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Agreement To Limit Aviation Emissions Pretty Worthless

October 11, 2016

By Paul Homewood 




Another piece of recent news from the Telegraph, that I am catching up on:


The aviation industry has crossed a threshold. After almost two decades of talks, 191 countries gathered in Montreal last week to adopt a global market-based system to tackle the rise of carbon emissions from international air travel.

The deal has been welcomed by governments as an unprecedented diplomatic success, and by green groups as a hopeful starting point for further environmental progress.

But for some embattled airlines, it could deliver a fatal blow to the gilded decades of low-cost flights.


An agreement to reduce carbon emissions might be a fatal blow to low-cost airlines. 

An agreement to reduce carbon emissions might be a fatal blow to low-cost airlines.

The second half of the last century played host to a revolution in air travel, driving the globalised economy that is taken for granted today. 

In 1945, it might have taken 130 weeks for a person earning the average Australian wage to earn enough for the lowest Sydney to London return air fare. Now it would take less than two.

But the boom in air travel is quickly giving way to an industry-wide bust. Airline profits have plummeted amid terror attacks and economic gloom, sparking aggressive staff cuts and strike action. 

The price of jet fuel makes up a third of an airline’s total costs, potentially delivering a fatal blow to smaller airlines if prices spike.

Even easyJet, one of Europe’s most successful short-haul players has admitted that it is bracing for £90 million hit in its first profit warning since 2009.

Air Berlin, Germany’s second largest carrier, is expected to slash 1200 jobs and halve its fleet of 144 aircraft after reporting its eighth consecutive annual operating loss last year.

Even with fuel oil costs at historic lows, European airline bosses say the industry is facing the toughest market in 30 years. The gloom could take until the end of the decade to fade. 

By then, airlines will need to face up to steadily rising environmental costs running into the billions of dollars while undertaking green investment totalling trillions as the oil market threatens a return to higher prices.

Under the new deal, airlines will be expected to offset their emissions growth after 2020 by buying "offset credits" in line with their carbon footprint.

The carbon costs are expected to incentivise the industry to develop lower-carbon fuels and technologies, while the money raised by the credits will fund environmental initiatives to help to tackle climate change.

Almost 1400 airlines operate a fleet of 25,000 aircraft burning 1.5 billion barrels of jet fuel every year. 

Almost 1400 airlines operate a fleet of 25,000 aircraft burning 1.5 billion barrels of jet fuel every year.


This cost is forecast to grow to as high as $23.9bn by 2035, or 1.8pc of the airlines’ revenue. At the same time airlines will need to spend more on developing lower emissions aircraft, technologies and fuel.

Still, there are many who believe that the cost is too low. UN observers at the campaign group Transport and Environment claim the costs are "peanuts" to the airlines and will amount "to little more than adding the price of a cup of coffee to a ticket".

Yet, there seems little doubt that there will be further pressure to ratchet costs higher. The direction of travel raises the question: is the golden age of cheap European air travel losing its gleam? 

Accendo Markets’ equity analyst, Mike van Dulken, agrees that the days of cheap and cheerful European air travel could be numbered. Holidaymakers may face a more "budget" experience for higher prices, as airlines are forced to invest in new aircraft to escape escalating carbon costs. Already British Airways has announced plans to scrap free food and drink on its short-haul flights in favour of selling snacks and sandwiches from Marks & Spencer.

He says: "Unless lower flying costs through fuel efficiency can offset higher aircraft prices, the difference will almost certainly have to be passed on to flyers. Should the oil price rise again due to undersupply in the next five years, this would add an additional unwelcome headwind for airlines already struggling badly."


Like a lot of these things, the agreement does not do what it says on the box. It won’t lead to lower emissions, it simply asks airlines to buy carbon offsets if they exceed emissions in the baseline years of 2019/20.

If the figures quoted are true, the scheme will likely have little effect on aviation emissions. Instead of imposing caps, airlines will simply get around increasing emissions by buying carbon offsets. We know how broken and corrupt the whole system of carbon credits is.

Airlines already have huge incentives to improve fuel efficiency, as fuel costs already make up a third of their budget. Unsurprisingly, such improvements have helped to offset increased traffic in recent years.

Adding an extra 1.8% is chicken feed, especially compared to the volatility that oil prices bring. Both will end up being priced into the cost of a ticket, and as the UN observers point out, a couple of quid here and there is little more than the price of a cup of coffee. All the scheme will achieve is an increase in bureaucracy.

The only people who will end up gaining are those who benefit from the carbon offset market.   




More detail on the agreement from ICAO here.

  1. markl permalink
    October 11, 2016 3:58 pm

    So how are they going to get Russia, and India, or anyone for that matter to actually pay into this protection racket? The UN taxing countries? How does that work? What will the UN do to those airlines that refuse? So Jet Blue refuses to put itself out of business by raising prices will the UN shame them into complying?

  2. KTM permalink
    October 11, 2016 4:44 pm

    The government should immediately implement carbon caps on all government travel.

    Once the politicians have exceeded their annual allotment, they must find carbon free transportation until the next year.

    Of course they should not mandate which travel is used, just leave it up to the individuals to figure out the appropriate mix of air, rail, motor, sea, and buggy to make sure they stay below the cap, then let market forces go to work. Any attempts to circumvent the cap will be met with harsh punitive consequences.

  3. October 11, 2016 5:27 pm

    C’mon BBC, Guardian, etc now is the time for you to impose cuts on your air travel budgets, how about 20% by 2020. No, why not be really AMBITIOUS, make it 90%, double greenie points awarded for opting for 100%.

    • KTM permalink
      October 11, 2016 5:38 pm

      Under Obamas clean power plan there are no ‘elite’ companies that get to ignore the carbon caps. Why should transportation be any different?

      They think we’re already over indulging in carbon, so let them set their cap below the average carbon transportation budget of the average person.

  4. Broadlands permalink
    October 11, 2016 5:43 pm

    Another reason to emphasize that no reduction of either emissions or atmospheric CO2 can possibly make any real difference in any plausible time frame. The amounts of CO2 involved are much too large. Just one ppm of CO2 is two Billion metric tons. Current emissions are around 25-30 billion tons per year. And after reaching zero emissions “we” are supposed to lower the atmosphere to 350 ppm… capture and store 50 ppm, 100 billion tons.

    Is anyone paying attention or just paying offsets?

  5. Jack Dawkins permalink
    October 11, 2016 5:48 pm

    According to the IPCC Aircraft Engine Emissions

    “Carbon dioxide CO2) and water vapor (H2O) are easily the most abundant products of jet fuel combustion (emission indices for CO2 and H2O are 3.15 kg/kg fuel burned and 1.26 kg/kg fuel, respectively)…”

    So jet engines emit 2.5 times more CO2 than water vapour.

    According to Lindzen – Climate Sensitivity to Radiative Perturbations: Physical Mechanisms and Their Validation (1996)

    “The authors find that for the clear sky case the contribution due to water vapor to the total longwave radiative forcing is 75 W/m², while for carbon dioxide it is 32 W/m²..”

    So the greenhouse effect of water vapour is 2.34 times greater than CO2. This means that for jet engines, the greenhouse effect of each gas is virtually identical.

    Go figure.

  6. A C Osborn permalink
    October 11, 2016 6:00 pm

    “The only people who will end up gaining are those who benefit from the carbon offset market. ”

    The very reason why Goldman Sachs having pushing so hard, so much so they forced the replacement of the Australian PM.

  7. Swisspeasant permalink
    October 11, 2016 6:28 pm

    And the Government proclaims today a more than doubling of flights between UK and China and the benefits it will bring.
    They are in Denial about what it is they have signed up for.

  8. October 11, 2016 6:56 pm

    ‘The world’s commercial jet fleet is expected to more than double by 2025’
    Doubt that’s possible, Paul, even with Boeing and Airbus put on a war footing by the World Government.
    Whose caption was that and where did it come from?

    • October 11, 2016 7:09 pm

      Telegraph apparently

    • October 11, 2016 8:25 pm

      When the Chinese enter the jet plane market the numbers could be big.

      • October 11, 2016 9:44 pm

        Both China and Russia have had commercial airliners under development for well over a decade with almost nothing to show yet, no sign they can crack the market at all. Canada, Brazil, maybe Japan, have a small capacity. Unless they count a possible mushrooming of air taxis or ‘NetJets’ type operations, it can’t happen. Not in passenger-seat-miles.

        Nice selection of tails, though!

  9. Stosh permalink
    October 11, 2016 9:07 pm

    So private jets to glo-bull warming conferences would be allowed in the future…

    • Gerry, England permalink
      October 11, 2016 11:07 pm

      Of course. The elite have important business to deal with.

  10. October 12, 2016 12:00 am

    1.5 billion bbls/year in 25,000 aircraft means ~164 bbls per plane per day. I don’t think so!

  11. tom0mason permalink
    October 12, 2016 3:28 am

    The problem with flying as I see it, is not just the burned fuel that exits the plane at high altitude but the semi-burned and unburned fuel (dumping fuel to lighten the plane) entering the high atmosphere. Are there any studies to show what is happening with all these plane flying about.
    We know all these planes have an effect as after the Twin Towers were destroyed, planes were grounded, and US weather patterns appeared to show major changes.

    • catweazle666 permalink
      October 12, 2016 9:34 pm

      “We know all these planes have an effect as after the Twin Towers were destroyed”

      We do? News to me.

      I’ve heard it, but I’ve never seen any evidence for it.

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