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Thursday, April 12, 2012

Climate Change Committee Pressures UK On Carbon Change Commitments - Tax-News Global Tax News

Posted - 11 April 2012 - by Jason Gorringe, Tax-News.com, London

A new report from the Committee on Climate Change (CCC) urges the United Kingdom government to include the aviation and maritime sectors within ambitious emissions targets agreed for 2050.
The report states there is 'no longer any reason to exclude international aviation and shipping emissions' from carbon reduction targets, set out in the Climate Change Act, which targets an economy-wide 80% reduction in carbon emissions by 2050, against 2005 levels. The Act was drawn up in 2008, but the two sectors were excluded from its scope on a technicality.
The report challenges the UK government to deliver on commitments made to establish a low-carbon economy. The report warns that unless aviation and maritime emissions are given robust targets, additional compensatory pressures will be placed on other polluting sectors. The UK government however is reluctant to place burdens on the economic growth-fuelling sectors, particularly in light of the backlash received when Europe recently introduced its Emissions Trading programme on international aviation. The report, however, advocates the government adopt a long-term outlook on the issue.
Analysis in the report, supported by other studies, says that the impact on economic growth would be negligible, with the report underscoring that the 2050 target can be achieved at a cost to economic growth of between 1-2% of Gross Domestic Product - a cost accepted by Parliament when the Climate Change Act was first legislated. Conversely, the report warned of 'the much higher costs and consequences from not acting to reduce emissions'.
The report says that the inclusion of these sectors - with performance pegged to European and International targets - would add no new commitments or costs in aviation, shipping or other sectors of the economy, as failure to meet energy-efficiency improvements will mean greater costs; in terms of payments for permits under the Emissions Trading Scheme for aviation operators, and under measures, including the Energy Efficiency Design Index, adopted by the International Maritime Organization, for maritime operators.
The report says: “In order to mitigate this risk [of failing to meet carbon reduction targets], the Committee recommends that the current approach should be formalized through including international aviation and shipping emissions in carbon budgets and the 2050 target, therefore providing more certainty that it will be continued in future.”
On the long-term path for aviation emissions, the Committee recommends that the aim should be for emissions in 2050 that are no higher than 2005 levels. "Given scope for increased fuel and carbon efficiency of flying, this would allow some demand growth over the next four decades. The Committee suggests that this path should be delivered through EU and global policies rather than a unilateral UK approach, in order to avoid competitiveness impacts that could otherwise ensue.”
Chair of the CCC, Adair Turner, commented:
“Including international aviation and shipping emissions in UK carbon budgets has an importance which goes beyond the specific issue of international aviation and shipping. This report makes a recommendation which, if now accepted by government and Parliament, will complete the UK statutory framework.”

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