House Passes European Union Emissions Trading Scheme Prohibition Act

By a consent vote last Thursday, October 20, 2011 and after less than an hour of debate, the United States House of Representatives approved H.R. 2594, the “European Union Emissions Trading Scheme Prohibition Act.” If this bill is passed by the Senate and signed by President Obama, it would force the Department of Transportation to bar U.S. airline operators from complying with the European Union’s Emissions Trading Scheme. As previously posted, the carbon trading scheme has drawn criticism from many countries that question its compliance with international laws and agreements.       

For more details, please see the articles at LAW360 or Bloomberg Business Week. The text of H.R 2594 can be found at the Library of Congress. As this issue progresses, please check back to this blog for future posts. 

EPA Sets Its Regulatory Cross Hairs on Leaded Aviation Fuel

Avgas (aviation gasoline), the last type of leaded fuel available on the U.S. market, has recently drawn the scrutiny of EPA. Although it makes up only a tenth of 1 percent of the liquid fuel sold in the U.S., it is the life blood of smaller piston-engine aircrafts. In the 1970’s and 1980’s, EPA used its authority under the Clean Air Act to push for the removal of lead from automobile gasoline and today this move is considered one of the greatest environmental achievements of all time. However, Avgas and racing fuel were spared EPA regulation mainly because of their relative small impact and limited use. Racing fuel switched to a customized blend of high-octane gasoline in 2008 and it appears that EPA has now taken notice of Avgas.

Later this year, air quality monitors will be installed at 15 airports to gather data on lead pollution and to aid EPA in making a determination on whether Avgas is exposing people to dangerous amounts of lead. EPA’s move comes as a result of a lawsuit from the environmental group Friends of the Earth. Scientific studies have shown that aircraft emissions contributed to lead in children’s blood, particularly those living close to airports.

The Federal Aviation Administration has assembled the Unleaded Avgas Transition Aviation Rulemaking Committee to plan for the potential transition away from Avgas, but the same problem that has kept Avgas around in the first place has yet to be solved. The problem being that no suitable replacement exists. Lead helps protect engines, a unique quality not easily replicated. Engines that burn Avgas can’t handle the ethanol added to regular gasoline and premium gasoline is less powerful than the 100 octane Avgas. The industry has been testing alternatives for quite some time, but none have worked. However, the industry has not been under any pressure thus far to achieve results.

Any Avgas ban would most directly affect aircraft operated in Alaska, which uses roughly one-third of the Avgas consumed in the U.S., and in other remote areas that use piston-engine planes to deliver food, medicine, and other supplies to remote towns. An Avgas ban would essentially regulate these aircraft out of existence. To address this, the National Business Aviation Association and others have formed acoalition of stakeholders that is seeking an approach that focuses on concerns about safety, cost, availability and ease of Avgas production.

If you consider that Avgas is only a small piece of the overall emissions pie, it is clear from this move to begin a monitoring program as well as other recent moves by EPA that air pollution is a top priority. It is likely we will see more emissions regulation in the near future. As this issue progresses, please check back to this blog for future posts. 

Inclusion of Non-European Union Aviation Sector in Emissions Trading System Does Not Violate International Law

As noted in earlier posts, beginning January 1, 2012, the European Union ("EU") plans to include the aviation sector as the second largest industry in its carbon Emissions Trading System ("ETS"). The plan requires all airlines, including airlines operated out of non-EU countries, to use emissions allowances for flights to or from European airports. The international community has spoken out against this measure, with more than 20 countries, including the United States, China, India, Japan, and Russia, signing a declaration vowing to challenge the EU's plan. The Air Transport Association of America, American Airlines, Continental Airlines, and United Airlines took further steps, filing an action in the High Court of Justice of England and Wales arguing that inclusion in the ETS would place them under U.K. authority. Air Transport Ass'n of America v. Secretary of State for Energy and Climate Change, EU Court of Justice, No. C-366/10. The High Court referred the case to the EU Court of Justice for an interpretation of EU law.

On Thursday, October 6, 2011, Advocate General Juliane Kokott wrote an advisory opinion on behalf of the EU Court of Justice finding that the EU's inclusion of the entire airline sector does not infringe on the sovereignty of other states or international agreements, including the U.S.-EU Open Skies Agreement, the Kyoto Protocol, or the Chicago Convention on International Aviation.  Although the opinion is non-binding, the advocate general's opinion normally predicts the final judgment of the case, which is expected in early 2012. For more details, please see the BNA Daily Reporter article or LAW360 article. As this issue progresses, please check back to this blog for future posts.