Feature of the Month
ETS Aviation
After a very long round of interinstitutional negotiations between the European Parliament, Commission, and the Council which ended in the early morning of the 7th of December, policymakers reached a provisional agreement on the ETS Aviation, restricting EU carbon tax to flights within Europe.
What is the exact scope of the aviation ETS and how does it link to CORSIA?
EU policymakers, despite strong lobbying from green groups, have decided to restrict the ETS Aviation to intra-EU flights for the time being. Flights travelling to or from outside of the European Economic Area will be covered by the international measure, CORSIA.
The Commission will assess in 2026 whether the CORSIA system is an effective tool to cut global flight emissions. If it is found ineffective, the ETS will then apply to all flights from 2027.
What is happening to free allowances for airlines?
Free allowances to airlines will phase out by 2026. Moreover, to boost the decarbonization of the sector, negotiators approved a “SAF allowances” pricing scheme, which aims to bridge the price gap between conventional jet fuel and sustainable aviation fuels (SAFs). Under this scheme, airlines will be able to deduct 100% of the cost of e-fuels and 70% of advanced biofuels.
The deal also introduced a non-CO2 reporting provision, where airlines will have to disclose their non-CO2 effects, starting in 2025. The non-CO2 effects will include soot and harmful gases such as sulphur and nitrogen oxide, as well as water vapour from jet engines.
Key Points
1. Transport & Sustainability - Developments on the Legislations Relevant to Achieving the EU's Climate Targets
RefuelEU
The Czech Presidency and many Members of the European Parliament had hoped to reach a political agreement before the end of 2022 on RefuelEU, the EU's initiative to introduce a mandate for sustainable aviation fuels. Negotiations failed due to ongoing controversies over green fuel targets. Policymakers will reconvene in the new year to resume negotiations under the Swedish Presidency.
Corporate Sustainability Reporting Directive
The CSRD was formally adopted on the 28th of November by the Council.
The responsibility for creating the exact requirements rests with the European Financial Reporting Advisory Group ("EFRAG"), which has been tasked with developing the EU Sustainability Reporting Standards ("ESRS"). EFRAG published in late November its first draft of ESRS, which will now need to be approved by the European Commission by June 2023. View the first draft of requirements here.
2. Other updates
5G and calls allowed in flights
The Commission has updated the implementing decision on spectrum for mobile communications on-board aircrafts, designating certain frequencies for in-flight 5G technology, allowing the airlines to be able to provide the latest 5G technology on their planes. View more here.
French ban on short-haul flights approved by the Commission
French lawmakers voted in 2021 to ban domestic flights on short-haul routes when there is an alternative rail connection of two and a half hours or less. The European Commission has approved France's plan - but it will only affect three routes: Travel between Paris and Bordeaux, Nantes, and Lyon. View more here.
Germany making rail cheaper
Following the successful 9-euro summer ticket for all regional trains throughout Germany, the new heavily discounted nationwide public transport ticket priced at 49 euros per month will be available from April despite the push for an earlier start. More information can be found here.
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