Obama quietly signs bill shielding airlines from carbon fees in Europe

President Obama has signed into law a bill that requires U.S. airlines be excluded from European carbon emissions fees.

Environmentalists had framed the bill as the first test of the president’s commitment to fighting climate change in his second term and urged him to veto it. Obama quietly signed it Tuesday over their objections.

“The Obama administration is firmly committed to reducing harmful carbon pollution from civil aviation both domestically and internationally, but, as we have said on many occasions, the application of the EU [Emissions Trading System] to non-EU air carriers is the wrong way to achieve that objective,” a White House spokesman said in a statement to The Hill.

The spokesman said the Obama administration will work to address airline emissions at the “the appropriate multilateral forum — the International Civil Aviation Organization.”

The U.S. airline industry lobbied heavily for passage of the legislation, arguing that the European Union rules were unfair because they would have been applied to the entire length of flights to European destinations, not just the time spent in EU airspace.
Under the emissions trading system, airlines would have had to trade credits for pollution emitted by flights in a system that is similar to cap-and-trade proposals that environmentalists have pushed in the United States.

Earlier this month, the EU put the emission fees on hold for a year to buy time for a global agreement on aviation emissions. The rules were not frozen for airlines in the EU, however.

Sen. Claire McCaskill (D-Mo.), a Democratic sponsor of the bill exempting U.S. airlines from the fees, said Obama’s decision to sign the bill was a win for airline customers.

“It never made a bit of sense for European governments to tax our citizens for flying over our own airspace — and with the passage of this law we’ve got the tools we need to prevent it from happening and protect American jobs,” she said in a statement.

McCaskill’s Republican co-sponsor on the bill, Sen. John Thune (R-S.D.), said it will shield American carriers from an “illegal tax.”

“American sovereignty will no longer be threatened by the E.U.’s illegitimate and disingenuous ‘environmental’ tax on our country,” Thune said in a statement. “My bill will ensure that we protect U.S. air carriers and passengers from this illegal tax, freeing up billions of dollars that can instead be invested in creating jobs, modernizing or purchasing new aircraft and stimulating our own economy.”

Airlines had said they would have had to make their first payments in the EU emissions system in the spring of 2013. The rules, which were first applied to the aviation industry this year, called for airlines to reduce their emissions from 2006 levels by 3 percent by 2013 and 5 percent by 2020.

The White House had been under pressure from environmental groups to veto the bill. Those advocates want Obama to address climate change more forcefully in his second term, and said the emissions bill provided an opportunity to chart a new course.

The New York-based Environmental Defense Fund called the emissions ban “[a]t best … simply superfluous” when it was approved by lawmakers earlier this fall.

But the World Wildlife Fund adopted a more measured tone on Tuesday.

“WWF called for a veto of this bill and we are disappointed that it passed,” WWF Director of International Climate Policy Keya Chatterjee said in a statement.

“However, there is a silver lining here — the administration has appointed high level representatives to pursue a global solution for aviation and climate,” Chatterjee said. “The White House now must endorse a global, market-based measure to rein in carbon pollution from aviation. If they do, we are optimistic that the U.S. can work with ICAO to develop a package of policies that will reduce our share of global emissions.”

The industry group Airlines for America said the law will allow carriers to reduce emissions through international agreements.

“With the President’s signature today, the United States has sent an unequivocal signal to the EU and the world that while the illegal and unilaterally-imposed EU ETS is the wrong way to proceed, there is a steadfast commitment to the right way — a global sectoral approach at the international level,” A4A President Nicholas Calio said.

“Working within the framework of the International Civil Aviation Organization, the United States will continue to lead the effort to secure a policy that will meet the twin goals of allowing for industry growth and continuing improvements in fuel efficiency and reduced emissions,” Calio continued.
The Hill, November 27, 2012