Climate bill passes US House, could cost airlines billions
June 30, 2009: The US House of Representatives on Friday passed by a vote of 219-212 the Waxman-Markey American Clean Energy and Security Act, which now moves to the Senate for consideration and could, if passed, prove to be an onerous financial burden on airlines, according to the US Air Transport Assn.
The 1,200-page climate change bill places limits on US carbon dioxide emissions and creates a cap-and-trade regime for most industries intended to reduce greenhouse gas emissions 17% from 2005 levels by 2020 if passed by the Senate and signed into law by President Barack Obama (ATWOnline, May 28). US airlines will feel the impact in the form of a surcharge placed on fuel purchases to cover the cost of carbon permits that fuel producers will have to acquire. ATA has estimated the added cost at $5 billion in 2012, rising to $10 billion by 2020.
"This cap-and-trade bill creates an onerous fuel tax on the airline industry," ATA President and CEO James May said. "Fuel costs will skyrocket, hindering the ability of US airlines to continue to improve their environmental performance through fleet modernization and technological advances, weakening their ability to compete in the global markets."
However, ATA also noted that the bill contains language urging the US to work through ICAO to develop "a global framework for the regulation" of GHGs from civil aircraft and to "work with foreign governments towards a global agreement that reconciles foreign carbon emissions reduction programs to minimize duplicative requirements and avoids unnecessary complication for the aviation industry."
According to May, "These conflicting views indicate clearly that, at least as to aviation, far more work needs to be done to construct the right approach to dealing with climate change. What we have now just does not make sense."