Assessment of the International Civil Aviation Organization's basket of measures to reduce aviation CO2 emissions

The project is a Social Science and Humanities Research Council of Canada (SSHRC) $108,000, 4-year project. Aviation has a major impact on the climate system and accounts for up to 9 per cent of the total climate change impact of human activity. Moreover, at a time when we urgently need to reduce this impact, greenhouse gas (GHG) emissions from aviation continue to grow. Since 1990, GHG emissions from international aviation have increased 83 per cent. The aviation industry is expanding rapidly, in part due to regulatory and taxing policies that do not reflect the true environmental costs of flying. The International Civil Aviation Organization (ICAO), tasked under the United Nations Framework Convention on Climate Change (UNFCCC) to lead global action to reduce GHG emissions from aviation, has produced a Basket of Measures to Reduce Aviation GHG Emissions (the Basket) (ICAO, 2013). The Basket consists of two types of measures: (1) technology advances, including (a) green aircraft, (b) operational efficiencies, and (c) alternative fuels; as well as (2) market-based measures (MBMs), which provide flexibility to emitters by giving them alternative methods of reducing emissions including emission taxes and various emissions trading schemes (Keen et al., 2012). So far only a few studies have investigated the environmental impacts of these measures (e.g. Ahmad, 2014) and limited attention has been paid to the indirect consequences of the Basket on aviation market dynamics such as airline competition. This gap is problematic as airlines are strategic players and will respond to these measures by considering other players’ behaviors, which in turn might impact their emission levels. The overall purpose of this 4-year project is to undertake a systematic evaluation of select measures within the Basket as well as their corresponding market and environmental consequences. Project objectives are to:

•      Compare the conditions under which different types of technological advances might be adopted by airlines and impact such adoption would have on GHG emission reduction (Module I);

•      Investigate the market and environmental consequences of air-rail intermodal cooperation, a case of aviation operational improvements (Module II); 

•      Compare the effects of various MBMs on reducing aviation GHG emissions under different conditions (Module III); and

•      Empirically test the effect of including aviation within the European Union Emission Trading Scheme (EU-ETS), the largest MBM in the world (Module IV).