Low-cost airlines claimed on Monday that they will not make windfall profits from a trading program intended to limit their greenhouse gas emissions.
The EU wants all airlines that fly within its borders to trade pollution permits beginning in 2011, forcing them to buy more permits if they want to operate more or longer flights.
The EU’s cap-and-trade program gives companies a permit to pollute that they can sell to other companies if they use cleaner technology or emit less carbon dioxide. Businesses with more permits than they need can potentially profit.
But EU governments and lawmakers plan to force airlines to buy 15 percent of available permits to avoid any profiteering — something the European Low Fares Airline Association says is unlikely to happen.
A report ordered by the UK government last year claimed that all airlines would be able to pass on extra costs to customers, giving carriers less incentive to make real cuts to how much carbon dioxide they emit. To combat this, it called for more permits to be sold to companies.
The association says members will instead be unfairly loaded with high costs because they will have to buy the permits.
They cited a study they commissioned by Ernst & Young and York Aviation. It forecast a cost of 4 billion euros (US$5.5 billion) per year for low-cost carriers if they had to buy just 3 percent of all permits. The airlines say this will wipe out future profits and stop them from expanding.
The global airline industry also says that governments are ignoring airlines’ efforts to become more fuel-efficient and are threatening them with extra costs instead.
Giovanni Bisignani, the director general of the International Air Transport Association, said on Monday that airlines are generating enormous carbon dioxide savings by shortening routes, managing fuel more carefully and improving air navigation.
He said that “governments think green and see cash.”
“We get tax after tax, conceived in the name of the environment, which rob the industry of the cash to invest in technology,” he said in a speech in Amsterdam.
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