Thursday, December 21, 2006

Busy in Brussels: Legislation gets green light

Two vitally important pieces of European legislation received the green light this week .

The first was the rubber stamping of the REACH (Registration, Evaluation and Authorisation of Chemicals) legislation. After seven years in the making, with strong lobbying by pharmaceutical companies, the European Council formally adopted the new regulation on the 18th December. REACH will enter into force on 1st June 2007. As ever with strongly contested legislation, the outcome is deemed a compromise, but nevertheless what has been achieved will have long-term ramifications for chemicals manufactured or exported into the EU. REACH puts the onus on business to show that the chemicals it uses are safe. Hazardous chemicals are to be replaced with safer ones unless specifically authorised, and the chemicals sector will be encouraged to research and develop more new products. For a nifty summary see:
BBC News

The second was the announcement in Brussels that airlines are to be included in the European Union's carbon trading scheme. Plans are to include just intra-EU flights in its carbon trading scheme in 2011, and all flights into and out of Europe from 2012. Carbon trading is a form of emissions trading that allows a country to meet its carbon dioxide emissions reduction commitments, in as low a cost as possible by utilising the free market. It is a means of privatising the public cost or societal cost of pollution by carbon dioxide. By inclusion in the European carbon trading scheme airlines would receive a certain stock of permits to emit greenhouse gases but have to buy any extra if they exceed that cap.

Many airlines are keen to be included in a carbon trading scheme which may have a lesser impact on their bottom line than taxes, and could even raise profits. But carriers are still bickering over the scope of the plans - whether these should cover all flights or just those inside Europe - possibly setting up years of legal disputes over jurisdictional issues.

Decision has yet to be determined over the controversial issue of whether or not to auction the permits or give them away free.

"I would include (aviation) in the emissions trading scheme and auction 100 percent (of permits), and direct those funds into research, development and deployment," said Michael Rea, Director of strategy at the Carbon Trust, which spearheads Britain's drive to a low-carbon economy.

"Whether you like it or not aviation is a consumer need. What's important is to incentivise aircraft manufacturers and operators to innovate."

[Photo credit: Adrian Hanft @ found photography]

No comments: