Wednesday, November 02, 2011

America vs Europe trade war over carbon looming

The European Union is about to take two small steps on the long journey of combating climate change: A small "tax" on air travel and another small tax on fossil fuels based on exactly how polluting the specific type of fossil fuel is. Both could ultimately end up in WTO courts; the former brought there by the US, the latter by tar sands would-be super-power Canada.

The European Union Emissions Trading Scheme Prohibition Act of 2011

The Republican majority US House of Representatives voted to bar US airlines from paying the tax on carbon emissions ("European Union Emissions Trading Scheme Prohibition Act of 2011"). The airline tax is part of the EU Emissions Trading System (ETS) from 2008; it hands out 85% of the industry's emissions to them for free, lets them buy the remaining 15% on a free (dirt cheap) market. The industry estimate the tax would cost US airlines about $3.1 billion between 2012 and 2020.

"This bill could ignite a trade war that would put tens of thousands of U.S. jobs in jeopardy. [...] By barring U.S.- based airlines from complying with applicable law for flights traveling to EU airports, this bill would compel those airlines either to drop their EU routes or become scofflaws."
- Annie Petsonk, Environmental Defense Fund

Pause for a second to consider the opposite situation: The EU or other countries prohibiting their corporations to comply with a US environmental law. Not to mention the facts that the Republican's arguments - that the EU law is a "competitive disadvantage" and in "violation of international law" are both simply wrong. Dear Obama, please archive this law in your paper recycling bin.


Sources: Bloomberg / U.S. Vote on EU Aviation Plan May Start Trade War, Environment Group Says, Think Progress / House Could Start Trade War With Europe Over Airline Greenhouse Pollution, Green Economy / Republican-Majority House Votes Trade War against Europe, Center for American Progress / House Airline Bill Risks Diplomatic Fallout and Disaster to U.S. Industry.

The Fuel Quality Directive

A tax based on the relative environmental harm done by different kinds of fuel doesn't sound that bad an idea does it? Well, Canada, currently projecting the billions it plans to make from transforming huge swaths of forest into polluted gravel deserts, consider it a European political attack on them. Elsewhere this would file under "conspiracy theory".

"We have the knowledge and the fact that the oil sands are more CO2-polluting than other kinds of fuel [...] And therefore we say it should have a specific value. It's nothing targeted against this particular fuel. We are doing that with all our different biofuels. It's the same methodology that we are applying for different things in the same directive [...] And now we are discussing this also with our member states, with the Commission, which has proposed this."
- Climate Commissioner Connie Hedegaard

"Canada's plans for tar sands will put the world on track for 6 degrees of warming, way past the globally accepted limit of 2 degrees [...] Six degrees would be game over."
- Franziska Achterberg, Greenpeace

The Fuel Quality Directive ranks...
  • coal-to-liquid: 172 grams of carbon per megajoule
  • oil shale: 131.3 grams
  • oil sands crude: 107 grams
  • conventional oil: 87.5 grams

Greenpeace is blaming Britain (Canada ally) and Estonia (having oil-shale resources) of delaying the legislation.

Sources: The McGill Daily / Canada opposes EU's labelling of tar sands, Reuters / EU climate chief: science shows Canada oil sand risk, EurActive / Britain accused of stalling EU tar sands regulation.



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