Including aviation emissions in the EU ETS: Much ado about nothing? A review

The European Community, motivated by the rapid growth of the aviation industry and related impacts on climate change, has decided to include aviation in the European Emissions Trading Scheme (EU ETS). Mitigation policies such as the EU ETS are considered to be necessary in order to change travel behaviour and induce operational and technological changes in the aviation industry that will result in lower environmental impacts. This paper reviews the available impact assessments of the proposed emissions trading scheme for airlines published between 2005 and 2009. It analyses the methods used and finds that the models used are often over-simplified, omitting important variables or that the reliability and robustness of the modelling results are reduced by linking models that are based on different assumptions. The paper also summarises the possible environmental (CO₂ emissions) and economic (air fares, demand for airline services, supply of airline services, competitiveness, GDP, carbon price) impacts in the studies reviewed for the year 2020. Overall, the effects are found to be small: for example, CO₂ emissions are expected to decline by a maximum of 3.8% and the maximum impact on GDP in the EU was found to be ?0.002%. The reasons for these insignificant impacts are analysed in this paper; it is also found that there are some positive aspects of including aviation in the EU ETS.     

The potential for European aviation CO2 emissions reduction through the use of larger jet aircraft

There is increasing pressure to reduce global CO₂ emissions, with aviation targeted as an industry with high future expected growth and limited potential for reduced emissions. In Europe, air transport is likely to be included in the Emissions Trading Scheme from 2012, allowing open trading with other sectors. The proposed scheme may be economically efficient but will it do much towards curbing aviation emissions? A number of papers have looked at the ETS impact on air traffic growth rates, and others have forecast the rate of likely future fuel efficiency gains. This paper examines the potential for greater fuel efficiency through the use of larger aircraft and different patterns of operation. Fuel efficiency was found to be related to aircraft size with more benefit from trading up with short/medium-haul than with long-haul aircraft. This relationship only held for long-haul aircraft if those aircraft with two main decks were removed from the sample (these types showing inherently lower fuel efficiency). Combining these findings with manufacturers' and other forecasts of average aircraft size suggests that less than 1% a year of fuel efficiency gains will be available from this source over the next 20 years.     

How to regulate aviation's full climate impact as intended by the EU council from 2020 onwards

The EU Council intends to regulate air transport's full climate impact (i. e., CO₂ and NO_x, H₂O, SO_x, aerosols, contrails and contrail cirrus). A likely approach is the inclusion of all climate relevant species from aviation in the European Emissions Trading Scheme. We provide a proposal for this practice and analyze the economic impacts. Modelling results indicate that the cost effects of the EU-ETS addressing CO₂ and non-CO₂ emissions will be much larger than under the current scheme. This is because under the new approach, all climate relevant species are regulated and not just CO₂. The cost effects also depend on the length and altitude of the flight. Both have consequences for the competitive environment of the airlines under the scheme. Especially the full service network carriers will have to bear a competitive disadvantage compared to airlines offering just short- and medium-haul services. Remarkably, some cost effects are in opposition to the corresponding results for an ETS for the regulation of CO₂ alone.     

Will the EU-ETS instigate airline network reconfigurations?

Based on the proposal of the European Commission on including the aviation sector into the European Emission Trading Scheme, a route-based analysis is conducted simulating cost and demand implications for selected airlines. For a scenario of €20/tons CO₂, results indicate that the EU-ETS CO₂-based cost increases for the airlines are between €9 and €27 per route and therefore, as an individual factor, are not high enough to instigate major route reconfigurations among European airlines.     

CO2 emissions associated with hubbing activities in air transport: an international comparison

Hubbing is an important operational practice in air transport. Many studies have been conducted to examine the benefits and impacts of hubbing from an economic perspective. However, its impact on CO₂ emissions, especially across different air spaces, is not well understood. This paper explores the impact of hubbing activities in air transport from an environmental perspective. With a detailed methodology and data from the Greek and Hong Kong/Sanya flight information regions (FIRs), three levels of CO₂ emissions are estimated: airport-based, airspace-based and flight-based. After contrasting the CO₂ emission efficiencies of Athens International Airport (AIA) and the Hong Kong International Airport (HKIA), aircraft type and flight distance are examined to explain their emission efficiency differences. It is found that HKIA is associated with poorer CO₂ emission efficiency at the airport and airspace levels because of the larger aircraft and longer flight distance. However, when CO₂ emission efficiency at the flight level is considered, HKIA, with a higher passenger load factor, performs better. Major international hub airports should implement additional environmental measures to minimize the impact of hubbing activities on CO₂ emissions at the airport and airspace levels.     

Investigations on the distribution of air transport traffic and CO2 emissions within the European Union

This study analyses the structure of air traffic and its distribution among the different countries in the European Union, as well as traffic with an origin or destination in non-EU countries. Data sources are Eurostat statistics and actual flight information from EUROCONTROL. Relevant variables such as the number of flights, passengers or cargo tonnes and production indicators (RPKs) are used together with fuel consumption and CO₂ emissions data. The segmentation of air traffic in terms of distance permits an assessment of air transport competition with surface transport modes.The results show a clear concentration of traffic in the five larger countries (France, Germany, Italy, Spain and UK), in terms of RPKs. In terms of distance the segment between 500 and 1000 km in the EU, has more flights, passengers, RTKs and CO₂ emissions than larger distances. On the environmental side, the distribution of CO₂ emissions within the EU Member States is presented, together with fuel efficiency parameters. In general, a direct relationship between RPKs and CO₂ emissions is observed for all countries and all distance bands. Consideration is given to the uptake of alternative fuels. Segmenting CO₂ emissions per distance band and aircraft type reveals which flights contribute the most the overall EU CO₂ emissions. Finally, projections for future CO₂ emissions are estimated, according to three different air traffic growth and biofuel introduction scenarios.     

An analysis of the greenhouse gas emissions profile of airlines flying the Australian international market

International commercial flights (with the exception of flights between countries in European Union including Iceland, Norway and Liechtenstein) are currently not subject to greenhouse gas emission reduction regulation. To formulate effective and efficiency policy to manage greenhouse gas emissions from air transport, policy makers need to determine the emissions profiles of all airlines currently flying into their country or region. In this paper, we use 2012 data on airlines' aircraft characteristics, passenger load and cargo load (obtained from statistics reported by Australian Government Bureau of Infrastructure, Transport and Regional Economics) to estimate the volume and carbon efficiency on each international route flying to and from Australia. This is the first study to use actual passenger and cargo load data to determine the greenhouse gas (specifically CO₂) efficiency of airlines operating in the Australian international aviation market. Airlines' CO₂ emission profile is dependent on many factors including but not limited to the aircraft used, payload, route taken, weather conditions. Our results reveal that the airlines’ CO₂ emission profile is not only dependent on the aircraft used and the number of passengers but also the amount of cargo on each flight.     

Assessment of transport emissions impact and the associated social cost for Chengdu,China

Chengdu, the capital city of Sichuan province, is the fourth biggest city in China with over 15 million residents and 3.4 million vehicles. In Chengdu, transport and other mobile sources accounted for over 27% of the city's PM_2.5 emissions (CDEPB, 2016), posing negative impacts on public health, local environment, and the climate. This study estimated impacts from transport-related emissions (CO₂, CH₄, N₂O, PM₁₀, PM_2.5, NO_X, SO_X, CO, and HC) and evaluated the associated social cost for Chengdu from 2005 to 2013. The study also assessed the city's transport performance in terms of its eco-efficiency with the socioeconomic and environmental concerns. The activity-based methodology was adopted to produce the emission inventories, while utilizing meta-analysis and localizing the emission social cost factors based on Chengdu's economic and demographic reality to support social cost assessment. The study marks the first attempt in literature to evaluate Chengdu's transport emission social cost. The following were observed in the study: (i) in 2013, the social cost of all transport emissions in Chengdu was around US$3 billion, with the lowest estimate of US$449 million and the highest estimate of US$4.7 billion; (ii) trucks, private cars, and motorcycles were the major contributors, while NO_X, PM_2.5, and CO were the key pollutants to public health; (iii) if GHGs (CO₂, CH₄, and N₂O) were excluded, the upper range of social cost of transport air pollutants would be from US$2.4 billion to US$4.1 billion, or 1.6%–2.8% of the Chengdu's GDP.     

Analysis of CO2 emissions for island ferry services

In this study CO₂ emissions are calculated for ferries operating on both short and long range sea routes between mainland Scotland and the Orkney Isles. CO₂ emissions for land transport options connecting with the respective ferry services are also analysed. In particular the study offers a comparison of transport CO₂ emissions for long-range ferry services between Aberdeen and the Orkney Islands and short-range ferry services across the Pentland Firth. The latter involve a longer road journey for vehicles than the former. The results indicate significantly greater CO₂ emissions for long-range ferry services, despite shorter road connections. Existing public policy in this regard specifies and subsidises higher CO₂ emission ferry services operating on longer sea routes, to the disadvantage of non-subsidised short crossing services, the latter offering much lower CO₂ emission impacts (inclusive of connecting land transport CO₂ emissions). This suggests that policymakers need to focus on assessing CO₂ emission impacts when considering future tenders for subsidised ferry services. Findings also suggest that, for modest sized ferries serving islands, the optimal solution may be to use/specify the shortest possible sea routes in order to reduce CO₂ emissions from transport.     

Aviation and the environment in the context of the EU–US Open Skies agreement

We examine the impacts of the EU–US Open Skies agreement on the environment on emissions from the aviation sector. We use the Hamburg Tourism Model of domestic and international tourist numbers and flows, to estimate these impacts. The Open Aviation Area will result in increased competition between carriers and falls in the cost of transatlantic flights. This will not only have implications for the size and structure of the industry but also for climate policy. The paper assesses what effects the expected increases in passenger numbers will have on CO₂ emissions and tests whether this increase in travel will result in a corresponding rise in emissions. Simulations show that passenger numbers arriving from the US to the EU will increase by between 1% and 14% depending on the magnitude of the price reductions because of substitution between destinations, the percentage increase in global emissions is much smaller (max. 1%) than the increase in cross-Atlantic traffic.     

A transport carbon footprint methodology to assess airport carbon emissions

Airports are important nodes in the air transport system, but also local sources of environmental impacts. Emissions of CO₂ are among the most relevant ones because of their potential greenhouse effects. Many policies and guidelines have been identified at national and world level to reduce such kind of impacts. In this paper, a Transport Carbon Footprint methodology has been set to identify Unit Carbon Footprints (UCFs) linked to some identified emission macro-sources – i.e., land vehicles, on-ground aircraft, airport handling and terminal equipment – to compute the contribution of the single macro-source to the total amount of CO₂. Particularly, UCFs due to transport activities have been defined according to some relevant transport variables. The computation of UCF values for a given airport allows computing both the contribution of each macro-source and also evaluating the effectiveness of transport-related actions aiming at reducing the carbon impact. The methodology has been applied to the airport of Bologna, in Northern Italy, and its UCF values for the identified macro-sources have been computed.     

Emissions trading for international aviation—an estimation of the economic impact on selected European airlines

International aviation is responsible for between 2.5% and 3% of anthropogenic carbon dioxide (CO₂) emissions that are partly held responsible for climate change. International aviation is not subject to any regulatory framework for the limitation of these emissions. From an economic point of view, the introduction of an emissions trading scheme would be an appropriate instrument to limit these emissions. This paper outlines the possibilities on how aviation could be included in existing emissions trading schemes and gives an overview on the current political discussion. It continues with an empirical estimation of the impacts on operating costs and transport demand for low cost, full service, holiday and regional airlines taking Ryanair, Lufthansa, Condor and Air Dolomiti as examples, under three different design options for an emissions trading scheme. Finally, conclusions about the impacts on intra-European and worldwide airline competition are drawn.     

Integrated airline productivity performance evaluation with CO2 emissions and flight delays

This paper evaluates the airline productivity change by applying a modified global Malmquist productivity index (GMPI) model, incorporating both CO₂ emissions and flight delays. Statistical inference is also performed on the GMPI results using the bootstrapping method. Empirical research was conducted on 15 international airlines during 2011-2017. The obtained results showed that the productivity of all airlines had been fluctuating and experienced a slight increase over 2011–2017. Most of these 15 airlines made more progress in managing punctuality than CO₂ emissions. High punctuality policy may not be the best choice for all airlines when considering financial constraints, while airlines in more liberalized aviation markets are more likely to improve productivity by reducing flight delays. Efficiency change and technological change were the major driving factors for the growth of airline productivity. European and US airlines benefitted more from superior technology, while most Asian and Oceanian airlines still benefitted from the advantage of efficiency. Based on the findings, specific management advice was given.     

Apportioning aviation CO2 emissions to regional administrations for monitoring and target setting

Delivering reductions in greenhouse gas emissions from the aviation sector requires support and action from all tiers of government. There has been considerable focus on the policies that can be implemented at international and national levels; however, sub-national bodies can also play an important and influential role. In order to identify what this role may be, it is important for sub-national governments to have an understanding of the size of their potential emissions responsibility. At present there is no widely accepted methodology for the apportionment of either international or domestic aviation emissions to sub-national levels. This paper assesses a number of existing consumer- and producer-based CO₂ apportionment regimes that could be used to allocate the emissions from aviation to regional and other sub-national levels. This is followed by the presentation of a new hybrid consumer–producer apportionment regime applicable to aviation. This new approach is designed to provide an emissions baseline for a region that reflects its share of responsibility for the UK’s aviation emissions as both a producer of emissions and consumer of the services provided by aviation.     

Flying into the future: A scenario-based analysis of carbon emissions from China's civil aviation

Aviation emissions will significantly affect climate change with the continued growth of the air transport. This study decomposes the drivers influencing China's civil aviation carbon emissions change in the period from 1985 to 2015. Emission trends are predicted using a Monte Carlo simulation. The results show a peak and reduction in the period between 2016 and 2030. Results also show that air transportation revenue growth is associated with increasing historical carbon emissions, while rising industry energy intensity significantly hampers carbon emissions reduction. The carbon intensity (CI) reduction goals were achieved in the different scenarios before 2020, but the carbon emissions peak target before 2030 can only be achieved under the technological breakthrough scenario (TBS). The reduction of air transport growth rate and promotion of new energy technologies are two essential strategies to reduce carbon emissions in the foreseeing future.     

Introducing a transport carbon dioxide emissions vulnerability index for the Greater Dublin Area

Energy consumption and carbon dioxide emissions from the transport sector have continued to rise, adding to growing concerns about the environmental impacts caused by transport systems and related land-use patterns. The transport sector in Ireland is a significant fuel consumer, accounting for 36% (5771 kTOE3) of Ireland’s primary energy demand in 2007. The sector was responsible for 36% (17,014 kt5 CO₂) of Ireland’s energy-related CO₂ emissions, higher than any other sector. Energy use in the transport sector grew by 181% (6.3% per annum on average) between 1990 and 2007. A key characteristic that distinguishes energy use in transport is the almost total dependence on imported oil as a fuel – over 99%, EPA (2009).Given the levels and growth of energy demand in transport, there is a clear imperative for policymakers to develop and implement measures and programmes that maximise energy efficiency and renewable-energy penetration. In this paper we develop a transport carbon dioxide emissions vulnerability index, using the Census of Population of Ireland 2006 Place of Work – Census of Anonymised Records (POWCAR) Dataset. The transport carbon dioxide emissions vulnerability index will be developed for the Greater Dublin Area to represent spatially in terms of transport carbon emissions the regional differentiations in commuting distances and modal shares. The results of this research can then be used to assess the transport carbon dioxide emissions of future development plans and therefore allow greater transport sustainability to be achieved through improved design of the location and form of major new development.     

Greenhouse gas emissions from flying can offset the gain from reduced driving in dense urban areas

Numerous studies have illustrated how denser urban forms lead to smaller greenhouse gas (GHG) emissions from passenger transport. Many of these studies have excluded aviation since the association between urban structure and air travel is not as intuitive as it is the case of ground travel. However, several recent studies have concluded that air travel is a significant contributor to the GHGs from passenger transport. Furthermore, even air travel habits depend heavily on lifestyles and socio-economic factors that are related to the urban form. Here we analyse the interactions between urban structure and different transportation modes and their GHG impacts in Finland. The study utilises the data from the Finnish Transportation Agency’s passenger traffic survey from May 2010 to May 2011, which includes over 12 000 people and over 35 000 trips. The survey is based on one-day travel diaries and also includes additional data on long-distance trips from a longer period. Methodologically, the study takes a traveller’s perspective to assess the GHG emissions from passenger transport. We found that (1) air travel breaks the pattern where GHG emissions decrease with increasing density of urban structures, and (2) in the metropolitan region there is a clear trade-off between car-ownership and air travel in the middle income class. The main policy implication of our study is that air travel must be included in GHG assessments and mitigation strategies targeting travel behaviour. In dense urban regions, the emissions of air travel have the potential to offset the gain from reduced private driving.     

The implications of environmental costs on air passenger demand for different airline business models

Various environmental measures, including both regulations and fiscal instruments, have been used at airports globally to reduce the impacts of aircraft noise as well as aircraft engine emissions. Internationally, it is recognized that the costs of environmental and social externalities of air transport must be internalized and paid for by the aviation industry and its users. The use of noise related charges or taxes, which theoretically should be based on their respective social costs, has been proved to be effective at some European airports. This research aims to investigate the impacts of environmental costs, through environmental charges, on air passenger demand for different airline business models. The paper presents the mathematical models measuring the social costs of aircraft noise and engine emissions as a basis for setting up environmental charges. Six intra-European short-haul routes in two city pairs, namely London–Amsterdam and London–Paris, are selected for the empirical analysis. The environmental charges are then hypothetically applied to airlines with two different business models, full service carriers (British Airways and Air France-KLM) and low cost airlines (EasyJet). The results show that the potential percentages of demand reduction for both leisure and business passengers would be higher for Easyjet's markets, although with less environmental cost per passenger.     

Hinterland operations of sea ports do matter: Dry port usage effects on transportation costs and CO2 emissions

Decreasing carbon dioxide (CO₂) emissions is one of the most important tasks for the society in the 21st century. One possibility to decrease emissions originating from transportation is to utilize more rails instead of relying simply on road transportation. In the dry port concept an inland intermodal terminal is connected to a sea port using railways. This study analyzes impacts of dry ports in a Finnish context. We compare two different configurations: In the first one shippers drive directly to a sea port, while in the second one they use dry ports. The systems are evaluated by using discrete-event simulation. In the systems we are interested in two issues: (1) Level of CO₂ emissions, and (2) Costs to transport the goods in different configurations. We use different scenarios for future energy prices and estimate both the costs and CO₂ emission development in these scenarios. We also compare the results to a situation, where emissions are minimized instead of costs. Implications on larger scale are also discussed, for example in the Baltic Sea and North Sea area, where strict sulfur emission restrictions are seen to harm sea transport and increase concentration on small number of sea ports.     

Carbon dioxide emissions and inland container transport in Taiwan

The aim of this study is to estimate the carbon dioxide (CO₂) emissions from inland container transport during the time period of 1998-2008 and predicts the trend of these emissions. The analyses show that the CO₂ emission from inland container transport in 1992 reached 1.03 million tonnes, and the figure drastically increased by 89.3% to 1.95 million tonnes in 2008. Using a multiple regression model, gross domestic product (GDP) and oil price are found to be the key drivers for CO₂ emission. The CO₂ mitigation strategies are discussed in the policy suggestions given that Taiwan is warming at twice global average rate.