Aviation, Growth and Environmental Policy Challenges--The Need to Reduce Emissions

Susan M. Gander, Senior Policy AnalystCenter for Clean Air PolicyPresentation to: NASA Environmental Compatibility Assessment Workshop - IV, Colorado Springs, COAugust 12-23, 1999

The Center for Clean Air Policy

Environmental think-tank founded in 1985 by progressive state governors to help find a market-based approach to reducing acid rain

Working to apply similar cost-effective approaches to reducing ozone, greenhouse gases, air toxics

Active participant in climate negotiations; leading dialogue on greenhouse gas emissions trading; active in EPA/FAA process on aviation NOx reductions

On-going effort to investigate policy measures for addressing aviation emissions

Overview of Key Points

Aviation impacts both local air quality and global climate

Aviation emissions expected to grow considerably

Technology improvements and additional policy options needed to address emissions growth

Aviation Emissions are a Concern Locally, Globally

Aviation emissions of NOx, VOC, air toxics are a concern for local air quality

Aviation Emissions of CO2, NOx, H20, SOx and soot are a concern for global climate change

Ozone Poses Serious Challenge to States, Localities

Efforts to address ground-level ozone on-going since 1970’s, but problem persists

70 million people living in areas that exceed the federal ozone standard (1995)

Stationary, mobile and area sources are all being squeezed to minimum emissions levels, but this still not enough to meet our clean air goals

NOx Emissions from Aircraft Grew 111% in Past 25 years

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1970 1975 1980 1985 1990 1995

Year

Thousands of Short Tons

111% Growth

1970-1995

93% Growth

1970-1990

Source: National Air Pollutant Emission Trends, 1990-1995. US EPA, October 1996

Aircraft’s Share of Total Regional NOx Emissions is Growing

1990 (Actual) and 2010 (Projected)

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Atlanta Boston Charlotte New York Philadelphia Washington

Percent

1990

2010

Source: Evaluation of Air Pollutant Emissions from Subsonic Commercial Jet Aircraft, U.S. EPA

Other Sources Asked to Make Significant NOx Reductions

Ozone Transport Rule (1998) Calls for 28% cut in NOx -- 64% cut by utilities

Non-road Diesel Engine Standards (1998) 46% cut in NOx by 2015

Heavy-Duty Diesel Engines Standards (1997) Cuts allowable NOx emissions rate by 50%

Locomotive Standards (1998) 45% reduction in NOx by 2015

Small Engine Standards (1997/98) 32% reduction in NOx and VOCs by 2015

Climate Change is the Leading Global Environmental Challenge

Scientists worldwide agree there is a discernable human influence on global climate

Projections for 2100 (IPCC): Average surface temp. will rise by about 2oC Average sea level will rise by about 50 cm.

Will need a 50% to 70% GHG reduction from today’s levels to reach stabilization at 2X pre-industrial levels

Climate Change Linked to Serious Environmental, Health Concerns

Sea level rise, damages to coastal areasChanges in growing seasons and

vegetation patternsDramatic shifts in weather patternsDisease vectors

Environmental Effects Carry Economic & Social Implications

Loss of agricultural cropsLoss of forest resourcesNew threats to public healthImpacts on water resources

IPCC Report Predicts Growth in GHG Emissions

Aircraft emissions increasing 3-fold (1992) .14 Gt Carbon, 2% anthropogenic (2050) .40 Gt Carbon, 3% anthropogenic

.23 Gt to 1.5 Gt Carbon range of projections• 1.6 to 10 times the 1992 value

Aircraft radiative forcing growing 3.8 times (1992) .05 W/m2, 3.5% anthropogenic (2050) .19 W/m2, 5% anthropogenic

.13 to .56 W/m2 range• 2.6 to 11 times the 1992 value

Projections of Global CO2 Emissions from Aviation

The Kyoto Protocol

Agreed to in December 1997 by 150+ countries “Developed” countries agreed to reduce GHG

emissions 5% below 1990 levels by 2008-2012 EU, other European countries reduce to 8% below US reduces to 7% below Russia and Ukraine stabilize at 1990 levels Australia, Iceland, Norway allowed to increase

Six gases : CO2, CH4, N2O, HFCs, PFCs, SF6

Details under development

US Target Calls for 30%+ Cut from BAU Emissions

Aviation Emissions Covered under the Kyoto Protocol

Domestic emissions covered in country inventories

International emissions covered under Article 2.2 “The parties included in Annex I shall pursue

limitation or reduction of emissions of greenhouse gases … from aviation … bunker fuels, working through the International Civil Aviation Organization...

Range of Options for Aviation Emissions Reductions

Technology (e.g., fuel efficiency, NOx emission rates, APU “fuel switch”) but aircraft “fuel switching” not currently viable

Operation (e.g., single engine taxiing, improved payload estimation)

CNS/ATM (e.g., improved routing, optimal climb and descent)

Technology improvements and gains in efficiency not enough to offset growth

Technology, Efficiency Gains not Enough to Offset Growth

IPCC Special Report on Aviation: Although improvements in aircraft and engine

technology and in the efficiency of the air traffic system will bring environmental benefits, these will not fully offset the effects of the increased emissions resulting from the projected growth in aviation.

Emissions Trading Offers Potential for Cost-Effective Reductions

Trading among airlinesOpt-ins for ground support equipment

(GSE) -- that contribute as much as 30% of airport emissions

Options for reductions in other sectors and other countries

Kyoto Protocol Includes Several Flexibility Mechanisms

“Emissions Bubbles” -- joint fulfilment of Annex I commitments

Emissions Trading (transfer of “assigned amounts”)

Annex I Joint Implementation (project-based) CDM (project-based credits sold by developing

countries to Annex I parties; may start in 2000)

Explanation of Trading

Countries/companies are assigned emissions budgets

Those with actual emissions < budget may sell credits not needed; those with actual emissions > budget must buy

Reason that some buy, others sell: Differences in cost

Trading: An Illustration

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Company A Company B

Regulated Companies

Annual Emissions

(tons/year) Emissions Before Regulation

Emissions After Regulation

EMISSIONS CAP

Benefits of Trading

Low costs Capital is directed to low-cost reduction

opportunities; total cost is minimized

Technological innovation Companies have a direct financial incentive

to develop new technologies

Environmental effectiveness Lower costs makes compliance easier Strong penalties for non-compliance

Disadvantages of Trading

Higher upfront administrative costs associated with getting a system up and running -- though overall costs are lower

Greater potential for “gaming” than under “command and control” approaches.

May not work for all areas or all pollutants because of “hot spots” -- though this doesn’t hold for global polutants such as CO2.

Acid Rain SO2 Trading Program: US Success Story

Cap of 8.95 million tons SO2 for utility sector with trading nation-wide

100% complianceActive trading marketCost of allowances = $200 per ton,

compared to pre-implementation estimates of $2,000 per ton and more

Minimum administrative costs

More Examples of Trading Programs

Trading of NOx allowances in OTC (US -- NOx

British Petroleum’s internal GHG program (worldwide -- CO2), British Airways (under development)

EPA’s banking and trading program during phaseout of lead from gasoline (US)

Greenhouse Gas Emission Reduction Trading Pilot (GERT) and Pilot Emission Reduction Trading Pilot (PERT) programs (Canada -- CO2, SOx and NOx)

Joint implementation under the UNFCCC (worldwide) Emission Reduction Market System (ERMS) (Chicago, IL --

VOCs -- to begin in FY 2000)

Conclusions

Growth in aviation emissions at odds with clean air and climate change goals

Continued technology improvements are critical to addressing concerns

Additional policy options also needed to address emissions growth

Emissions trading offers cost-effective option for emissions reductions