The EU is considering extending its carbon emission charges on aviation to flights from outside the European Economic Area (EEA), according to multiple media reports.
The bloc’s Emissions Trading System (ETS) currently only covers short-haul flights within the EEA. But the EU is due to announce details of how it plans to reform ETS on 15 July, including a possible extension to cover intercontinental flights.
“The review should ensure that all sectors under the ETS contribute fairly to the EU’s climate targets,” said the European Commission in a document, which has been seen by Bloomberg News.
But airlines have been quick to warn that an expansion of ETS to flights from outside Europe could lead to higher ticket prices for passengers and businesses.
“Expanding EU carbon pricing to extra-EEA flights will further penalise European passengers and businesses by increasing the cost of airfare and cargo,” said airlines in a joint letter to commission president Ursula von der Leyen.
Signatories to the letter included Europe’s largest airline groups, such as IAG, Air France-KLM, Lufthansa Group, easyJet and Ryanair.
ETS was first launched by the EU in 2005 before being expanded to aviation in 2012. The EU had originally proposed to include flights from outside the EEA in the scheme before dropping that plan in the face of strong opposition from foreign governments and airlines.
The review of the system is being undertaken to bring it into line with the EU’s new climate target of cutting 90 per cent of emissions (compared with 1990 levels) by 2040.
Currently, ETS places an emissions cap on airlines operating within the EEA and the EU has been gradually phasing out free carbon allowances for aviation. These allowances are due to be completely removed in 2026, leading to warnings from airlines about higher costs and competitive disadvantages.
In March, von der Leyen promised to “modernise” the ETS and “make it more flexible” in the wake of the current energy crisis and skyrocketing jet fuel prices caused by the ongoing Iran war.