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Euro ETS fraud by airlines put at €1.36 billion last year

The only thing that will make fuel users choose non fossil carbon releasing products over those to which they are addicted could be to make them cheaper by virtue of innovation rather than state direction.

A report implying massive fraud by European airlines to rob consumers through fictitious claims about the costs of their obligations to the EU’s emission trading scheme needs to be read and understood by all parties to the carbon tax and trading debate in Australia.

Fraud is fraud no matter what position as to the reduction of carbon emissions is taken.

It is also a reminder of a scenario concerning reduced fossil sourced carbon emission by industrial and all transport processes, whether land, sea or air based.

And that is that while the US has avoided comprehensive regulatory intervention along the lines of a carbon tax or an ETS, it is in a race with China to devise and control the replacement energy technologies, which Australia will ultimately have to buy and use at whatever price the owners of the new technology decide to charge.

This combination of state and private capital funded energy innovation, whether in interim bio fuel blends, or a full suite of efficiency measures plus algal grown and refined fossil sourced fuel replacements is not being driven by regulation whether current or planned but potential rewards.

Maybe the alternative way ahead in this country is to make Australia an incredibly generous place to invest in research into and production of fossil carbon bypass technology.

The only thing that will make fuel users choose non fossil carbon releasing products over those to which they are addicted could be to make them cheaper by virtue of innovation rather than state direction.

While the pure intentions of Brussels toward driving the switch to alternative technology are accepted, a system that involves massive dishonesty and fraud is surely not the way forward.

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  • 1
    2353
    Posted January 24, 2013 at 8:34 am | Permalink

    Ben,

    Do you really think that a Country which will suffer greatly from climate change but still has politicians, media and a vocal minority of the public decrying it’s very existence would invest (or permit favorable treatment of private investment) in the research and commercialisation of products to alleviate the effects of carbon emissions?

    Unfortunately I don’t.

  • 2
    Ben Sandilands
    Posted January 24, 2013 at 8:49 am | Permalink

    Well I do, but that’s not important.

    We will, at some stage in the nearer future, have no choice but to use the cheaper product, regardless as to where the other ferocious arguments about climate change go.

    (I agree with the science, for the record. I despair over the inability of the science to lucidly and convincingly make a case that isn’t diluted by side show issues, but that’s a hopefully civilised discussion that might eventually occur elsewhere.)

    Then again, I’m very much on the side of less public intervention and more risk capital coming into play than is currently the case.

    I respect and listen to and I hope learn from contrary nuances in such discussions.

  • 3
    DrStoat
    Posted January 24, 2013 at 6:30 pm | Permalink

    CE Delft is a ‘not-for-profit’ environmental research and consultancy organisation that has an significant stake in ensuring that its key customer (the EU Commission)is not made to look bad. As the AEA pointed out, the airlines had to acquire carbon credits at the then-prevailing price, not to mention the significant costs sunk into getting reporting mechanisms put in place (more consultants) to provide the EU with the data it wanted. The real fraud was making people think this burden placed on airlines would somehow magically result in reduced emissions, in the continuing absence of the EU Commission doing anything about a unified European airspace, the single greatest cost in terms of fuel burn for many carriers in and flying to the EU.

  • 4
    Ben Sandilands
    Posted January 24, 2013 at 6:52 pm | Permalink

    That’s a fair observation. However after exploring the Euractiv site and re-reading its ETS story, I think the report reflected not only poorly on the airlines but the legislators.

    The EU’s fascination with administrative infrastructure is I think very short on the actions that will genuinely promote investment in innovation. The frustration felt across Europe with excessive administration unfortunately in my opinion also strengthens the lunar extremes of politics in various parts of the continent, and a collection of islands to the NW.

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