The main elements of the compromise are as follows:
All flights starting and/or landing in Europe (including intercontinental flights) to be included in the ETS from 1 January 2012;
The EU to have an obligation to seek an agreement on global measures to reduce greenhouse gas emissions from aviation. Bilateral agreements, for example with the US, could be a first step;
85 percent of the emissions certificates to be allocated for free according to a common European benchmark. 15 percent to be auctioned;
The reduction target to be calculated on the basis of airlines' average annual emissions between 2004-2006: in the first period (2012), airline emissions to be cut by 3 percent; in the second, from 2013 onwards, by 5 percent. The percentage to be further modified as part of the general review of the ETS;
The revenues generated from the auctioning of emissions allowances should be used to fund:
climate change mitigation;
research on clean aircraft;
anti-deforestation measures in the developing world;
The deal says that "It shall be for Member States to determine the use to be made of revenues generated from the auctioning of allowances. Those revenues should be used to tackle climate change in the EU and third countries, inter alia, to reduce greenhouse gas emissions, to adapt to the impacts of climate change in the EU and third countries, especially developing countries, to fund research and development for mitigation and adaptation, including in particular in the fields of aeronautics and air transport, to reduce emissions through low-emissions transport, and to cover the cost of administering the scheme. The proceeds of auctioning should also be used to fund contributions to the Global Energy Efficiency and Renewable Energy Fund, and measures to avoid deforestation."
Commenting on the compromise deal he helped broker over the last few weeks, Peter LIESE (EPP-ED, DE), EP rapporteur on emissions, said: "Of course, a global agreement is our final goal, but the inclusion of third country flights starting and landing in Europe is a major step for the global fight against climate change. Other industries like steel would very much like to be in such a situation."
The Parliament, said Mr Liese, has fought for very strict provisions concerning the revenues from auctioned allowances. "Money should be used to tackle climate change and not disappear somewhere in the general budget. It is not a tax but an environmental instrument. This is why we are very engaged in this field. The agreement is not perfect, but the Council went further than on any other comparable occasion."
Highlighting the importance of funding public transport to reduce emissions, Mr Liese added: "people should be encouraged to use buses and trains - for example by reducing taxes and charges on [such] low emissions transports."
Exemptions for some
light airplanes with a take-off weight under 5.7 tonnes,
flights for humanitarian purposes under a UN mandate,
fire-fighting and other emergency flights,
police, customs and military flights
Research flights are excluded from the scheme, and
Small airline companies producing low emissions are excluded.
Government and Head of State flights included
Flights performed exclusively for the transport, on official mission, of a reigning Monarch and his immediate family, Heads of State, Heads of Government and Government Ministers, of an EU Member State are included.
According to the European Commission's impact assessment: "Fully passing on costs to customers would mean that by 2020 airline tickets for a return journey could increase by €4.6 to €39.6, depending on the journey length."
The compromise was adopted with 640 votes in favour, 30 against and 20 abstentions.