EU suspends emissions tax

The issue of aviation carbon emissions should be resolved under a multilateral negotiation framework, and the industry should wait for the International Civil Aviation Organization (ICAO) to propose a solution, experts said Thursday, after a plan to suspend emissions fines was approved by the European Union (EU).

The suspension will save Chinese airlines hundreds of millions in potential fines each year. Had the fines been applied, they would have cost as much as 800 million yuan ($128.56 million) in 2012 and 1.7 billion yuan in 2015, the Beijing News said Thursday.

The charges would increase flight prices to European Union countries by 200 to 300 yuan, said the report.

On Tuesday, the EU Parliament's Environmental Committee voted in favor of a plan to suspend the carbon tax by a year for all airlines flying to and from the EU, though the suspension still needs the endorsement of a full parliamentary session in April.

The EU's Emissions Trading Scheme (ETS) took effect on January 1, 2012, but has aroused international opposition ever since. In November, the EU proposed suspending the plan.

"The suspension is very unlikely to be overturned in the April vote," Zou Jianjun, a professor with the Civil Aviation Management Institute of China, told the Global Times.

Calls to China's Civil Aviation Administration went unanswered Thursday. But the Beijing News report said the administration agrees with the Ministry of Foreign Affairs, which has expressed strong opposition to the EU's unilateral policy.

Chai Haibo, deputy secretary-general of the China Air Transport Association, told the Global Times that to seek a multilateral negotiation framework under the ICAO is the most "reasonable" way to resolve the issue.

"We hope that the ICAO can come up with a plan acceptable to all parties involved - not only resolving the emissions issue, but also minimizing harm to the development of the aviation industry," Chai noted.

"It is not very likely that the EU will continue the penalty scheme, given the strong opposition," Chai noted.

Earlier data from the International Air Transport Association showed that the scheme could increase costs in the global aviation industry by $23.8 billion in the next eight years.

The EU Parliament Environmental Committee said Tuesday that the suspension could only be prolonged if the ICAO made "clear and sufficient" progress.

Zou from the Civil Aviation Management Institute of China noted that simply imposing a fine would not solve the problem of carbon emissions, and the real solution lies in fundamental improvements in technology.