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U.K. Lawmakers Threaten to Ground Non-CO2 Compliant Planes

Jan. 26 (Bloomberg) -- Airlines using U.K. airspace should be grounded if they refuse to comply with the European Union’s greenhouse-gas emissions-trading system, according to a panel of lawmakers.

Any country or operator that refuses to accept EU carbon-trading rules on aviation could alternatively face an increased Air Passenger Duty tax in the U.K., the British parliament’s Energy and Climate Change Select Committee recommended.

“International airlines using U.K. and European airports must pay up for the carbon pollution they produce or risk having their planes grounded,” Tim Yeo, chairman of the committee, said yesterday in an e-mailed statement. “Aviation is one of the fastest-growing sources of climate-changing emissions, so the industry must accept responsibility.”

Aviation was included in the European carbon market, the world’s largest by traded volume, as of Jan. 1. The expansion sparked opposition from countries including the U.S., China and Russia, which said Europe should let the United Nations’ International Civil Aviation Organization decide on greenhouse-gas limits for the industry.

The price of permits has dropped 49 percent to 7.75 euros ($10.18) a metric ton in the past year, on muted demand and surging supply.

“The U.S. needs to recognize that if it wants to do business in the world’s largest single market, it is going to have to get serious about tackling climate change,” Yeo said.

The ICAO said in November it wants to strike a deal to create a global carbon market for the airline industry this year.

To contact the reporter on this story: Mathew Carr in London at m.carr@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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