H.R. 2594: European Union Emissions Trading Scheme Prohibition Act of 2011

H.R. 2594

European Union Emissions Trading Scheme Prohibition Act of 2011

Sponsor
Rep. John Mica

Date
October 24, 2011 (112th Congress, 1st Session)

Staff Contact
Communications

Floor Situation

On October 24, 2011 the House is scheduled to consider H.R. 2594 under a suspension of the rules, requiring a two-thirds majority vote.  The bill was introduced by Rep. John L. Mica (R-FL) on July 20, 2011, and referred to the House Transportation and Infrastructure Committee, which reported the bill by voice vote on September 8, 2011.

Bill Summary

H.R. 2594 would direct the Secretary of Transportation to prohibit operators of civil aircraft of the United States from participating in any emissions trading scheme (ETS) unilaterally established by the European Union.

The bill would establish congressional findings that:

  • The European Union has unilaterally imposed an emissions trading scheme […] on non-European Union aircraft flying to and from, as well as within, Europe; and
  • The European Union’s extraterritorial action is inconsistent with long-established international law and practice, including the Chicago Convention of 1944 and the Air Transport Agreement between the United States and the European Union and its member states, and directly infringes on the sovereignty of the United States; and
  • The European Union’s action undermines ongoing efforts at the International Civil Aviation Organization to develop a unified, worldwide approach to reducing aircraft greenhouse gas emissions and has generated unnecessary friction within the international civil aviation community as it endeavors to reduce such emissions.

H.R. 2594 would further direct the Secretary of Transportation – as well as the Administrator of the Federal Aviation Administration and other appropriate government officials – to “use their authority to conduct international negotiations and take other actions necessary to ensure that operators of civil aircraft of the United States are held harmless from any emissions trading scheme unilaterally established by the European Union.”

Background

The European Union’s ETS began in 2005 with the capping of emissions of carbon dioxide from more than 10,000 stationary sources within the EU.  Beginning in January 2012, civil aviation operators landing in or departing from the EU will be included in the ETS.  Under the scheme, any flights into or out of an EU airport, regardless of how long that flight is in EU airspace, would be subject to the program’s emissions cap and trade requirements. U.S. airlines would be required to pay an emissions tax to the EU Member State to which they most frequently fly.

According to the House Transportation and Infrastructure Committee, “[t]he U.S. aviation sector has a strong record of fuel efficiency and emissions improvements and continues to work with the government to advance technological, operational, infrastructure and alternative fuel opportunities for further improvements.”  The United States Government has formally objected to the ETS – and China, Australia, Canada, and numerous other countries have expressed objections to the application of the ETS to their air carriers.  U.S. airlines have also challenged the policy before the European Court of Justice as a violation of international law.

Problematically, the ETS contains no requirement that revenue collected under the scheme go to emissions related research and development.  According to the House Transportation and Infrastructure Committee, the ETS “lacks any transparency or clarity, providing no guidance as to how the EU will apply the ETS to international air carriers.”

H.R. 2594 would direct the Secretary of Transportation to prohibit U.S. aircraft operators from participating in the ETS and instruct U.S. officials to negotiate or take any action necessary to ensure U.S. aviation operators are not penalized by any unilaterally imposed EU emissions trading scheme.

Cost

According to the Congressional Budget Office (CBO), enacting H.R. 2594 “would have no significant impact on the federal budget.”  It further concludes that “the bill would not alter the scope of diplomatic efforts currently underway or federal agencies’ costs to participate in those efforts, which are subject to appropriation.”  The bill would not affect direct spending or revenues, so pay-as-you-go procedures do not apply.