ETS in the aviation sector: provisions to ensure legal certainty have been extended

On 21 June 2017, EU Ambassadors agreed on the Council’s negotiating position to prepare for the implementation of the global market-based measure as of 2021 and to extend existing provisions covering  aviation activities, notably in the EU emissions trading system (ETS) regulation beyond 2016.

The emissions trading scheme (ETS) was launched in 2005 and aims to promote the reduction of greenhouse gas emissions at EU level. In 2014, in order to facilitate progress in the negotiations within the International Civil Aviation Organisation (ICAO) and in the hope of achieving clarity as regards emissions from international flights connecting the European Economic Area (EEA) and third countries, the EU decided to reduce the scope of the ETS scheme to apply only to flights within the EEA, until the end of 2016. The ETS reform is currently under negotiation for the 2021-2030 period.

The global market-based measure was introduced in 2016 by the ICAO agreement, and aims to slow the growth of greenhouse gas emissions in the aviation sector and stabilise the numbers at 2020 levels, as well as regulate international aviation emissions through an offsetting system, also referred as CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation). In 2027, the application of the measure will be compulsory for major aviation countries, but countries will have the opportunity to participate since 2021.

The Commission proposal for a new regulation is the response to the agreement reached in 2016. The proposal must be adopted by 2017 to avoid a legal gap with regard to compliance with the current ETS regulation. The agreement found within the Council supports the main elements of the Commission proposal:

  • prolong the derogation for non-intra EEA flights;
  • set out provisions for a review in view of the implementation of the global market-based measure within the EU;
  • foresee the application of the Linear Reduction Factor (LRF) to aircraft operators from 2021 onwards in the aviation sector.

The draft report of the proposal will be voted in the European Parliament, in the ENVI Committee (Environment, Public Health and Food Safety) on 11 July; a plenary vote is not expected until September.


Davide Scavuzzo