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Airline Passengers to Pay for Pollution

By Dan Milmo

Willie Walsh, British Airways chief, says airline emissions trading scheme will mean fares rises

Airline passengers will have to pay for the environmental impact of their journeys through fare increases if carriers join a global emissions trading scheme, according to British Airways boss Willie Walsh.

Airlines could contribute $5bn (£3bn) a year to help developing countries fight climate change if a scheme goes ahead, according to the Aviation Global Deal Group, whose members include BA, Virgin and Air France-KLM.

Under one version the industry would be limited to an amount of carbon dioxide emissions – for instance, 97% of 2005 emissions in 2005 – and would receive free carbon permits equating to 85% of its permitted emissions, and would bid for the rest. A proportion of those auction proceeds would go to developing countries.

The group made the proposal amid mounting frustration over negotiations for the Copenhagen climate change conference in December, which will thrash out a sequel to the Kyoto agreement. Airlines are concerned their representative body, the International Civil Aviation Organisation, will not produce a robust proposal in time and could expose them to measures such as an international air travel levy.

Walsh said fares would "have to" rise in order to cover the cost of a global trading scheme. Walsh added that the sector's "unsustainable" financial state, with a total loss of $9bn forecast this year, made fare rises inevitable. "This is going to add billions to the industry's cost base and the industry is unlikely to be able to absorb the cost. For the industry to play its part the people who benefit from that industry will have to pay for it as well."

Walsh said the European Union should use its emissions trading scheme as a fore-runner for a global programme but not attempt to drag in non-EU airlines lest they take legal action.

This piece originally appeared in The Guardian.

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Posted by: Simone on 16 Jul 09

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