US bill targeting EU emissions fees for airlines

The US House of Representatives' backing for a bill to bar American airlines from paying for greenhouse gas discharges under the Eur-opean Union emissions-trading plan may lead to a trade war, an environment lobby said. The House Monday passed the ‘European Union Emissions Trading Scheme Prohibition Act of 2011' after the industry estimated that participation in the cap-and-trade system would cost US airlines $3.1 billion (Dh11.38 billion) between 2012 and 2020. The US move comes five weeks before the start of a United Nations summit to debate post-2012 climate-protection rules, highlighting the challenge of ironing out a global agreement to put a price on carbon and prevent global warming. "This bill could ignite a trade war that would put tens of thousands of US jobs in jeopardy," Annie Petsonk, international counsel at the New York-based Environmental Defence Fund, said in an e-mailed statement. "By barring US-based airlines from complying with applicable law for flights travelling to EU airports, this bill would compel those airlines either to drop their EU routes or become scofflaws." Pollution limits The 27-nation EU decided in 2008 that aviation should become a part of its carbon programme as of next year after airline discharges in Europe doubled over two decades. The bloc's emissions trading system, known as the ETS, is the cornerstone of the region's plan to cut greenhouse gases that scientists blame for climate change. It imposes pollution limits on more than 11,000 manufacturers and power companies, leading to a cap in 2020 that will be 21 per cent below 2005 discharges. When international carriers join the system next year they will be given emission permits making up 85 per cent of the industry cap for free and will have to buy the remaining 15 per cent at auctions. One allowance carries the right to emit one metric ton of carbon dioxide. EU Climate Commissioner Connie Hedegaard said last month that the bloc won't ditch its plans to impose carbon curbs on flights to and from the region's airports starting next year in the face of mounting opposition from international carriers. Senate approval needed "The House passing this bill is like another nation saying: We don't care if the US has a law enacted by Congress and upheld by the US courts — we're going to prohibit our companies from complying," Environmental Defence Fund's Petsonk said. "It's unlikely that our Congress would let that kind of action go without retaliation." The bill must be approved by the Senate and signed by President Barack Obama to become law.