1. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 1 Providing employment, trade links, tourism and support for sustainable development through air travel 07 March 2013 ICAO COUNCIL BRIEFING Paul Steele Executive Director - ATAG

2. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 2 AVIATION: AN ECONOMIC ENGINE

3. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 3 OUR CLIMATE ACTION Targets are at the global level – not on States or operators Targets do not mean slowing down the growth of aviation

4. © ATAG 2012 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 4 DECLARATION

5. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 5 1 2 3 4 THE FOUR PILLARS

6. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 6 INDUSTRY MAKING PROGRESS TOWARDS OUR GOALS

7. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 7 COORDINATED ACTION OperatorsAirportsManufacturersANSPs

8. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 8 TECHNOLOGY EVOLUTION The strides in aircraft technology. Available today… and tomorrow 12% - 18% lower fuel use than current 737 15% lower fuel use than current A320

9. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 9 NEW AIRCRAFT DELIVERIES Renewing the fleet with more energy-efficient aircraft Source: IATA Economics

10. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 10 NEW AIRCRAFT DELIVERIES Airlines will spend $1.3 trillion on new aircraft from 2013 – 2020 Source: IATA Economics

11. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 11 DELIVERIES GOING FORWARD Commercial Aircraft Deliveries

12. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 12 DELIVERIES GOING FORWARD: 2012 - 2031 68,000 new aircraft across a range of different sizes Source: Rolls-Royce

13. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 13 AVIATION BIOFUELS: A QUICK WIN 10% of fuel ~80% CO2 reduction 1500+ flights 190 airports

14. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 14 PARTNERSHIPS FOR SUSTAINABLE AVIATION

15. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 15 GOVERNMENTS NEED TO HELP - BIOFUELS Support supply chain collaboration Establish global sustainability criteria De-risk investmentsProvide incentivesUnderstand local opportunities Foster research

16. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 16 GOVERNMENTS NEED TO HELP – ATM Observe the ASBU framework for ATM modernization Establish effective and sustainable regulatory practices Support civil/military cooperation and flexible use of airspace Support the introduction of new technologies and procedures Explore new or alternative models of service provision

17. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 17 ROLE OF MBMs

18. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 18 OUR CLIMATE ACTION

19. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 19 MEETING CARBON NEUTRAL GROWTH Total CO2 from air transport, mT per year forecast and offsets required to meet CNG2020 Source: IATA Economics

20. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 20 ROLE OF MBMS MBMs are part of a total package of measures to reduce CO2 emissions MBMs should be seen as a “gap-filler” to complement technology, operational and infrastructure measures MBMs should contribute to the delivery of other measures – not be an objective in themselves or designed to slow the growth of aviation MBMs should be viewed as transitional and temporary measures until other measures deliver sufficient reductions to reach medium and long term targets ICAO needs to play an important role in regulating MBMs for aviation Industry believes MBMs have a specific role:

21. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 21 AVOIDING THE PATCHWORK

22. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 22 EMISSIONS CHARGES IN EFFECT

23. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 23 INDUSTRY VIEW Key criteria for the industry

24. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 24 PERSPECTIVES ON A SINGLE GLOBAL MBM Industry believes that a single global mechanism is the ONLY way to satisfy all criteria Mandatory offsetting may represent the simplest, easiest and fastest way forward 1 Mandatory offsetting 2 + additional revenues 3 Global emissions trading scheme

25. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 25 PERSPECTIVES ON THE FRAMEWORK In the absence of a single global mechanism a framework needs to be carefully and tightly defined to: Ensure environmental integrity Avoid market and competitive distortion Avoid costly and non-scaleable administrative complexity A weak framework will promote the proliferation of overlapping and costly MBMs Once these measures are in place it will be very difficult to remove or replace them A framework must therefore be tightly defined and effective as a transition mechanism to a global MBM scheme for aviation Industry has significant concerns on the current framework discussions:

26. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 26 FRAMEWORK – THE WAY FORWARD Reaffirm common mid-term and long-term goals: Carbon Neutral Growth from 2020 2050 Goal of 50% reduction compared to 2005 levels Recognise MBMs as a “gap-filler” to other measures Agree to develop a single, scaleable MBM mechanism by 39 th Assembly Ensure consistency of MBMs allowable under a framework in the interim Agree acceptable types of carbon credits under an offsetting MBM Agree geographic scope of application Agree single state reporting for operators Request Council to develop ICAO standard on MRV by 39 th Assembly Industry urges the ICAO 38 th Assembly to:

27. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 27 FRAMEWORK – THE WAY FORWARD Reaffirm all principles for MBMs from A37-19 including: Avoiding duplication of accounting for the same emissions Minimizing carbon leakage Minimizing market distortions Assuring administrative simplicity – including scaleability for small operators Industry urges the ICAO 38 th Assembly to:

28. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 28 INDUSTRY NEXT STEPS ON MBMS Continuing roll-out of identified efficiency measures: Fleet renewal On-going R&D in airframe and engine design Pushing for ATM upgrades/improvements Operational flight techniques Driving commercialisation of aviation biofuels Evaluating options to operationalize CNG2020 including options for addressing SCRC at operator level Industry is continuing work in a number of areas:

29. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 29 FINDING THE RIGHT SOLUTION An aviation solution to a climate problem… not a climate solution to an aviation problem.

30. © ATAG 2013 WWW.AVIATIONBENEFITSBEYONDBORDERS.ORG 30 Providing employment, trade links, tourism and support for sustainable development through air travel 07 March 2013 ICAO COUNCIL BRIEFING Paul Steele Executive Director - ATAG