Our Position On Carbon Pricing

Our best-practice approach to carbon pricing and sustainable development is based on simple principles and aligns with the world’s leading eco-airlines.

Carbon Pricing

A maximum 2 degree Celsius rise in global temperatures is our goal.

We recognise that the mainstream science of climate change is correct; emissions from human activities are having an impact on our climate, and unabated this poses an unacceptable negative risk to the global economy, community and environment within which we and future generations must live. Whilst the science indicates that some early negative impacts are already largely unavoidably locked-in as a result of historical emissions, we agree that action can and must still be taken to reduce the further exponential burden on our economy, community and environment. To achieve this objective our aspirational goal is zero net emissions for the global air transport system. We recognise that the technological solutions exist. We deem it ultimately inevitable that once impacted and educated a democratic global community will vote for increasingly greater action and regulation around climate. We believe that for those nations and businesses that have innovated and moved early this will be one of the greatest wealth generating opportunities ever seen.

The aviation industry has demonstrated a commitment to reducing emissions, reaching agreement to implement a global market-based system in the near future. The progress in aircraft and engine technology to increase fuel efficiency, as well as strides in sustainable aviation fuel development, has been demonstrated to be effective in reducing the emission intensity of aviation. Unfortunately aviation net emissions continue to rise and this trend will continue without a change in the underlying market fundamentals. This can only be necessarily achieved by pricing the market externality that is ‘carbon’ (greenhouse gases) at a sufficient level.

We recognise we have a responsibility to work constructively with governments and communities on the climate issue and are committed to playing our part in the policy solutions to this and to all environmental and social challenges.

Accordingly, our position on carbon pricing is to encourage an approach that considers the follwing principles:

• Global: A global approach is preferable to a country-by-country patchwork approach, which is administratively burdensome and may create counter-productive incentives. International carbon markets should be linked so that investment occurs in the ways that are most economically efficient.
• Clear and enduring: Periods of regulatory uncertainty should be minimised so that businesses can invest with confidence. Carbon pricing schemes should include a transition period to enable business and the economy to adapt.
• Efficient pricing measures: While our preference is for a strong global market-based system, as formally endorsed by the aviation industry through IATA and ICAO, in the interim we are committed to working with governments on other policy measures that can mitigate climate change.
• Incentifising: Measures should not be punitive where possible rather they should encourage investment and innovation in sustainable energy and low emissions technologies and associated infrastructure.
• Revenue neutral: Any funds raised by governments by carbon pricing should be ring fenced and hypothecated towards supporting sustainable energy solutions and used to compensate consumers.
• Secure: Independent global bodies should be set up and well resourced to regulate, administer and audit carbon markets to ensure confidence and minimise adverse conduct.
• Effective: Any carbon offsets permitted under a carbon-pricing scheme should be additional (beyond business as usual activities), permanent (emissions reductions secured for a determined period of time (>100 years) to guarantee the climate change benefit), avoid double counting (by means of a single global registry), preferably have social and/or environmental co-benefits and finally be monitored and independently verified.
• Complementary measures: Government support and partnerships with the private sector for collaborative investment in emerging sustainable energy technologies should proceed at an accelerated pace.
• Voluntary action: Voluntary initiatives should be recognised and encouraged wherever possible.