ICAO 2013 Environmental Report - page 150

icao environmental report
market-based measures
Annie Petsonk
Guy Turner
In 1997, the Parties to the United Nations Framework Convention
on Climate Change (UNFCCC) acknowledged the responsibility of
the International Civil Aviation Organization (ICAO) for addressing
greenhouse gas (GHG) emissions from international aviation
. After
years of consideration, in 2010 the 37
ICAO Assembly adopted
a resolution including,
inter alia
, a goal of improving fuel efficiency
2% per year through 2020; aspirational goals for improving fuel
efficiency 2% per year through 2050 and stabilizing international
aviation’s net carbon emissions by 2020; and requested that
the ICAO Council explore the feasibility of a global market-based
measure (MBMs) to achieve the stabilization goal.
In June 2013, the International Air Transport Association (IATA)
passed a resolution supporting a mandatory global carbon
offsetting programme to achieve carbon neutral growth from 2020.
Against this backdrop, we address four questions below:
• How big is the emissions gap?
• Where might carbon units come from to offset that gap?
• How much might that cost?
• What are the environmental integrity and administrative
issues of various types of offsets?
How big is the gap?
Any estimate of the emissions gap first requires a projection
of international aviation emissions absent an MBM. This in
turn depends on many factors including: growth in demand
for international air travel, the number and type of planes
used to meet this demand, technical improvements in aircraft
efficiency, fleet replacement phasing, improvements to air
traffic management systems, and fuel mix, including biofuels.
Uncertainties in these factors generate a wide range of projec-
tions for the cumulative emissions gap. The latest estimate for
the “central” scenario from ICAO’s Committee on Aviation and
Environmental Protection (CAEP) shows a gap ranging between
14 and 21bnt
(billion tonne) over the 30 years from 2020 to 2050.
Assuming a conservative potential contribution from alternative
fuels the range would be 13bnt to 20bnt
Analytical scenarios can generate estimates of the potential
cost and carbon market implications of addressing this gap via
a global MBM. Of course, these scenarios depend on, among
other things, estimates of the marginal abatement cost (MAC)
for in-sector emission reductions, assumptions about sources
She is International Counsel
at the Environmental Defense
Fund (EDF), an 800,000-member
advocacy organization that
develops innovative, econom-
ically sensible solutions to environmental problems.
Annie focuses on creating markets that provide
incentives for people to protect the environment,
and that foster innovation. She has published
extensively on economic incentives to tackle
climate change, including for the aviation sector.
She teaches as a member of the adjunct faculty
at the George Washington University Law School.
Prior to coming to EDF, Annie served in the U.S.
government, including the Executive Office of the
President; in the United Nations; and in the private
sector. She is a graduate of Harvard Law School
and the Colorado College, which awarded her an
honorary degree.
guy turner
He is Chief Economist and
Director of Commodity Research
in Bloomberg New Energy Fi-
nance. In this capacity he is
responsible for global analysis
and business performance across power, gas and
carbon markets as well as economic forecasting
for all markets and geographies. Mr. Turner also
manages the company’s global consulting business.
He joined New Energy Finance in 2006 to set up
New Carbon Finance – the business dedicated to
forecasting the world’s carbon markets and now
absorbed into Bloomberg New Energy Finance
– and he was part of the management that sold
the company to Bloomberg in 2009. He has over
22 years experience as a consultant and business
manager in the fields of environmental economics,
clean energy and climate change.
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