Ticket prices for flights between Taiwan and Europe are expected to rise after the global aviation industry is included in the European Commission Emissions Trading Scheme (EU ETS) in January 2012, market sources said Saturday.
China Airlines (CAL) and EVA Airways, two of Taiwan’s leading international carriers, said a preliminary estimate showed that a one-way ticket between Taiwan and a European destination will rise by more than NT$100 (US$3.33) as the airlines will be charged for carbon dioxide emissions under the EU ETS.
However, the exact price hikes cannot be decided at the moment since the details of the carbon trading system, as it applies to the aviation sector, remain unclear, the carriers said.
According to the EU ETS, airline companies that are deemed as polluters will be asked to pay for their carbon dioxide emissions by buying permits from their counterparts for each ton of carbon emitted over a certain level.
The aviation industry accounts for about three percent of the EU’s greenhouse gas emissions and its pace of emission growth is faster than that of many other industries.
The EU ETS was launched in 2005, covering only a few industries such as steel, oil refining, power generation, construction materials, glass and pulp businesses.
The aviation sector is in the second phase of the carbon trading system and will be asked to monitor and report its carbon dioxide emissions to the EU from 2012 and to start paying in 2013.
Taiwan’s Civil Aeronautics Administration (CAA) said based on the two carriers’ current operations, it expects China Airlines to pay about NT$210 million and EVA Air NT$150 million in the carbon trade system in 2012.
In a research report, the CAA said passengers on China Airlines flights to Europe will each have to pay an additional NT$140 per trip, while on EVA Air the surcharge will be NT$173. However, the two carriers will adjust their routes in an attempt to reduce the emissions charge, it added.
Nonetheless, the CAA said, the carbon trade is likely to have limited impact on airfares, compared with the hikes seen during peak travel seasons.