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Aviation climate deal seen a win for airlines, less so for earth

The United Nations (UN) accord reached Thursday to clean up pollution from international aviation may cost airlines as much as $23.9 billion annually by 2035. The companies see it as a victory.

A Japan Airlines Corp. (JAL) aircraft lands at the Osaka International Airport, operated by New Kansai International Airport Co., at dusk in Toyonaka City, Osaka, Japan, in this file photo on  June 27, 2015.  (Bloomberg)

A Japan Airlines Corp. (JAL) aircraft lands at the Osaka International Airport, operated by New Kansai International Airport Co., at dusk in Toyonaka City, Osaka, Japan, in this file photo on June 27, 2015. (Bloomberg)

The landmark deal brokered in Montreal creates a global system requiring airlines to compensate for emissions growth after 2020 by funding environmental initiatives. That spares carriers from exactly what they had pushed to avoid: A patchwork of regional environmental regulations that probably would have been even more costly.

The accord is less of a win for the planet, at least in the eyes of environmentalists. The deal is voluntary for countries during the first six years. It covers only international flights, not domestic. Rather than forcing emission cuts, it allows airlines to increase pollution in exchange for buying credits that support renewable energy development, forest preservation and other environmental efforts. And while costs will run into the billions, the price per flight will be low enough that it may not impact airfares.

“This agreement is a timid step in the right direction when we need to be sprinting,” said Greenpeace UK Chief Scientist Doug Parr. “The aviation industry has managed to get away for years with doing nothing about its growing carbon-emission problem, and now it’s giving itself even more years to do very little.’’

First Ever

Exhaust from international flights accounts for about 2 percent of global greenhouse gases and is expected to triple by 2050. Airlines were left out of the Paris climate accord because of the challenge of divvying up responsibility for global routes. The deal reached in Montreal is the first international framework to regulate emissions from a single industry.

Not all environmentalists are bemoaning the accord. At least 65 nations have agreed to join during the voluntary phases, including the US, China and Europe. That’s enough to cover about 83 percent of international air traffic responsible for 65 percent of the industry’s emissions. The Environmental Defense Fund estimates the accord’s impact will be the equivalent of removing about 35 million cars from roads each year.

Green Financing

Other winners in the deal include the clean energy industry and companies that develop projects to reduce greenhouse gases flowing into the atmosphere. Requiring airlines to buy carbon offsets to compensate for their increased emissions may open up billions in financing for solar farms, reforestation projects and programs to cut industrial gases. The UN’s aviation agency estimates that by 2025, airlines will spend $1.5 billion to $6.2 billion on credits backing such projects annually. By 2035, they will spend $5.3 billion to $23.9 billion.

“It could mean a significant source of low-carbon development financing,’’ said Annie Petsonk, international counsel for the Environmental Defense Fund.

The agreement, brokered by the UN’s International Civil Aviation Organization, capped more than six years of negotiations. As with any global deal, there were compromises.