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A group of European aviation bodies has appealed to the European Union (EU) leadership to not expand the scope of the EU’s Emissions Trading Scheme (ETS) for fear of triggering trade reprisals from countries outside the bloc.
The plea comes from the Destination 2050 alliance representing key players in the European aviation industry, including airframe, engine and equipment manufacturers, airlines, airports, and air navigation service providers. The alliance aims to achieve net-zero CO2 emissions for all flights departing the EU, UK and EFTA by 2050.
In an open letter to European Commission President Ursula von der Leyen, EVP Stéphane Séjourné, and commissioners Wopke Hoekstra and Maroš Šefčovič, the alliance members ask for common sense during the pending review of the EU ETS for aviation.
The letter urges the commission not to expand the current geographical scope of the EU ETS.
The alliance members note that an earlier attempt by the EU to expand the scheme’s scope to non-EU airlines triggered strong opposition from those airlines and their respective governments, with threats of trade reprisals if it went ahead.
“Back in 2012, the proposed extension of the EU ETS to extra EU/EEA flights faced significant international opposition and retaliatory measures from third countries, jeopardizing billions of euros’ worth of European aircraft sales,” the Destination 2050 alliance wrote. “At the same time, the U.S. Congress prohibited U.S. airlines from participating in the scheme. Those reactions led the EU to adopt the ‘stop the clock’ mechanism.”
The alliance pointed out that derogation expires at the end of 2026 and would result in an automatic extension of the geographical scope.
“We respectfully urge the commission to ensure that it does not lapse while the revision of the EU ETS remains under negotiation,” the alliance wrote. “In the current geopolitical context, extending the EU ETS beyond intra-EEA flights will likely provoke an even stronger international backlash than in 2012”—an apparent acknowledgment of the strong “America First” sentiment in the U.S. Congress.
“European aeronautics and aviation are a cornerstone of the continent’s economic sovereignty and strategic autonomy. The regulatory framework must reflect that,” the group adds. “The appropriate solution is a strengthened CORSIA as the single global carbon pricing framework for international aviation.”
The letter also says that the commission must ensure that aviation-related revenues are reinvested in the sector’s decarbonization and that the EU ETS framework effectively supports the sector’s transition.
“With ReFuelEU Aviation mandating rising SAF blending obligations, it is essential that part of the revenues generated by European airlines through the EU ETS are channeled back into the sector, for example through making SAF offtakes economically viable across the aviation ecosystem and through reinvesting in the development of new aircraft and engine technologies,” the alliance states. “In parallel, SAF allowances must be increased and extended beyond 2030 to bridge the cost gap. The ETS Innovation Fund must also be reoriented to prioritize aviation’s decarbonization needs commensurate with the sector’s contribution to the system and the scale of investment required to achieve net-zero emissions.”
The Destination 2050 alliance concludes by reiterating its commitment to achieving net-zero by 2050, noting, “We ask for a policy framework that matches that ambition with competitiveness, investment certainty, and global coherence.”
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