Examination of Witnesses (Questions 180
- 199)
WEDNESDAY 11 FEBRUARY 2004
MR JEFFREY
GAZZARD
Q180 Mr Challen: You mentioned the
fact that we are taking over the EU presidency in 2005. It sounds
to me like an announcement on this scheme will not be one of the
crowning achievements of that presidency at the current pace but
you mentioned the Dutch were preceding us. How do we relate to
other countries in the EU in terms of their commitment to this
scheme? Are they as committed as we are? I am just thinking of
Holland, a very small country with a very large airport and very
large international traffic. Do they have the same concerns as
we have? Are they as committed, and indeed other European Union
countries, in your view?
Mr Gazzard: One of the things
I said in our memorandum was that I did feel in the UK arena that
most policy-makers in DEFRA, the DTI, the Treasury and what have
you knew the scale of the issues and that is true for our European
colleagues as well, whether they are regulators in the CAA or
environment ministries or environment protection agencies. Everybody
knows it is a major problem. There is no argument about that any
more. The discussion, as the Committee is quite rightly putting
me on the spot about, is how do you develop policy initiatives
and analysis to get some results here. The strongest government
on this would be Germany, in my view. The Dutch, for the reasons
you pointed out—they have a very big airport—are note
very pro this. You would have thought with the low-lying nature
of their country they would equally be interested in climate change
implications. We have spoken to them and I have asked that question
directly of Tineke Netelenbos, their transport minister. It is
this question of people being sometimes unable to get the balance
between their economic imperative and their environmental obligations.
I am sorry to sound so woolly on this but the situation is woolly.
Q181 Mr Challen: Are some of these
other countries pushing other solutions then? Are they looking
at other solutions or, given the timescale, interim proposals?
Mr Gazzard: Well, everybody is
quite keen to. I think most people have realised that the ICAO
process, which is the mandated process for developing an emissions
trading scheme is never going to materialise. The only useful
thing about the work that ICAO do is they run a lot of scenarios,
which are quite useful, but the power of the USA and its allies
there, although it is supposed to be a consensual organisation,
is such that there will never be, in my opinion, any workable
emissions trading scheme developed by ICAO even though that is
their mandate. That is why I think in the Environment Directorate
at the Commission there is a desire to work towards including
air transport in an emissions trading scheme but there is also
just as firm a desire, I think, to look at enroute charges as
a medium term mechanism as well. For instance, we have had discussions
with Euro Control, which is the alliance of air navigation service
providers across Europe, nearly 50 countries now, because we were
concerned to get our act together and say is this the best mechanism
for charging an en route emissions levy. Would it have any accountancy,
treasury and cost implications for them? Because they would be
literally analysing it and charging their airline customers. So
there is some work we have done on the mechanisms of how you would
introduce this in accountancy terms, what the organisation would
be and we have got them thinking about any financial implications
as a result because what we have been trying to do is to move
this forward on two fronts—the practicalities of an emissions
charging scheme, which I think we can work out, and then the policy
implications of it. To be quite honest, I am more advanced on
the practicalities of it than we are on the policy implications.
Q182 Mr Challen: I understand the
ICAO conference is taking place as we speak in Montreal and that
your director is over there.
Mr Gazzard: Yes.
Q183 Mr Challen: Could I just ask
about the focus of that event and what people going to it might
hope to get out of it.
Mr Gazzard: Well, they have already
got something out of it, which is the new standard for NOx. This
is the standard that aero engine performance has to meet by 2008.
If I could just find this note first of all, I will read it to
you.
Q184 Mr Challen: Could I just ask
whether that would reflect George Bush's contention that we just
have technological solutions to these problems and regulation
does not really come into it at all?
Mr Gazzard: No, I think it is
slightly better than that, to be fair. I hate to say that. What
they were looking at was a series of NOx stringency options. These
are for the performance of aero engines and these are better than
the current standard. So they were looking at a range of improvements.
All of these are percentages better: minus 5, minus 10, minus
15, minus 20, minus 25 and minus 30. So that is an improvement
in NOx performance over the existing stringency and they did a
number of scenarios. We went along and said we want the best,
minus 30, as did ACI, the airports body, because they are the
ones who have this problem of local air quality in NOx terms.
The UK Government said minus 20%, the US manufacturers, IATA,
said minus 10% and Canada said they did not see the need to do
anything. So although this was not modelled, we somehow came up
with minus 12%. It had not been modelled. It would be slightly
churlish of me to say they guessed at it, but they came up with
12%. What this means is that with a range of scenarios from 5-30%,
if we had gone for the best on the table that still predicted
an increase in aircraft NOx emissions worldwide from 2002 to 2020
of about 150%. That is with the best stringency. A 12% stringency
will lead to an increase of about 148-151% over those years. Once
again it is this whole question of growth overtaking these technological
improvements, which are welcome and once again it is a bit of
a cliché but they only make things not quite as bad as
they otherwise would be. What drives this is the cost implications
of this. Broadly those scenarios are best described as you can
have not a very good standard cheaply now or you can wait for
a better standard which is more expensive later. That is the difference
between those scenarios in essence and, unsurprisingly, what they
voted for was not very much now and cheaply, thank you very much.
Q185 Mr Challen: I do not know if
you would agree with my rather controversial characterisation
of the airline industry as perhaps being a little similar to the
tobacco industry, which always did put out a very positive message
until they were taken to the courts and people got very litigious.
Is the airline industry really aware of what the real figures
are but then in public spews out all sorts of other stories?
Mr Gazzard: I do not think they
are quite as bad as the tobacco industry. I think that would be
a slight overstatement, although I have my moments when I agree
with you completely. I do think they understand the problem and
I think they are relatively up front about the scale of it but
what they believe is that their commercial imperative is so important
that the best they can do, this kind of standard, is acceptable.
Q186 Mr Challen: Just finally then,
at the ICAO and other organisations at the international level
how would you characterise the Government's approach and specifically
on ICAO how is it represented in the sub-group on environmental
issues?
Mr Gazzard: This meeting we have
had a UK chair, who is the head of the Aviation Environmental
Division at DfT, a chap called Graham Pendlebury, who is fine
and I do not know how he keeps his concentration up because these
meetings are very tedious and stultifying. AED over the last two
and a half years has expanded so they have air quality specialists—not
specialists but administrative specialists like Roger Gardiner,
who has also gone and is the head of the UK delegation. We have
tried to make sure that DEFRA has been more involved in these
issues and DEFRA now send a representative to ICAO whereas three
or four years ago they did not do that. So I would say that the
DfT understand the issues. Their representation in a technical
sense at ICAO is fine. The diplomacy of negotiating standards
is, I think, the question you are really asking and how do you
get a better performance from our Government in ICAO. I do not
think you can because it is so dominated by airline and US interests.
The analogy I would use, to pick up what you said about tobacco,
is that it is as if the World Health Organisation was run for
the benefit of drug companies. I do not think it is.
Q187 Mr Challen: Just a little supplementary.
We had the issue—I know it is not on emissions but DVT was
a very controversial thing. Did the airlines sort of hold back
on information on that? We are talking about people's health in
many ways on this Committee.
Mr Gazzard: Well, you will know
that it went to a High Court judgment and the High Court said
that they did not actually think there was a responsibility there
and I think within a couple of days a major UK airline had taken
DVT socks off their travel shop shelves in Victoria. So I think
your analogy in a wider sense is well made. If I could, as the
risk of sounding a supreme self-publicist, just refer the Committee
again to our previous submission, what we try and do is to look
for new areas of research and new areas of interest that will
inform the debate. I know that sounds incredibly trite but we
have put a submission in that had some research we had found on
reinsurance companies and the UNEP programme, which is looking
at financial instruments and financial institutions, and they
mention that fossil fuel based industries could be facing the
question that you posed of future liability for health and the
environmental and physical impacts of the cost of climate change
caused by fossil fuel based users in exactly the same way as tobacco
is currently worried about being sued for the health impacts of
its products. That is the analogy they made, not me, so there
are people who think similarly to the comment that you made.
Q188 Mr Thomas: I would just like
to follow up on the NOx issue, if I may, with two things. First
of all, could you clarify the percentage increase overall that
you expect from NOx under the two scenarios you outlined. You
outlined the 30% scenario, which is the best.
Mr Gazzard: Yes. It is not what
we expect, it is what ICAO tells us will happen.
Q189 Mr Thomas: So they have done
the modelling?
Mr Gazzard: Yes, they have done
the modelling.
Q190 Mr Thomas: Could you just do
that again because I certainly did not quite understand.
Mr Gazzard: Sure. They have a
current standard. For the sake of this argument it does not matter
what it is. They discussed with airlines and everybody what technology
could reasonably deliver and they came up with a range of scenarios,
5% better than today at 5% gaps through to 30% and then they modelled
the cost implications of those, they looked at each individual
on aircraft performance, pages and pages of the most interminable
stultifying spreadsheets on this but very important. Then they
attached cost to those things and the most expensive is the best,
30%, and the least expensive of all just 5%. They went all through
this last week and on Wednesday they decided they would go for
minus 12%. Now, minus 12% stringency will limit the increase of
NOx. From 2002 to 2020 NOx will increase by 148-151%. If they
had gone for a 30% it would have been 140% increase, so it would
have been anywhere between 8 and 11% better.
Q191 Mr Thomas: Why is the gap there
so small? To a layman like me a difference between 12% and 30%
is huge; a difference between 140% and 148% is relatively minor.
Mr Gazzard: That harks back to
what I was saying earlier, that technological improvements are
(a) slowing down because you are squeezing the bottom of the barrel
and (b) growth overtakes them anyway. That is the scale of the
problem.
Q192 Mr Thomas: Are you able to transpose
those two scenarios, particularly the 12%, which is the one that
is going to happen anyway, into the situation then under the EU
regulation 2010 because if you are going ahead with the third
one, at Heathrow for example, then we have been told that would
affect something like 10,000 people with excess NOx emissions
under what would be the new EU regulations? Does this decision
last week mean that de facto has been overcome?
Mr Gazzard: No, quite the reverse,
it makes it harder, in our view. If we can go back to ICAO, because
I have not seen this work and neither has Tim Johnson, our director,
who as you know is in ICAO at the moment. We split these advocacy
roles between us. When they did a similar exercise for noise that
was based on a per airport scenario for what the various categories
of noise improvement would bring about. So it must be possible
to apportion this to an individual airport basis. As far as I
know they have not done that, but I am pleased to tell you ICAO
in Montreal has Wi-Fi and I can e-mail Tim this afternoon and
get an answer almost straight away on whether they have done it
and whether they would be prepared to do it. But it is perfectly
possible to answer your question in a slightly roundabout fashion,
now we know the standard to have a look at what its impact would
be on an airport by airport basis.
Q193 Mr Thomas: At your convenience,
is it possible to have further information to the Committee on
the implications of that, whether it is possible now or at least
some information?
Mr Gazzard: I will find out how
soon it can be done and let you know and if it is available, fine.[5]
Q194 Mr Thomas: I think that would
be useful.
Mr Gazzard: But off the top of
our head, there is no question that the better the improvement
the more benefits there are potentially, but you will be aware
that the Government published 27 background papers today, which
even I have not read yet, but they are in a bundle about that
high because the Minister thumped them on the table during the
debate which has just finished about that high and in there is
a specific Heathrow air quality assessment which has included
burying the M4 spur in a tunnel and moving the southern runway
even further south to try and avoid this problem plus a range
of issues to do with public transport and restricting road access
and the emissions from road traffic that BAA put forward. At the
end of that report NOx is still substantially exceeded so this
does not make it any easier.
Q195 Mr Thomas: Finally, to be absolutely
clear, that report and previous Government and BAA reports would
have been working on a model expecting what technological reduction
in NOx?
Mr Gazzard: They will have included
an estimate of what this may have been but I do not know what
that was without looking into it.
Q196 Mr Thomas: But it was not necessarily
12%?
Mr Gazzard: No.
Q197 Mr Thomas: In your estimation,
would it have been higher or lower?
Mr Gazzard: I cannot say without
looking at the document that has just been published and I have
not had that opportunity, but I can do that more or less straight
away.
Mr Thomas: Thank you.
Q198 Chairman: We are meeting on
a day when everyone is aware of those documents[6]
but nobody has had time to read them, which is a slight disadvantage.
Mr Gazzard: Well, it is a problem
because they were, to be critical of the Government as I was nice
to them earlier, promised to be published contemporaneously with
the White Paper. Who knows the reasons why they have been delayed.
Q199 Chairman: However, they will
be read with great interest, not least by this Committee.
Mr Gazzard: Well, probably by
me, I am afraid.
5 Please see supplementary memorandum. Back
6
Supporting documents for the "Future of Air Transport"
White Paper. 27 documents. List announced in Hansard Report,
10.2.04, 68WS. Back
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