Europe Emissions Scheme Would Hit Air Fares - BA
Date: 10-Feb-06
Country: UK
Author: Stuart Penson
Europe's third-biggest airline, which backs the industry's entry to a pan-European emissions trading scheme, said some impact on ticket prices would be unavoidable.
"If the idea of emissions trading is to make energy intensive activities more expensive, then there will be some impact on ticket prices," said Andy Kershaw, Climate Change Manager at BA.
"Certainly I would expect some impact," he told an emissions trading conference. He declined to speculate on the potential size of increases.
Kershaw said BA was working on the basis that it could enter the emissions trading scheme in 2008, though he said 2010 was probably a more realistic date.
European governments have backed proposals to include aircraft in the Europe's trading scheme, which was launched in January last year as the bloc's main way to meet Kyoto Protocol goals on cutting emissions.
The scheme currently covers about 12,000 factories and power stations, imposing caps on their carbon dioxide (CO2) emissions but allowing them to trade around those caps in a market for CO2 credits.
A recent study commissioned by the British government said the inclusion of aircraft in the scheme would not have a major impact on the price of CO2 credits traded in the market. CO2 credits traded on Thursday at 26.45 euros a tonne.
BA, which says emissions trading is a better way of tackling climate change than taxation, already trades emissions under a voluntary scheme in the UK.
BA said it would want its participation in the European scheme to be restricted to emissions from flights within Europe, about 20 percent of the miles its cover globally.
The United States, which has not signed up to Kyoto, is pressing the European Union to keep US airlines out of the scheme.
Kershaw also said BA would want a centralised approach to setting targets for the airline industry, rather than a company by company approach which could distort competition.
