Ireland’s subsidies for aviation fuel may be reviewed after COP26 deal
The Irish government may need to review aviation subsidies worth hundreds of millions of euros in response to the outcome of of the COP26 negotiations. This Irish support totalled €2.4 billion in 2019, according to Central Statistics Office data, and was dominated by the excise duty exemption for jet kerosene. Separately, airports received €23 million in state aid this year to compensate for pandemic-related losses, on top of a similar figure last year. The Irish environment minister, Eamon Ryan, said the European Commission wanted to resurrect plans to impose a minimum tax rate for aviation fuels as part of its 2030 climate plan. This proposal was parked when the pandemic hit. Airlines have fought against the tax. In last year’s general election, the Green Party campaigned to end “harmful subsidies that prioritise flying” and reintroduce the €10 air passenger travel tax abolished during the last recession. The issue of whether to agree globally on limiting fossil fuel subsidies was a key part of the COP negotiations, with producing countries (and others) deeply opposed to meaningful cuts.
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Ireland’s aviation subsidies may be reviewed after Cop26 deal, climate minister warns
The government may need to review aviation subsidies worth hundreds of millions of euros in response to a global climate deal being finalised in Glasgow, the climate minister has said.
By Valerie Flynn (The Times)
November 13 2021
The [Irish] government may need to review aviation subsidies worth hundreds of millions of euros in response to a global climate deal being finalised in Glasgow, the climate minister has said.
The draft deal, which calls on governments to “accelerate the phase-out of . . . inefficient fossil fuel subsidies”, could require Ireland to look at its own support for fossil fuels in transport, Eamon Ryan told reporters last night as talks at Cop26 went into extra time.
This support totalled €2.4 billion in 2019, according to Central Statistics Office data, and was dominated by the excise duty exemption for jet kerosene.
Separately, airports received €23 million in state aid this year to compensate for pandemic-related losses, on top of a similar figure last year.
Ryan noted that the European Commission wanted to resurrect plans to impose a minimum tax rate for aviation fuels as part of its 2030 climate plan. This proposal was parked when the pandemic hit. Airlines including Ryanair have previously argued that any tax on fuel would be damaging for the sector, which is required to buy EU pollution permits for each tonne of CO2 emitted.
In last year’s general election, the Green Party campaigned to end “harmful subsidies that prioritise flying” and reintroduce the €10 air passenger travel tax abolished during the last recession.
Ryan said yesterday evening that he was hopeful the most ambitious part of the draft deal in Glasgow would remain in the final text. Ireland is part of a “high ambition coalition” at the talks, which is pushing for the strongest possible language on ensuring the global temperature rise can be limited to 1.5C, rather than the 2C goal that the UN climate negotiations aimed for until recently.
He noted that at a plenary session held yesterday to take stock of progress “there wasn’t a big unwinding on the fossil fuel subsidies”, or any push to step back from the 1.5C ambition.
… and it continues on general COP issues …
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The latest draft proposal from the Cop26 chair, released soon after 7am on Friday in Glasgow, calls on countries to accelerate “the phaseout of unabated coal power and of inefficient subsidies for fossil fuels.”
A previous version on Wednesday had called on countries to “accelerate the phasing out of coal and subsidies for fossil fuel.”
The addition of “inefficient” could help countries that want to retain some fuel subsidies for the poor, while removing subsidies for major fossil fuel interests. This change to the language could also provide cover for countries that want to retain subsidies, however.
The issue of fossil fuel subsidies has long vexed climate experts, with calls to reduce the subsidies over two decades going largely unheeded. However, to have any language on phasing out fossil fuels and subsidies to them in the cover decision of a Cop is new and if the provision is retained in the final outcome it will mark an increased determination by many countries to face down fossil fuel producers at the talks.
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See earlier:
EC draft shows EU to propose aviation fuel tax in efforts to cut European CO2 emissions
The European Commission has drafted plans to set an EU-wide minimum tax rate for aviation fuels, as it seeks to meet more ambitious targets to fight climate change. The EC is drafting an overhaul of EU energy taxation, as part of a package of measures it will propose on July 14, to meet a target to reduce EU greenhouse gas emissions by 55% by 2030, from 1990 levels. The draft proposes taxing aviation fuel, as its continuing exemption “is not coherent with the present climate challenges and policies.” From 2023, the minimum tax rate for aviation fuel would start at zero and increase gradually over a 10-year period, until the full rate is imposed. The draft proposal did not specify what the final rate would be. A recent survey suggests that Europeans support the taxation of aviation fuel. Even factoring in the impact of the pandemic, aviation emissions are expected to grow between 220-290% by 2050 compared to 2015 levels, which would be disastrous for the climate. Airlines favour carbon offsetting schemes, rather than fuel tax; but these allow them to continue polluting even though offsets have been repeatedly found to be largely ineffective.
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