Pressure builds against EU fees

Administration eyes formal complaint to protect U.S. airlines

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Lawmakers on Capitol Hill pressed the Obama administration Wednesday to back the cash-strapped American airline industry in a mounting battle over the European Union’s plan to charge international carriers extra fees for carbon emissions.

Rep. Bill Shuster, Pennsylvania Republican and a member of the House Transportation and Infrastructure Committee, said the U.S. government should pursue an Article 84 court challenge against the EU at the U.N. International Civil Aviation Organization (ICAO). The EU plan also has been criticized by China, India and other nations.

“Let’s start the process on Article 84, and then I think they’ll start to twitch,” Mr. Shuster said at a bipartisan meeting of committee lawmakers with administration officials. “It’s affecting our companies today. So I think the time is now to act.”

Administration officials told the gathering that they were still debating whether to file a formal case at the ICAO.

“We are looking at a whole range of options,” said Chris Urs, the State Department point man on aviation matters. “We have taken nothing off the table.”

The EU plan sets quotas and charges international carriers for their carbon emissions on flights to and from Europe, including portions of flights outside the region’s airspace. The EU rejected arguments by U.S. and international carriers that they should be exempt from the charges.

Carriers initially would receive 85 percent of their emissions certificates free of charge but would have to bid for the rest.

The Reuters news agency reported that Connie Hedegaard, the European commissioner for climate action, is in Washington this week to discuss the dispute. EU officials have said they would drop their quota plan only if a larger global agreement is in place.

Nancy Young, vice president of environmental affairs for the Air Transport Association of America, said congressional failure to act could result in devastating losses for the industry. She said the EU could impose significant fines, impound planes and even ban companies from European airspace if they fail to meet the bloc’s quotas.

“From an airline perspective, we would be directly affected,” said Ms. Young. “We think some of those measures in fact themselves would be violative of international law.”

Julie Oettinger, assistant administrator for policy, international affairs and environment at the Federal Aviation Administration, said the agency agrees with the EU goals to reduce pollution, but not with how the bloc is going about enforcing it.

She said the U.S. is already part of an ICAO effort to improve fuel efficiency and reduce emissions.

She added, “If there needs to be some sort of carbon offsets as part of that, build a little bit of gap, so be it, but we really think the right focus is on the plan that we have.”

Sean Cassidy, vice president of the Air Line Pilots Association and an Alaska Airlines pilot, told the committee that “being green is good for airlines” because it means lower fuel costs and spurs technological innovation.

The committee concluded by unanimously deciding to write a letter to President Obama and the U.S. ambassador to the EU to push an Article 84 measure to pressure the EU to step down.

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