Memorandum from the British Air Transport
Association
This submission has been produced by the British
Air Transport Association—the trade association for UK-registered
airlines. BATA members cover the scheduled, charter and cargo
airline sectors and produce over 90% of UK airline output. Our
submission responds to the specific issues listed in the Committee's
press release of 1 April.
Can the full environmental costs of aviation
be identified? What are the main issues of principle and methodological
difficulties in attempting to do so? Can remote but potentially
catastrophic risks be properly reflected in such an approach?
The environmental impacts of aviation are of
two main types—Local and Global. There are significant areas
of uncertainty in the quantification of the impacts of both types
and whilst some impacts are managed through a voluntary approach
(eg fuel efficiency) others are highly regulated (eg Noise).
LOCAL IMPACTS
The impact of Noise has a direct effect
on people living close to airports and, despite a marked reduction
in the population affected around, for example, Heathrow over
the last 20 years, noise impact is a continuing cause of
concern. The impact is largely a nuisance rather than a source
of direct environmental damage and it has proved very difficult
to quantify or value the effect. The Government's current ANAS
study is the latest attempt to understand and quantify what
is a highly subjective issue. Most attempts to quantify a cost
have been based on estimated effect on property.
Aviation's noise impact is already well regulated
with detailed schemes in place at the main airports in the UK.
The costs of operating within these regulations and of relevant
noise mitigation schemes (eg soundproofing) are absorbed by the
industry and hence paid for by air travellers.
The impact of aviation on Local Air Quality
is a fairly new issue. Following the introduction of EU health
limits on pollution, which came into effect from 2005 and 2010,
much joint airline, airport and local authority work is under
way around the one airport where there is a risk that the NO2
limits will be exceeded.
It has become clear that the previous modelling
of air pollution has greatly exaggerated the contribution of aircraft.
However, it is likely that action will need to be taken to control
emissions from all contributing sources in and around the airport.
An action plan should be put in place once there is a better understanding
of the various sources, their contribution and potential from
improved technology.
GLOBAL IMPACT
The main environmental impact of aviation is
on Global Warming and the most recent assessment of this was undertaken
by the Intergovernmental Panel on Climate Change (IPCC) in 1999.
The IPCC reported that, with the exception of CO2 emissions, there
were a number of areas of scientific uncertainty that limited
their ability to define the impact of aviation on climate.
BATA supports the need for continuing scientific
research on the atmosphere at altitudes used by most civil aircraft
to improve our understanding of both the atmospheric chemistry
and aviation's impact on climate change.
Despite these large uncertainties, the impact
of non-CO2 emissions such as NOx, contrails and aerosols was estimated
by IPCC and added to the CO2 emissions to reach a total climate
impact of 2.7 times that of the CO2 emissions alone. This factor
of 2.7 continues to be used in any assessment of aviation's environmental
impact.
How comprehensive and accurate are the environmental
costs included in Aviation and the Environment: Using Economic
Instruments, and in the Department for Transport's consultation
The Future Development of Air Transport in the United Kingdom?
It is not clear. The potential inaccuracies
in assessing aviation's impact, including the 2.7 factor on global
warming referred to above, are bound to transfer to the cost calculations
in both Aviation and the Environment: Using Economic Instruments
and the previous paper Valuing the External Costs of Aviation
(DETR December 2000).
Both papers conclude that the major environmental
impact of aviation is that related to global warming with an estimated
cost an order of magnitude greater than Noise, Local Air Quality
or any other impact.
The assumed cost of carbon is another key factor
in any calculation. The figure of £70/tonne used in the Economic
Instruments paper is not justified and is clearly much higher
than assumptions in previous work and values experienced in the
UK emissions trading scheme.
This unjustified price assumption together with
the large scientific uncertainties surrounding aviation and climate
change inevitably result in a figure which has, as any product
of an hypothesis multiplied by an assumption, an inherently high
risk of inaccuracy.
Has the Government defined the correct environmental
policy objective for aviation—that, where appropriate, the
industry should pay for its environmental costs? How does this
relate to the Government's primary objective for airports—to
maximise the significant social and economic benefits, whilst
seeking to minimise the environmental impacts?
BATA airlines accept that they, like all industries,
should cover their environmental costs in a fair and equitable
manner.
Wherever possible we believe that this should
be achieved by reducing impacts through technology and operational
improvements, appropriate regulation (eg noise, local air quality),
mitigation and, in the case of new development, appropriate compensation.
Government policy should be focused on reducing
environmental impacts. A policy aimed at just raising tax revenue
would be environmentally ineffective (and possibly counter productive)
and would conflict with economic and social policies. It must
be stressed that air travel is now enjoyed by the vast majority
of the population (50% of the UK population has flown in the last
12 months) and air transport is a crucial facilitator for many
of the UK's key industries.
It is inaccurate to allocate the objective of
"maximising the significant and social and economic benefits,
whilst seeking to minimise the environmental impacts" purely
to airports. Users of air transport need airlines and the ground
and air infrastructure to make a journey happen. This should be
a policy objective for the whole of aviation.
Would the incorporation of environmental
costs be sufficient to achieve sustainability in the air transport
sector? What additional measures, if any, would need to be taken
if this were to have little impact on rates of growth? To what
extent is there a tension between the policy of incorporating
environmental costs (especially of carbon) and the Government's
long-term objective of a 60% reduction in CO2 by 2050?
BATA airlines believe that a sustainable growth
in air transport capacity is justified based on a fair balance
being struck between environmental impacts and economic and social
benefits.
The industry agrees that external costs should
be covered and we would like to note that Air Passenger Duty (APD)
raises almost £1 billion annually and covers the environmental
cost estimate put forward in the DETR paper Valuing the External
Costs of Aviation of December 2000. Aviation in the UK also
covers all other external costs such as infrastructure, security
and even the costs of its regulator.
The industry has a good record of improvement
in fuel efficiency and reduction of noise impacts and will continue
to seek further improvements. The UK airline fleet is one of the
youngest in the world and to maintain the environmental benefits
of fleet replacement it is important that the economic performance
of the industry is not undermined.
In particular, we see potential for fuel efficiency
through improved Air Traffic Control in Europe and for improvements
in fuel efficiency, noise and NOx through improved technology
in future aircraft.
On the key issue of global warming we support
the introduction of open, international emissions trading (based
on CO2 initially)—a much more effective tool than taxes
or charges—as a replacement for APD.
This question suggests a need for demand management
beyond the internalisation of environmental costs. This is something
we would reject in principle and also on behalf of our customers.
Demand management by price is regressive. It would have an immediate
effect on inbound tourism and an insidious, but no less important,
effect on general business and trade. Aviation should be treated
as any other public transport mode.
Given the international context, what practical
options for incorporating environmental costs are really available
to the Treasury and the Department for Transport, and how should
any revenues be used?
Aviation is very much an international activity
in the UK. About 90% of air travellers arriving or departing UK
airports are on an international journey.
The UK depends on air transport for business
and trade. Two-thirds of inbound tourists arrive by air and account
for three-quarters of inbound tourism spend. One-third of goods
(by value) are moved by air.
The UK should not implement measures that disadvantage
either the UK aviation industry or the UK as a whole. The nature
of demand for air transport is such that any unilateral attempt
to reduce, for example, "the UK's aviation emissions"
would result in the export of emissions, as well as the export
of jobs. The impact on global warming would be negligible, but
the impact on the UK economy would be severe. It is therefore
very important that the way forward on aviation and global warming
is international.
Whilst such a solution is being developed we
should be taking all possible measures to improve efficiency in
current operations and to encourage the development of even better
technology for future aircraft.
As the UK has a significant Aerospace Manufacturing
sector we would suggest that some of the existing £1 billion
per annum of APD revenue is used to support this research and
technology development.
April 2003
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