Government policies hold key to carbon-neutral skies

Tony Tyler says the aviation industry's plan to cut emissions needs help

PUBLISHED : Tuesday, 26 February, 2013, 12:00am
UPDATED : Tuesday, 26 February, 2013, 3:19am

Climate change is a top global priority. And the aviation industry takes its responsibility seriously.

Aviation's licence to grow is contingent on growing sustainably. Ensuring that is of vital interest to the global economy. Three billion passengers and nearly 50 million tonnes of cargo rely on aviation annually. This supports 57 million jobs and US$2.2 trillion of business. In Hong Kong alone, that's HK$133 billion of gross domestic product and 250,000 jobs.

Global connectivity creates possibilities for business, ideas and people to interact and create wealth. It is critical to foster this unique capability with alignment between government and industry to ensure aviation's sustainable growth.

Aviation has ambitious commitments to manage its 2 per cent share of global man-made carbon emissions. These include achieving carbon-neutral growth from 2020 and cutting net emissions in half by 2050 (compared to 2005 levels).

To achieve these commitments, we will need investments in new technology, more efficient operations and infrastructure, and access to global market-based measures. This is the aviation industry's four-pillar strategy on climate change.

The European Union's unilateral plan to include international aviation extraterritorially in its emissions trading scheme (a regional market-based measure) brought us to the brink of a trade war. Last November, the EU "stopped the clock" on implementation. That defused tensions and created the possibility for governments to agree on a global approach through the International Civil Aviation Organisation. In preparation for its assembly later this year, work is progressing in earnest on options for a global approach to market-based measures.

Finding a global agreement will not be easy. The politics of climate change runs deep and the stakes are high. But the consequences of failure present an untenable risk for all those who rely on aviation connectivity. In the absence of a global approach, governments will be free to act unilaterally creating an unco-ordinated patchwork of overlapping taxes and levies disproportionate and unrelated to the cost of carbon. It could cripple the industry.

Airlines are today building a compromise among themselves on how best to share the burden to achieve carbon-neutral growth. I am confident that government and industry processes working in parallel and with a common goal will produce a positive result.

But while market-based measures are necessary, the long-term solution for aviation's sustainable growth will come from technology, operations and infrastructure - the other pillars of the industry's strategy.

Sustainable biofuels are one example. Over their life cycle, they have the potential to reduce the industry's carbon footprint by up to 80 per cent. Since certification, some 1,500 commercial flights have been powered on biofuel. Why not more? The supply is small and the cost is high. There is a role for governments to foster research, reduce the risks of investment and establish financial incentives to support full commercialisation. That is not unlike the support that was given to solar or wind power.

Air traffic management is similar. Every day, unnecessary carbon emissions result from inefficient air traffic management. As with the market-based measures, governments must think beyond their borders to achieve effective solutions. Asia is on the right track with the "Seamless Asian Sky" initiative - a cross-border effort to accommodate growth sustainably.

There is no silver-bullet solution for aviation and climate change. Solutions cross the value chain and will require the co-operation of governments. The challenge is to align industry efforts with government policies. Together we can build a sustainable future. That's why the discussions at the Fifth Greener Skies Conference in Hong Kong today are so vitally important.

Tony Tyler is director general and CEO of the International Air Transport Association