Administering Aviation EU-ETS and the Future State of the Program

> | February 13, 2012 | 1 Comment
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This business aviation blog post is part of a series on EU-ETS for business aviation and continues from our last post entitled: EU-ETS for Business Aviation: Implementation, Costs, and Risks of Non-Compliance.

For business aviation operators, European Union Emissions Trading System (EU-ETS) requirements can be complex. Recent changes to the requirements have made them even more so. When completing documentation required for the EU-ETS program, operators must consider the administrative workload. Compliance with these regulations is necessary to preserve your international operating freedom. Be aware that enforcement actions for non-compliance are likely to be applied more rigorously in future. Given the importance of compliance, the following are some answers to frequently asked questions regarding recent events surrounding this program.

1. What does it take to administer?

You have the option of tackling EU-ETS requirements on your own but you’ll still need to hire an accredited 3rd-party verifier and you’ll have administrative costs. While information is available to help you with EU-ETS regulations, this can be a complicated program to follow. You can reach out to help desks with EU member states, but they may only supply you with technical information. It’s beneficial – and cost-efficient – to have an experienced 3rd-party provider help you navigate through the EU-ETS process and handle administrative requirements.

The following is a general outline on what you must do as an operator to administer EU-ETS annually:

  1. Monitor emissions all year to compile information for reporting. The numbers are to be calculated using the appropriate EUROCONTROL Small Emitters Tool version for the applicable year. For reference, here is the 2012 tool.
  2. Report emissions information and supporting documentation to an accredited 3rd-party verifier.
  3. Submit the verified emissions report to your member state via channels they require.
  4. Wait for your member state to approve the submitted report.
  5. Purchase the required carbon credits.

2. Are operators permitted to do EU-ETS benchmarking, or has this period expired?

The carbon emissions benchmarking period expired in 2010. Before, if you qualified for credits, you could use them for the next year and beyond. The results of benchmarking were underwhelming: U.S.-based corporate operators only qualified for 1-2% of carbon credits for free. On the other hand, scheduled commercial carriers received upwards of 85% of their required carbon credits for free. This is because EU-ETS uses a payload-based ratio. General Aviation (GA) typically flies long distances but carries little payload. The EUROCONTROL Small Emitters Tool uses a standard payload figure of 100 kilograms per passenger. Checking with your member state for future benchmarking opportunities is suggested.

3. Does the recent U.S. House of Representatives decision on EU-ETS regulation have any effect on my operations?

While the U.S. Congress has passed a bill regarding EU-ETS, it hasn’t been approved by the Senate or signed by the president (at the time of this post). However, even if it is approved by the Senate and signed by the president, it can not affect sovereign EU law. There isn’t any action the U.S. can take to end EU-ETS responsibilities of corporate operators outside the EU, short of negotiating settlements with every EU member state. EU-ETS is not an International Civil Aviation Organization (ICAO) directive. Therefore, the Federal Aviation Administration can not file a difference with ICAO.

4. Can we anticipate changes to the current implementation of EU-ETS?

The European Commission has talked about raising the Small Emitters Tool’s thresholds from 10,000 tons of CO2 to 50,000 tons, but that will not impact GA. Only a very small number of GA operators are teetering on the edge of 10,000 tons of CO2 emissions, whereas many corporate operators (flying 20 reportable flights or less) emit less than 1,000 tons of CO2 annually.

So far, we’ve seen few fines issued for purposeful non-compliance. However, we expect compliance enforcement to increase now that we have entered the “live” EU-ETS period in 2012. Member states will keep records of operators who are non-compliant, which can have negative consequences, both financial and operational in nature.

Conclusion

Best practice is to be proactive in meeting EU-ETS compliance requirements in order to maintain and preserve operating flexibility to, from and within the EU. Penalties and EU-ETS enforcement measures will only increase over time. Know which flights are reportable under EU-ETS and be up-to-date on monitoring. Even if you make just one flight to the EU this year or next, you’ll be subject to EU-ETS reporting. Avoiding operations to the EU is not a practical solution. To make things easier, you can have an experienced 3rd-party provider look after most of the administrative details, help preserve your international operating flexibility and provide a straightforward road map to manage the EU-ETS process.

If you are looking for more information on how to comply with EU-ETS or if you would like to subscribe to EU-ETS activity reminders, you can visit our free EU-ETS Reporting Resource Center.

Questions?

If you have any questions about this article, contact me at adamhartley@univ-wea.com.

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About

Since the European Union first announced plans to implement its Emissions Trading Scheme (EU-ETS) in spring 2009, Universal® Team Manager for Universal’s Charter teams Adam Hartley has established himself as an expert at helping operators comply with this complicated and ever-changing regulation. Adam’s passion is helping operators complete their emissions monitoring plans, and he has established himself as the "go-to" person on this topic. Adam’s expertise has earned him numerous invitations to speak both domestically and internationally at major industry events and conferences. Although he is best known for his EU-ETS knowledge, Adam’s expertise extends to other areas of regulatory compliance issues, such as TSA waivers, border overflight exemptions, all CBP/APIS notifications, the universal visa waiver program and more. Adam has been featured in numerous industry trade publications and has contributed guest editorials to Professional Pilot, BART, World Aircraft Sales and Altitudes. You can reach Adam at adamhartley@univ-wea.com.

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