Coalition of unwilling agrees on approach to EU’s ETS


Reuters

MOSCOW — Countries opposed to an EU law forcing the world’s airlines to pay for greenhouse gas emissions agreed on a basket of retaliatory measures, adding to a series of threats that have raised the prospect of the globe’s first carbon trade war.

But the EU dismissed the threats as “hypothetical” and Russia’s deputy transport minister also said the countries — which include China, India and the United States — were free to choose which of them they would actually use.

In Washington, the State Department said it would be “premature” to discuss specific retaliatory measures and voiced hope that the European Union would reconsider its carbon emissions scheme. The array of potential steps include barring national airlines from participating in the EU program, lodging a formal complaint with the United Nations’ International Civil Aviation Organization (ICAO), ceasing talks with European carriers on new routes and imposing retaliatory levies on EU airlines.

“Every state will choose the most effective and reliable measures that will help to cancel or postpone the implementation of the EU ETS (Emissions Trading System),” Valery Okulov, whose ministry hosted the meeting attended by more than 20 nations, told a news conference.

Russia has a particular measure it can use against Europe. Okulov, the former chief executive of Aeroflot, said Russia could take out an old weapon against European carriers: overflight fees on routes over Siberia. Russia rescinded the onerous fees during the last decade, a move it linked to long-running talks for World Trade Organization membership, which it received late last year.

Since the start of this year, all airlines using EU airports are required to buy permits under the ETS, although they will not actually face a bill until next year. In addition, they will at first be handed 85 percent of allowances for free. The European Commission reiterated it was standing by its law and said the Moscow meeting had delivered only negatives.