An emerging battle over transport industry emissions

International aviation and shipping represent a growing share of global GHG emissions. With the growing use of airplanes for tourism and of shipping for international globalized trade, miles traveled by both sectors are rapidly increasing, and with them fuel consumption as well.

One of the suggestions on the table to reduce emissions from these sectors, is to charge them with a small levy which would reduce demand for their usage, and raise new revenue for the green climate fund. Thus, a double dividend will be achieved – lowered emissions, and further finance for mitigation and adaptation projects.

At a side vent hosted by the international bodies representing shipping and aviation, they presented their opposition to the levy. The International Civil Aviation Organization (ICAO) argued that the levy would increase flight prices and thus hurt lower income passengers. The  International Maritime Organization (IMO) argued that the levy would hurt trade and thus infringe on the ability of developing countries to grow.

The alternative proposals put forth by the two organizations were very different in scope and possible impact. The ICAO suggested to voluntarily limit its emissions to a 2% growth per year until 2020, when they would then be stabilized. The IMO suggested a mandatory cap on shipping emissions, thus defining the desired outcome rather than trying to indirectly affect demand. They further proposed establishing an industry fund which would be run by governments and invest in green projects.

These are not unusual attempts by the private sector to prevent serious regulation. In fact, the EU has already announced that starting January, all flights coming into Europe and departing from it would have to comply with a cap and trade regime as part of the European Trading Scheme. This step has prompted threats of trade wars from the ICAO and other members of the international community.

However, in Durban, negotiators should not be deterred. Alternatives should be considered according to their potential to mitigate emissions while promoting equity. If anything, private sector response may attest to real fear of action, an encouraging sign in an otherwise somewhat crippled negotiations.