AIN Carbon Tax update (July 2009)

Bizav’s carbon conundrum
By: Paul Lowe
Aviation International News...July 2009

Under H.R.2454, the “American Clean Energy and Security Act of 2009,” the goal is to reduce CO2 emissions to 17 percent of 2005 levels by 2050, with intermediate reductions to 97 percent of 2005 levels by 2012, 80 percent by 2020 and 58 percent by 2030.

Bill de Decker is sounding the alarm for just how seriously the plans could affect business aviation. Does the environmental regulators’ goal for shrinking business aviation’s carbon footprint border on impossible? “From a practical point of view, achieving the target is almost impossible without also having a drastic reduction in the growth of the fleet, extensive use of biofuels and extensive purchases of CO2 offsets.” see AIN article

AIN Carbon Tax update (June 30, 2009)

Aviation Omitted from House Cap-and-Trade Bill
A last-minute revision to legislation passed by the U.S. House of Representatives on Friday removed a requirement to set new greenhouse gas (GHG) emission standards for aircraft, potentially saving the U.S. commercial and business aviation industry billions of dollars between now and 2050. H.R.2454 would have called for business aviation’s carbon dioxide (CO2) emissions to be cut by one third as early as 2012 and by 90 percent by 2050. However, a report issued earlier this month by the Government Accountability Office reported that aviation accounts for only 2 percent of total human-generated CO2 and, even with the aggressive application of new and more efficient technologies, it is “unlikely” that aviation “would greatly reduce emissions by 2050.” However, the bill could still have an impact on oil refiners and increase the cost and affect the availability of aviation fuels. ConocoPhillips last month warned that, under the bill, “U.S. refiners will be bearing the cost for roughly one third of the nation’s GHG emissions but receiving only 2 percent of the total allowances under the current proposal.” The Senate hasn’t yet released a draft of its companion bill.

CARBON TAX and U.S. JOB LOSSES - 4 million Job Loss

May 2009

The economic impacts of this cap-and-trade program in just the first two decades is extraordinary. The estimated aggregate losses to Gross Domestic Product (GDP), adjusted for inflation,is $4.8 trillion. By 2029 the job losses in the manufacturing sector will be nearly 3 million. This is over and above the nearly one million manufacturing job losses that most economists predict will occur even in the absence of global-warming legislation. by David Kreutzer, Ph.D.....Testimony before The Energy and Commerce Committee U.S House of Representatives

April 2009: Robert Shapiro, chair and cofounder of the U.S. Climate Task Force and former Undersecretary of Commerce for Economic Affairs, makes a compelling political case that “the costs and lessons of the financial crisis may effectively swamp the prospects for cap-and-trade. If cap-and-trade has become a dead policy walking, those who care deeply about climate change will find that a carbon tax system has become the last, reasonable policy standing.” For the rest of Shapiro’s trenchant esssay, Is Cap and Trade a Dead Policy Walking?, click here. For an in-depth critique of cap-and-trade that also articulates, quite brilliantly, the essentiality of pricing carbon emissions clearly and transparently, see “Economic Issues in Designing a Global Agreement on Global Warming,” Yale Professor William D. Nordhaus’s keynote address prepared for an international meeting, Climate Change: Global Risks, Challenges, and Decisions, in Copenhagen, in March 2009.