet enjoy some tangible benefits from ETS in terms of reducing operating costs from lower fuel burn and even generating income from the sale of unused emissions credits. He advises operators to make long-term strategic plans for “optimizing” their involvement in ETS rather than focusing exclusively on the short-term negatives associated with the initial phases of its implementation.