Arab airlines to fight planned EU carbon curbs

Move to curb carbon emissions set to cost fast-growing Gulf carriers millions of dollars
Arab airlines to fight planned EU carbon curbs
Under EUs proposals, airlines will have to buy permits to help offset greenhouse emissions
By Shane McGinley
Wed 09 Nov 2011 12:31 PM

Arab airlines will
fight European Union plans to charge carriers for their carbon emissions, the
region’s aviation trade body said, following in the footsteps of Chinese, US
and Indian airlines.

The Arab Air Carriers Organisation, which represents
airlines including Emirates, Etihad and Qatar Airways, said it will lodge an
objection ahead of a meeting of the International Civil Aviation Organization
(ICAO) in December.

The ICAO has already said it believes the planned carbon
scheme is flawed and has urged the European trade bloc to review the plan in
light of industry oppositions.

“AACO has requested its Civil Aviation Authority Commission
to issue a similar declaration and to submit it to the ICAO Council,” Manal
Diab, a director at the Beirut-based industry group.

“[We are] talking to Arab Civil Aviation Commission about
this issue and we are still awaiting the decision of the ACAC to be taken on

Under the EU's proposals to put a price on pollution,
airlines will have to buy permits to help offset greenhouse emissions from
jetliners operating in, to and from Europe.

Airlines will face fines of up to €100 for every tonne of
carbon dioxide they emit above a fixed limit; part of an EU bid to cut
pollution by five percent through 2020.

The scheme has spurred outrage among global carriers, who
say the cost of compliance could run into millions of dollars in an already
tough economy.

In protest against the law, due to take effect on Jan 1, the
Air Transport Association of America, American Airlines and United Continental
took their case to the High Court in London, which referred it to the European
Court of Justice (ECJ) last year.

Air China and three other Chinese
carriers said this week they planned to jointly sue the European Union over the
planned charges – but Diab said he thought it unlikely that individual Arab
airlines or countries would pursue similar legal action. 

“I don’t think individual Arab states… will take similar
action… taking into account the size of each country compared to the US,” he

The International Air Transport
Association said it supported emissions trading in principle; “but only
if it does not distort competition or be imposed extra-territorially.”

The EU plan is expected to take a significant toll on the
balance sheet of fast-growing Gulf airlines. The region’s largest carriers -
Etihad, Emirates and Qatar Airways – have rolled out ambitious expansion plans
that include ramping up capacity on their European routes.

Emirates Airline, the largest international carrier, said in
August the scheme could cost it up to $1bn.

Abu Dhabi’s Etihad Airways in August said the tax could cost
it up to €500m ($719m) over the next eight years, based on “potential carbon
prices as high as €60 per tonne”.

The aviation industry has become a “whipping boy” for
environmental issues”, CEO James Hogan said in September, branding the scheme a
dressed-up means for EU governments to net revenues.

“It is a revenue-generating tax, plain and simple. We cannot
support legislation that unfairly penalises the industry,” he added.  “The
aviation industry should not be the whipping boy when it comes to the

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.