In defence of the EU ETS - PowerPoint PPT Presentation

1 / 29
About This Presentation
Title:

In defence of the EU ETS

Description:

Do penance. Seek redemption. Contributed to putting a patient in the emergency room ... Summary of our penance. EU ETS is the largest open ETS currently available ... – PowerPoint PPT presentation

Number of Views:26
Avg rating:3.0/5.0
Slides: 30
Provided by: utili136
Category:
Tags: ets | defence | penance

less

Transcript and Presenter's Notes

Title: In defence of the EU ETS


1
In defence of the EU ETS
  • ICAO and McGill IASL Worldwide Conference on
    Aviation Safety, Security and the Environment
  • Richard Janda
  • Martine De Serres
  • Institute of Air Space Law
  • Faculty of Law
  • McGill University
  • September 16, 2007

2
Disclaimer
  • The following is an optimistic dramatization.
  • Unfortunately, none of the views expressed
  • can be attributed to real actors with political
  • clout.

3
We have a big problem
4
Make a confession
5
Do penance
6
Seek redemption
7
Contributed to putting a patient in the emergency
room
8
(No Transcript)
9
Role in poisoning
  • Adding more poison all the time
  • But only 2 of what is being added
  • Have to poison the patient to do good things
  • Getting better all the time at poisoning less
    intensively

10
True confession
  • Actually, 2 of part of the poison (CO2)
  • But 3 of all poison (radiative forcing)
  • Actually, will be poisoning more because of
    projected growth
  • Will account for 5 by 2050
  • FASTEST GROWING CONTRIBUTOR

11
Another true confession
  • Have been avoiding penance and seeking
  • pity
  • Times have been hard
  • Dont force me to do anything
  • Have others pay

12
But have had an epiphany
13
My friend, Chemical Industry
  • Resisted EU REACH
  • Registration, Evaluation, Authorisation and
    Restriction of Chemical substances
  • Now learning to apply it globally

14
  • Want to stop poisoning, though I cant right away
    give me 50 years
  • I realize that it is cheaper to do it now than
    later (invest 1 GDP to avoid 11 GDP loss)
  • Can imagine non-poisonous aircraft, but this is
    now science-fiction

15
  • Make me pay for my poisoning in the meantime
  • I will buy the right to poison from others who
    have cut down
  • Will embrace EU ETS
  • Will lobby to have an ETS everywhere
  • Over the nest two weeks will seek to have ICAO
    create a SARP consistent with the EU ETS to be
    applied by all Members

16
Giving up on voluntary measures
  • Voluntary measures will create competition
    distortions
  • Have experienced destructive competiton before

17
Let me introduce my friend.
  • ICAO discourages environmental taxes
  • SARP on emissions is a light touch
  • ICAO has not taken any mandatory action pursuant
    to Kyoto Protocol mandate
  • ICAO has not welcomed unilateral action by EU

18
Whats the best solution?
  • Taxes?
  • Low price elasticity of demand
  • Little political support for high taxes
  • Competition distortion unless internationally
    applied
  • ICAO recommends against

19
ETS the best solution
  • ETS more dynamically efficient than tax
  • ETS self-adjusts to economic growth
  • A well-designed ETS may
  • Create abatement incentive for other industries
  • Allow emission caps on all aviation GHG
  • Avoid many competition distortion effects

20
Design elements of an ETS
  • Auctioning most credits may dampen competition
    distortion effects
  • Downstream ETS that includes other GHG than
    merely CO2 will efficiently reduce all aviation
    emissions
  • Open ETS could finance reductions in other
    sectors, compensating for air travel growth
  • Large spatial scope and coverage will strengthen
    flexibility of an open ETS
  • Banking could promote early action and protect
    against price fluctuations

21
Overview of EU ETS
  • Each member state responsible for its reduction
    goal, and allocates as such
  • Minimum 95 of rights grandfathered b/w
    2005-2007, 90 b/w 2008-2012
  • Only CO2 covered for now
  • Downstream system. Only 5 major industries
    covered, with expansion underway
  • Unrestricted transactions (banking ok)
  • Monitoring and supervision through reports
  • Penalty for failure to purchase allowances

22
Shortcomings of EU ETS
  • Trading period (5 years) may be too short for
    adequate financial planning
  • More auctioning needed
  • Allowance price is too low to efficiently promote
    reductions too many sellers
  • gt Need for emissions buyers

23
EU proposal to include aviation
  • EU in better position than ICAO to set up open
    ETS
  • Airlines are chosen participants
  • EU ETS would apply to
  • Domestic flights starting 2011
  • International flights starting 2012
  • Avoids competition distortion

24
EU proposal to include aviation (contd)
  • After 2012, amounts of allowances equal to
    average emissions b/w 2004-2006
  • No double-counting EU will negotiate with states
    having at least equivalent requirements
  • gt Invitation toward international ETS

25
Summary of our penance
  • EU ETS is the largest open ETS currently
    available
  • Global aviation regulation acknowledges that EU
    ETS should be built upon rather than opposed
  • BUT the global aviation
  • industry has raised doubts
  • about EU jurisdiction

26
Does the EU have jurisdiction?
  • Argument against Art. 24 of Chicago Convention
    (customs duties) and Arts. 11 and 15
    (non-discriminatory regulations and charges) Art.
    1 (sovereignty)
  • ETS is not a customs duty
  • ETS is not a navigation charge
  • ETS applies in a non-discriminatory fashion as
    between EU and non-EU carriers
  • ETS accounts for the emissions attributable to
    aircraft movements with EU origin or destination
    does not regulate movements originating and
    terminating outside the EU. Therefore is not
    extra-territorial
  • CO2 molecules do not respect territory

27
Toward redemption
  • Need to expand toward an international system
  • To avoid forum shopping
  • Avoid competition distortion on international
    scales
  • Efficiently reduce the climate impact of aviation

28
ICAOs benchmark for success
  • Create SARP on ETS
  • Standard design elements of ETS for aviation
  • Rules on allocating rights
  • Deciding on actors
  • Banking allowed
  • Accurately and transparently measuring emissions
  • Common and differentiated responsibility
  • Recommended practice all Member States have an
    open ETS for efficient reductions
  • A SARP is NOT voluntary

29
Ultimate redemption?
  • Lowering demand until 0 footprint achieved

vs.
Write a Comment
User Comments (0)
About PowerShow.com