A message to the European Commission urging it to avoid unilateral interventions that could undermine the competitiveness of the European aviation industry, in light of the upcoming revision of the EU ETS, is sent by the DESTINATION 2050 alliance, which represents the entire European aviation ecosystem.
The EU ETS is the European Union’s emissions trading system, through which airlines pay for the carbon dioxide emissions they produce.
The requests
In a letter to Commission President Ursula von der Leyen, Executive Vice-President Stéphane Sèzourne, and Commissioners Wopke Hoekstra and Maroš Šefčovič, European aviation stakeholders are calling for a regulatory framework that will enable the sector to achieve the goal of net-zero emissions by 2050, without, however, weakening the position of European airlines, airports, and manufacturers in the face of international competition.
At the core of the intervention is the industry’s opposition to any unilateral expansion of the geographical scope of the ETS (Emissions Trading System) to air transport beyond the system’s current geographical coverage.
Aviation representatives warn that any extension of the system beyond flights within the European Economic Area would create serious distortions of competition, favoring airlines and airports in third countries. At the same time, they believe it could trigger trade retaliation from other major markets and place a disproportionate burden on the European aviation sector without delivering any substantial environmental benefit.
In their letter, aviation stakeholders note that the previous attempt to extend the ETS to international flights in 2012 had provoked strong reactions from major economies, ultimately leading the EU to temporarily suspend the measure’s implementation through the “stop the clock” mechanism. Given that the relevant derogation expires at the end of 2026, they are asking the Commission to prevent any expansion of the system beyond its current coverage while the ETS review is underway.
Support for CORSIA
At the same time, European aviation stakeholders argue that the appropriate solution for reducing emissions in international aviation is to strengthen CORSIA, the global emissions offset and reduction mechanism of the International Civil Aviation Organization (ICAO).
As noted in the letter, Europe must promote a harmonized global approach to carbon pricing rather than adopting unilateral measures that could lead to trade conflicts and a loss of competitiveness.
These stakeholders also cite the conclusions of the Draghi report on European competitiveness, according to which aerospace and aviation are strategic pillars of the European Union’s economic sovereignty and industrial autonomy.
Particular emphasis is also placed on the issue of utilizing revenues generated by the ETS.
DESTINATION 2050 calls on the Commission to ensure that a significant portion of the revenues paid by airlines through the system is returned to the sector itself to finance the green transition.
Indeed, as noted in the relevant letter, the implementation of the ReFuelEU Aviation Regulation gradually increases the obligations to use Sustainable Aviation Fuels (SAF), which continue to have significantly higher costs compared to conventional aviation fuels.
“With the ReFuelEU Aviation Regulation imposing progressively increasing obligations to blend Sustainable Aviation Fuels (SAF), it is essential that a portion of the revenues paid by European airlines through the EU ETS be returned to the industry.
This can be achieved by supporting the economic viability of SAF supply contracts across the entire aviation value chain, as well as through investments in the development of new aircraft and engine technologies,” it is notably pointed out, with the organizations calling for “the increase and extension of relevant incentives for sustainable aviation fuels beyond 2030.”
Elsewhere in their letter, industry organizations call for the adjustment of the ETS Innovation Fund so that more funds are directed toward the development of new low-carbon aircraft, engine, and fuel technologies.
“We are calling for a policy and regulatory framework that balances this ambition with competitiveness, investment certainty, and international coherence. For this reason, we call on the European Commission to use the EU ETS review to establish a framework that will enable the sector to reduce its emissions, while safeguarding Europe’s industrial strength and its leading role in aviation and aerospace,” the letter states.
The letter from DESTINATION 2050 comes ahead of the planned review of the EU Emissions Trading System for aviation (EU ETS), which is expected to set the regulatory framework for the sector for the next decade.