EU emissions trading scheme in aviation: policy analysis and suggestions

Abstract

Effectively addressing the impact of aviation on climate change may prove a major challenge for policymakers. Τhe European Union Emissions Trading Scheme (EU ETS) is one of the main instruments used to reach the statutory reduction of greenhouse gas emissions. This paper examines policy issues regarding the implementation of the EU ETS in aviation. A two-round Delphi study was undertaken based on a sample of 31 experts from Airlines and the International Air Transport Association; Air Navigation Service Providers; Civil Aviation Authorities; Government Institutions; and informed individuals (consultants and academics). The different allocation methods of allowances; the linking of EU ETS to similar schemes in other counties/continents; and the interconnection of the scheme with related environmental policies in Europe are found to significantly affect the efficiency of the EU ETS. Simpler monitoring, reporting and verification processes; streamlining and increased transparency of the auctions and penalties revenue policy; and achievement of balance in the allowance market are recommended to rectify caveats of the EU ETS from a policy perspective.