A Report in The Australian says that Australians heading to Europe face fare increases of at least $65 after the European Union voted to include aviation in its emissions trading scheme – a move Qantas warns will put it at a competitive disadvantage.
The controversial decision means flights landing and starting in the EU will be included in the emissions scheme from 2012, reports The Australian.
International flights bound for Europe will be subject to a carbon tax, and a European Commission report estimates this will add at least $65 to long-haul flights and E9 to short-haul flights.
The decision was condemned by international airlines, which called for a global scheme rather than the piecemeal introduction of regional emissions trading.
The International Air Transport Association has predicted that the European scheme would cost the aviation industry an additional $5.8 billion in its first year and spark a flurry of international legal battles.
Qantas warned that the scheme would be a financial burden and leave it competitively disadvantaged.
Qantas chief risk officer Rob Kella said the airline supported emissions trading, provided the schemes did not exacerbate competitive distortion between airlines, industries or regions.
“As the price of jet fuel skyrockets, the addition of an unrealistic trading scheme will place a serious financial burden on airlines,” Mr Kella said.
“We believe the proposed EU scheme goes well beyond the current Kyoto Protocol, and introduces competitive distortion.”
The move comes as airlines struggle with record jet fuel prices that recently topped $US170 a barrel and pushed the global aviation industry back into the red.
IATA director-general Giovanni Bisignani questioned the right of Europe to impose ETS charges on an Australian carrier, flying from Asia to Europe, for emissions over the Middle East.
Mr Bisignani said the scheme was a punitive tax introduced by politicians “who want to paint themselves green”.
The EU policy requires that airlines flying to and from Europe reduce their emissions from 2012. They will initially be required to cut just 3 per cent of average 2004-06 emission levels, rising to 5 per cent in 2013.
They will get 85 per cent of their pollution permits free, and there is a possibility that EU could exempt airlines with their own emissions trading schemes from its jurisdiction.
The Air Transport Association of America has already flagged a potential legal challenge to the legislation.
A Report by The Mole from The Australian.
