AUSTRIA FAVORS INCLUDING INTERNATIONAL AVIATION IN EU

UNCLAS VIENNA 003470 SIPDIS SIPDIS E.O. 12958: N/A TAGS: EAIR SENV ECON AU SUBJECT: AUSTRIA FAVORS INCLUDING INTERNATIONAL AVIATION IN EU EMISSIONS TRADING SCHEME REFS: STATE 190254 ¶1. On November 24, post conveyed reftel talking points and non-paper to Helmut Hojesky, Head of the Climate Protection and Air Pollution Control Department in the Ministry of Agriculture and Environment; to Manfred Bialonczyk, Director General of the Civil Aviation Administration in the Ministry of Transportation; and to Christian Krepela, Head of the Environment and Transportation Department in the Ministry of Foreign Affairs. ¶2. We followed up on November 30 with Hojesky, whose ministry has the lead on this issue. Hojesky voiced skepticism regarding the ability of ICAO to facilitate an agreement to include aviation emissions in an international scheme to reduce emissions. According to Hojesky, the slow and unsteady pace of the ICAO discussions was one of the reasons the EU had decided to take action unilaterally. Hojesky noted that the Commission's current proposal is based on the December 2005 Council Conclusions. He opined that the proposal enjoys broad support amongst Member States. ¶3. Hojesky said, at earliest, inclusion of aviation emission in the Emissions Trading Scheme (ETS) would not come into effect before the end of the current Kyoto implementation strategy in 2008-2012. If the Commission presents its proposal by the end of 2006, as expected, it would take up to one and a half years to adopt a directive. It would take an additional two years for Member States to implement the directive, followed by the technical allocation of limits. When we pressed him, Hojesky acknowledged that the GoA would continue to discuss aviation emissions within the ICAO context. ¶4. Hojesky admitted that the Commission's proposal faces several hurdles. The EU had opted for emissions trading as the most acceptable alternative to taxes and surcharges. Hojesky noted that, obviously, the 1947 Chicago Convention, and most, if not all, bilateral air agreements do not address emissions trading. ¶5. We followed up with Krepala, the POC for environmental issues in the MFA, on December 1. He emphasized that inclusion of aviation emissions in the EU's ETS did not "fall out of the sky." The EU has been discussing this intensively since the UK Presidency. Krepala said he had "some sympathy" for the USG position, but he stressed that Europe wanted to protect its citizens from the dangers of aviation emissions, the fastest growing emission pollutant. ¶6. Krepala conceded that there are competition issues, which the EU would need to iron out, including the possibility that international carriers would "fly around Europe" to avoid the ETS. Krepala added that EU deliberations are in an initial stage, with "a watered down compromise" a possible outcome. ¶7. Comment: Although there are slight differences between the environmental and transportation ministries, we do not expect the GoA to raise objections to the Commission's approach. End Comment. MCCAW#