Airlines’ golden (corona) life jacket makes a mockery of the green recovery

It’s been a rough few months for the aviation sector around the world, as most aircraft have not left the tarmac and major airlines are losing millions every day. But the industry has used the situation very effectively to push governments to weaken climate policies. The same governments are handing out multi-billion euro bailout packages, with little to no environmental strings attached.

The UN aviation agency decision-making ICAO Council has agreed to change the baseline of the global variation carbon market CORSIA during its pilot phase (until 2023) and to consider further changes over the coming years. The aviation lobby, IATA, had requested to review the baseline above which the growth of emissions from planes will be offset under the global aviation carbon market CORSIA. 

CORSIA is the main – if grossly insufficient – international climate policy covering aviation. Under it, airlines are expected to buy offsets from climate projects around the world to compensate for the growth in their pollution after 2020. 

The rule change will require airlines to offset emissions above their 2019 levels only during the pilot phase of the scheme (until 2023), instead of the average of their 2019-2020 levels as originally agreed. States will then further consider a possible revision to later phases of the system as well. What appears to be a technical change, will, in fact, postpone the start of the scheme by at least three years, until 2024 or later, depending on how fast the sector will recover from the current crisis, and on whether governments decide to extend this change to the subsequent phases. This is because airline emissions have dropped massively in 2020, due to planes being grounded, and hence their emissions are below 2019 levels, which means there will likely be no growth to offset.

This lobbying exercise is another example of the aviation sector’s hypocritical climate stance: airlines claim to fully support climate action by backing CORSIA, while at the same time investing significant resources in efforts to weaken it. The result is a climate policy which is dying before it even starts. While CORSIA will officially start in 2021, airlines will not have to do anything until several years later.

This change is also unnecessary from the point of view of “burdening” airlines financially. There is an ample supply of offsets to cover airlines’ demand even without changing the baseline. Furthermore, these offsets cost basically nothing. For example, credits under the UN carbon market Clean Development Mechanism (CDM)  which will be eligible under CORSIA, trade around 25 euro cents per credit (the 2018 average price on the voluntary market was around 3$/credit).

Several EU countries sit on the ICAO Council and have supported the baseline change. Last month, EU member states agreed to support it as proposed by the European Commission. Only Sweden was against the further weakening of the already inadequate CORSIA.  Meanwhile, Members of the European Parliament representing all the major political groups also recently wrote to the European Commission urging it to oppose the baseline change.

However, Europe has made climate commitments that require all sectors to reduce emissions. Hence, as the global aviation climate scheme quickly loses its last bits of credibility, it becomes ever more important to act at the regional and national levels. Paradoxically, this is what airlines are trying to avoid by “supporting” CORSIA, while at the same time trying to weaken it to the extent that it has no relevance.

Concretely, action in Europe means ending the industry’s tax holiday when it comes to for example kerosene tax and making them pay fully for their pollution under the EU carbon market. 

In the absence of a Europe-wide ticket tax, national governments are taking matters into their own hands. The latest example comes from Switzerland, which has passed a new ticket tax, with revenues returned to citizens and reinvested in climate action. This is a positive first step towards better pricing of aviation emissions in the country.

An industry that avoids taxes cries for public bailouts

At the same time, despite pledges to make the COVID19 recovery green, EU governments are pouring public money into saving airlines – mostly without any environmental conditions. To date, they have handed out close to 30 billion euros in bailouts. The US has earmarked 50 billion for its airlines.  France and Austria have both proposed some modest climate conditions to their bailout packages, but these will still need to be evolved into binding rules. 

There is no denying that airlines are facing difficult times. But the industry is also shamelessly exploiting the health crisis to push against a diverse range of policies, including climate regulations, with the stated objective of paying even less into government coffers. Some, such as Alitalia or Boeing, are using the pandemic to get government support to solve financial troubles that pre-date the crisis.

 As it stands, governments are squandering away their chance to make taxpayer bailouts to airlines conditional on the industry committing to cut its pollution. This catering to the short-term interests of big polluters must stop. Governments have the responsibility to think also long-term and to act in the interest of their citizens who deserve a climate-safe world.

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