Europe’s Doomed Flight of Decarbonizing Fancy

Green taxes are soaring. To be precise, to 30,000 feet as the EU’s new carbon tax on airlines for all flights to or from Europe kicked in on January 1. While the levies involved will push profit margins to the limit for some, with ETS carbon permits trading at pathetically low levels and expected to stay that way through 2012, the pain in the first year for airlines may not be as much as the €1.1 billion initially projected. Even so, letting the plane take the carbon strain represents seriously poor long-term strategic planning for Europe given the looming global trade war it is about to ignite.
One can only wonder what the Brussels-based mandarins were thinking. The global war on CO2 is going nowhere. By the end of 2011 global emissions had hit an all-time high. China, India and others are fast-industrializing opening new coal-fired power stations more quickly than the EU can shut down the old ones. The Kyoto alliance is crumbling as Russia backs Canada’s pull-out. Renewables subsidies and investments are being devastated by shale extraction investments – ironically, with natural gas from shale impacting CO2 levels far more than the global carbon war has.
To cap it all, the EU carbon price is currently languishing between €6 and €9 per tonne; nowhere near the levels needed to secure industrial action and raise the revenues required to keep renewables on subsidized life support. As well as alienating the airlines and air travellers, the EU is mired in its Eurozone mess. It has chosen this moment to fire the first shot in a global trade war; as Dirty Harry would say: “Outstanding”.
10/01/12 Peter C. Glover/Energy Tribune

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Categories: Foreign Jan 2012, Indian Aviation- In General Jan 2012