House T&I Committee endorses EU decision to halt aviation emissions tax

By Jeff Berman, Group News Editor
March 10, 2014 - LM Editorial

The House Transportation and Infrastructure (T&I) breathed a collective sigh of relief last week, following the European Union’s (EU) reported agreement to reverse its plan to impose a carbon tax on non-EU carriers operating long haul flights in and out of Europe.

The EU’s plan is known as its emissions trading scheme and is designed to impose new emissions taxes on the United States and other nations’ air carriers flying into and out of the EU.

In February 2012 the Wall Street Journal reported that a group of 29 nations, including the U.S., Russia, China, and India, called on the EU to reject the ETS, explaining that they had agreed to adopt a “basket of measures” that permit each nation to choose the actions it finds most effective to counter the ETS.

The EU ETS was created in 2005. According to the EU, the ETS places a cap—or limit—on the total amount of certain greenhouse gases that can be emitted by the factories, power plants and other installations in the system. Within this cap, companies receive emission allowances, which they can sell to or buy from one another as needed.

This was originally scheduled to take effect for the airline industry on January 1, 2012. The EU maintains that under the ETS at the end of each year a company must either surrender the allowances needed to cover their actual emissions or pay steep fines. And the WSJ report also noted that the ETS has met strong resistance and raised fears of a trade war, with opponents saying it is exceeding its legal authority by imposing emissions charges for flights outside the EU.

“Aviation is a global industry and we are pleased the EU now appears to be focused on working with the international community rather than unilaterally imposing an emissions tax on other nations’ air carriers,” said Transportation and Infrastructure Committee Chairman Bill Shuster (R-PA), Full Committee Ranking Member Nick J. Rahall, II (D-WV), Aviation Subcommittee Chairman Frank LoBiondo (R-NJ), and Aviation Subcommittee Ranking Member Rick Larsen (D-WA), in a statement.

United States-based opposition to the ETS has been clear for some time.

In November, the House T&I’s Committee’s Aviation Subcommittee penned a letter to Department of Transportation Secretary Anthony Foxx, calling on Foxx to protect U.S. aircraft operators from unfairly being subjected to the ETS while a global plan to reduce emissions is being developed.

That agreement was outlined in the letter to Foxx, which the subcommittee said was achieved at the International Civil Aviation Organization (ICAO) in October 2013. This plan is based on the ICAO General Assembly agreeing to develop a global-based mechanism between now and 2016 to reduce aviation emissions, which if agreed to, would take effect in 2020.

The lawmakers added in the letter they maintain the EU’s amendment to the ETS “violates the spirit of the ICAO agreement, as it would unilaterally be applied to portions of U.S. flights to and from the EU.”

Brandon Fried, executive director of the Washington, D.C.-based Airforwarders Association, told LM that the recent change of heart from the EU regarding its plans to not include a carbon tax for flights in and out of Europe is welcomed news.

“The Airforwarders Association views the European Union’s decision to reverse its plans to impose a carbon tax on non-EU carriers operating long haul flights in and out of Europe as a positive development not only for passengers but cargo shippers as well,” said Fried. “The rescinded scheme would have increased costs for our airline partners ultimately raising rates for customers without any significant impact on reversing the climate change problem. A more preferable solution should include all nations together in arriving at a single policy to address this significant issue.”



About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

When it comes to the chances of the December 31, 2015 Positive Train Control (PTC) deadline being extended, something which railroads say is badly needed, it appears they need to be prepared to be disappointed. That was the chief takeaway of a statement from Sarah Feinberg, acting administrator of the United States Department of Transportation’s Federal Railroad Administration (FRA).

It’s said that innovation will lead the economy out of its current funk. But how does an organization become a perpetually innovative company? That’s one of the questions Kai Engel and his co-authors at A.T. Kearney set out to answer in their new book Masters Of Innovation.

At $2.843, the average price per gallon was down 1.6 cents, following last week’s 1.1 cent drop and a cumulative 7.1 cent cumulative drop over the last five weeks.

LM Group News Editor Jeff Berman caught up with UPS Freight President Jack Holmes at the National Shippers Strategic Transportation Council’s (NASSTRAC) Annual Conference and Exhibition. Berman and Holmes spoke about various aspects of the less-than-truckload sector (LTL), as well as related freight transportation news and trends.

In the third-party logistics (3PL) sector, the ongoing trend of merger and acquisition (M&A) activity never seems to take a break. That is apparent in recent weeks alone, with XPO Logistics recent acquisition of Norbert Dentressangle for $3.53 billion, Echo Global Logistics scooping up Command Transportation for $420 million, and Kuehne+Nagel buying ReTrans for an undisclosed sum.

About the Author

Jeff Berman, News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA