YOUR CHALLENGE

On 24/10/2008 the European Council as the last one of the three involved European institutions adopted a directive amending the directive 2003/87/EC so as to include aviation activities in the EU Emissions Trading System (EU ETS). This directive was published in the Official Journal of the European Union on 13/01/2009 and became effective on 02/02/2009.

Target of directive: the CO2 emissions of the aviation sector should be reduced by means of this decision. As of 2012 all airlines with traffic to, from and within the EU are only allowed to emit 97% of the overall cap of 2004-2006.

As an aircraft operator you should not only think about integrating the consequences of climate change into your business strategy, but take immediate action to avoid unnecessary expenses! As an airline can consume up to 100.000 t of fuel a year, failure to implement approved monitoring can incur additional expenses of up to 6 million Euro* (*100.000 t of kerosene produces 315.000 t of CO2 x 30 Euro per certificate).

The first deadline for the submission of the Monitoring Plans was the 31st August 2009, followed by several different delivery dates mandated by the numerous member states. All airlines with flights to, from and within the EU, must submit a detailed plan describing the procedures in place to monitor and report aircraft emissions and tonne-kilometers starting from 2010. Failure to submit the Monitoring Plans may lose the EU free allowance for carbon emissions and result in millions of Euros of additional cost or even a prohibition of flight operations in the EU.

PROLOGIS objective is to make it easier for airlines to comprehend, comply with and reduce costs of Aviation ETS. Our strategy is to offer solutions that are consistent with your business model, relevant to the size of your airline and applicable to your emitting tier level. Our team of experts in emission trading will bring the experience and expertise to your airline to help you adapt to a changing business environment due to ETS. We would be happy to customize a topic portfolio based on your requirements.

OUR SUPPORT

Workshop Emission Trading

Due to the implementation of the EU Directive in the aviation sector PROLOGIS offers a one-day ETS information and discussion workshop to update you with the latest news concerning the EU directive and to discuss what financial consequences are for your company within the coming years, due to the introduction of the EU-ETS!

Preparation of Monitoring Plans (submission deadline of corresponding CA)

Preparation and submission of the T-km Monitoring Plan as well as the annual CO2 emissions Monitoring Plan according to the MRV guidelines and the requirements of the corresponding competent authority. These plans should describe the approach, target procedures and organization to monitor and report the aircraft emissions and the tonne-kilometer data.

Corrective action in case of a rejection of the Monitoring Plans by the competent authority 

Correction, update and enhancement of the Monitoring Plans with the mandatory data and information with regard to the requirements of the competent authority.

Monitoring Plans Adoption and Realization (31 December 2009 Deadline)

The target is to implement the monitoring plans with the respective procedures and processes within the airline that are adapted to your business model and applicable to the size of your company. The objective is also to discover the best balance between reporting requirements (including accuracy) and implementation costs.

Verification Phase I  (as early as January 2010) & verification phase II (2011)

Involve your verifier as early as possible to avoid failure of attestation and hectic rework in the limited time period after the close of 2010 up to submission of your verified reports to the competent authorities by March 31st 2011. The verifiers we work with are offering a two-step approach which places the mandatory checks of your infrastructure, processes, quality assurances and risk assessments already into the year 2010. So that the remaining task for the 1st quarter 2011, the verification of your annual emissions and tone kilometers reports, can be executed in diligent but expedited manner.

MRV Final Check & Pre-audit (31 March 2011 Deadline)

To ensure the verifier's approval in order to comply with the regulatory necessities and to be granted free allowances, with adapted processes and organization to your business model. PROLOGIS will support your airline to avoid penalties created by imprecise reporting or related risks and reducing the cost of verification.

Analysis and Optimization of ETS strategies

• Identification of strategies and trade-offs to optimize the amount of reported tonne-kilometers in 2010 to optimize the number of free allowances taking the opportunity cost of a free allowance into consideration.
• Identification of possible short, medium and long term emission abatement strategy options, e.g. aircraft technology, operational improvements or fleet management. For each prospective technical and efficiency improvement option, PROLOGIS will prepare an action plan for a respective business process redesign and implementation.
• Detection and quantification of the potential network related competitive advantage or disadvantage that your airline might gain / endure as a result of the introduction of Aviation ETS on a case-by-case basis.
• Identification of strategies that will enable your airline to take the maximum benefit of ETS or at least to minimize its burden.

Carbon Trading Strategy

Emission Trading in Aviation is a market-based approach causing a requirement for airlines either reducing their own CO2 emissions, buy and sell emission certificates in the European market, or invest in emission reduction projects internationally. We expect that airlines will be confronted with limited abatement options, especially over the short-term, so that carbon trading will have to become an essential part of an airline’s financial strategy. PROLOGIS will support you identify and implement an effective carbon trading strategy, setting up the right internal organization and business processes as well as assure that your carbon strategy is aligned with other key processes within your airline.

 

Do you have any questions or would you like more information?

We look forward to hearing from you!

Contact: Gerd Pontius