June 11, 2012

In response to Secretary of Transportation Ray LaHood’s testimony June 6 before a Senate hearing regarding the impact from the European Union’s Emissions Trading Scheme (EU-ETS) on operators in the United States, Sen. Johnny Isakson (R-GA) asked LaHood to file a complaint with the International Civil Aviation Organization (ICAO), and ask the council to intervene on the matter.

In his June 7 letter to LaHood, Isakson thanked him for his “candid views and strong opposition” to the trading scheme. “I would strongly encourage the Administration to file a formal Article 84 complaint against the EU on this issue in the International Civil Aviation Organization (ICAO), wrote Isakson. “I believe you would find significant bipartisan support for the complaint in the House and Senate.”

Read the full letter from Sen. Isakson (166 KB, PDF)

Article 84 of the Chicago Convention allows the ICAO Council to resolve aviation-related disputes between the European Commission and its member states if prior attempts at reconciliation prove futile. In his testimony, LaHood noted, “[T]here’s been no decision” from the Administration on whether such a move is being considered.

LaHood joined several other officials and aviation leaders, including NBAA President and CEO Ed Bolen, in testifying before the Senate Commerce, Transportation and Science Committee about the negative economic effect that EU-ETS would have on the aviation industry.

Review Bolen’s written testimony (70KB, PDF)

“Despite the aviation industry’s clear commitment to reducing its already small environmental footprint, the EU made a decision to move forward in a unilateral and divisive fashion with the ETS,” Bolen stated in his testimony. “Business aviation is aligned with the rest of the aviation community in strongly opposing the ETS’s application to international aviation and in reiterating our belief that resolution through a global sectoral approach will best advance our shared environmental goals. The International Civil Aviation Organization is the appropriate body to establish the targets and mechanisms.”

Bolen also noted that the scheme carries even more onerous burdens for business aircraft operators, however, as commercial operators receive most of their carbon allowances free of charge. These free allowances are not available to “non-commercial” operators; in addition, non-commercial operators are not eligible for the “small emitter exemption” and must participate in ETS from the first flight.

Additionally, EU-ETS also raises privacy concerns, as it requires operators to provide sensitive data to authorities, including bank account information, flight data and other disclosures. NBAA is among several aviation groups supporting Senate legislation banning U.S. participation in EU-ETS outright.

Meanwhile, the European Union appears to be sticking to its guns on the trading scheme. Jos Delbeke, head of the European Commission Directorate-General for Climate Action, told the Senate panel that while the EU may allow some modification to the trading scheme, “there is no prospect” of suspending the program completely.