EU to include flights to Middle East, North Africa and all private jets in ETS overhaul

On Friday, the European Commission announced that commercial flights connecting Europe with the Middle East and North Africa, as well as all departing and arriving business jets, must begin paying the EU's carbon price for the greenhouse gases they emit.

Compromise on Long-Haul Flights

Rather than extending the Emissions Trading System (ETS) to all long-haul flights—which triggered a diplomatic dispute with Washington and Beijing when attempted in 2012—Brussels has proposed covering only flights departing from Europe and landing within a 5,000-kilometer radius of Frankfurt airport.

This means:

• All flights to major neighboring hubs like Istanbul and Dubai will be subject to Europe's carbon tax
• Routes to American and Chinese airports will be exempt
• All incoming flights will be exempt

The application of EU carbon pricing to flights landing at neighboring airports represents a first attempt to level the playing field between European airlines and hubs and their direct competitors just outside Europe's borders, who are not subject to Europe's stringent climate laws.

The proposal appears to be a compromise to avoid a full-scale clash with the UN's Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), developed by the International Civil Aviation Organization (ICAO) and set to apply to all international flights starting next year.

Another Six Years

A 'stop-the-clock' measure adopted after the diplomatic row 14 years ago was set to expire at the end of 2026, automatically bringing all flights into and out of Europe under the ETS, where a permit to emit a tonne of CO2 currently costs around €80.

That is roughly what an airline would have to pay per economy class seat for a typical round-trip flight from Paris to Los Angeles, while business class is assumed to have a significantly higher carbon footprint due to the larger space occupied by seats.

The Commission stated that although it still does not consider CORSIA a sufficiently robust climate instrument, it is giving the global aviation industry an additional six years to demonstrate its effectiveness in curbing long-haul flight emissions. The situation will be reassessed in 2032.

"If CORSIA is solid, then we return to intra-European scope," an EU official briefed reporters on Friday. If not, Brussels will extend the ETS to all departing flights, the official added.

Any costs arising from compliance with CORSIA will be deducted from the CO2 price paid by operators of international flights that fall within the scope of the ETS.

With the mandatory use of sustainable aviation fuels set to increase over the next few years, European operators feared that the inflationary impact on refueling costs would push airlines to use airports outside the EU to connect long-haul routes.

Industry Reaction

Airlines for Europe, a lobby group representing most of the EU's major carriers, quickly criticized the proposals.

"The Commission has opted to extend a regional system to a global problem, while there is still no guarantee that the money passengers pay for ETS is reinvested into decarbonizing aviation," the group said in a statement.

Tax the Rich

Although all domestic commercial flights pay the full EU carbon price, most emissions from private jets are not priced due to various exemptions.

Climate Commissioner Hoekstra said it was time for this to change.

"All private jets, either departing or landing, will be covered," he said.

He questioned why "a family flying from Brussels to, for example, Benidorm … should pay ETS, while someone flying in a private jet can go back and forth and not pay a single time."

"That should be stopped," Hoekstra said.