Editing EU ETS

Aviation

Helping aircraft operators to manage their carbon risks

Aviation is one of the fastest-growing sources of greenhouse gas emissions. Since 2012 emissions from all flights that originated, terminated or crossed the European Economic Area (EEA) were included in the [http://www.redshawadvisors.com/aviation/ EU ETS]. The legislation applies to EU and non-EU airlines alike. However, ‘Stop the Clock' legislation for the period 2013-2016 has led to the exclusion of non-intra EU flights. Intra EU flights will still be fully covered. If the directive is not readjusted by the EU, application of the original legislation will come into effect from 2017.

Click here for VerifAvia's latest carbon market update for airlinesverifavia

What is an EUAA?

A European Union Aviation Allowance (EUAA) is a CO2 emission right that allows airlines that fall under the regulations of the European Emission Trading Scheme to pollute one metric ton of CO2. In 2012, each airline received 85% of the available EUAAs for free from their administrating state. The remaining 15% were auctioned. If an airline's allocation of EUAAs is less than they need they may buy much cheaper Certified Emission Reductions (CERs) or Emissions Reduction Units (ERUs) up to 15% of the total amount of allowances they needed to hand in at the end of 2012. The remaining deficit must be covered by EUAAs or EU Allowances (EUAs). If the 15% is not fully utilised then this may be carried forward indefinitely. From 2013 each aircraft operator shall be entitled to use international credits up to a maximum of 1.5 % of its verified emissions during the period from 2013 to 2020, without prejudice to any residual entitlement from 2012. EUAAs can trade at a discount to EUAs.

What can Redshaw Advisors do for you?

Allowances for 2013 and 2014 emissions will have to be surrendered by 30th April 2015 and on a yearly basis thereafter. Airlines will need to manage their risk and Redshaw Advisors can help achieve this in the most cost effective manner by providing a combination of EUAAs, EUAs, CERs and ERUs. EUAAs are likely to always trade at some small discount to EUAs. Redshaw Advisors are experts in the relevant carbon markets we can provide viable risk management solutions for all of your needs. Redshaw Advisors are able to execute tailor made carbon strategies, we offer EUAA / EUA / CER / ERU conversions, EUAA structuring and execution.