Considerations on COM(2021)561 - Ensuring a level playing field for sustainable air transport - Main contents
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| dossier | COM(2021)561 - Ensuring a level playing field for sustainable air transport. |
|---|---|
| document | COM(2021)561  |
| date | October 18, 2023 |
(2) From 2020, air transport has been one of the hardest hit sector by the COVID-19 crisis. With the perspective of an end to the pandemic in sight, it is expected that air traffic will gradually resume in the coming years and recover to its pre-crisis levels. At the same time, emissions from the sector have been increasing since 1990 and the trend of increasing emissions could return as we overcome the pandemic. Therefore, it is necessary to prepare for the future and make the necessary adjustments ensuring a well-functioning air transport market that contributes to achieving the Union’s climate goals, with high levels of connectivity, safety and security.
(3) The functioning of the Union air transport sector is determined by its cross-border nature across the Union, and by its global dimension. The aviation internal market is one of the most integrated sectors in the Union, governed by uniform rules on market access and operating conditions. The air transport external policy is governed by rules established at global level at the International Civil Aviation Organisation (ICAO), as well as by comprehensive multilateral or bilateral agreements between the Union or its Member States, and third countries.
(4) The air transport market is subject to strong competition between economic actors across the Union, for which a level playing field is indispensable. The stability and prosperity of the air transport market and its economic actors relies on a clear and harmonised policy framework where aircraft operators, airports and other aviation actors can operate on the basis of equal opportunities. Where market distortions occur, they risk putting aircraft operators or airports at a disadvantage with internal or external competitors. In turn, this can result in a loss of competitiveness of the air transport industry, and a loss of air connectivity for citizens and businesses.
(5) In particular, it is essential to ensure a level playing field across the Union air transport market regarding aviation fuel, which account for a substantial share of aircraft operators’ costs. Variations in fuel prices can affect significantly aircraft operators’ economic performance and negatively impact competition on the market. Where differences in aviation fuel prices exist between Union airports or between Union and non-Union airports, this can lead aircraft operators to adapt their refuelling strategies for economic reasons. Fuel tankering increases aircraft’s fuel consumption and results in unnecessary greenhouse gas emissions. Fuel tankering by aircraft operators accordingly undermines of the Union’s efforts towards environmental protection. Some aircraft operators are able to use favourable aviation fuel prices at their home base as a competitive advantage towards other airlines operating similar routes. This can have detrimental effects on the competitiveness of the sector and be harmful to air connectivity. This Regulation should set up measures to prevent such practices in order to avoid unnecessary environmental damage as well as to restore and preserve the conditions for fair competition on the air transport market.
(6) A key objective of the common transport policy is sustainable development. This requires an integrated approach aimed at ensuring both the effective functioning of Union transport systems and protection of the environment. Sustainable development of air transport requires the introduction of measures aimed at reducing the carbon emissions from aircraft flying from Union airports. Such measures should contribute to meeting the Union’s climate objectives by 2030 and 2050.
(7) The Communication on a Sustainable and Smart Mobility Strategy 10 adopted by the Commission in December 2020 sets a course of action for the EU transport system to achieve its green and digital transformation and become more resilient. The decarbonisation of the air transport sector is a necessary and challenging process, especially in the short term. Technological advancements, pursued in European and national research and innovation aviation programmes have contributed to important emission reductions in the past decades. However, the global growth of air traffic has outpaced the sector’s emissions reductions. Whereas new technologies are expected to help reducing short-haul aviation’s reliance on fossil energy in the next decades, sustainable aviation fuels offer the only solution for significant decarbonisation of all flight ranges, already in the short term. However, this potential is currently largely untapped.
(8) Sustainable aviation fuels are liquid, drop-in fuels, fully fungible with conventional aviation fuel and compatible with existing aircraft engines. Several production pathways of sustainable aviation fuels have been certified at global level for use in civil or military aviation. Sustainable aviation fuels are technologically ready to play an important role in reducing emissions from air transport already in the very short term. They are expected to account for a major part of the aviation fuel mix in the medium and long term. Further, with the support of appropriate international fuel standards, sustainable aviation fuels might contribute to lowering the aromatic content of the final fuel used by an operator, thus helping to reduce other non-CO2 emissions. Other alternatives to power aircraft, such as electricity or liquid hydrogen are expected to progressively contribute to the decarbonisation of air transport, beginning with short-haul flights.
(9)The gradual introduction of sustainable aviation fuels on the air transport market will represent an additional fuel cost for airlines, as such fuel technologies are currently more expensive to produce than conventional aviation fuel. This is expected to exacerbate the pre-existing issues of level playing field on the air transport market as regards aviation fuel, and to cause further distortions among aircraft operators and airports. This regulation should take measures to prevent that the introduction of sustainable aviation fuels affects negatively the competitiveness of the aviation sector by defining harmonised requirements across the Union.
(10)At global level, sustainable aviation fuels are regulated at ICAO. In particular, ICAO establishes detailed requirements on the sustainability, traceability and accounting of sustainable aviation fuels for use on flights covered by the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). While incentives are set in CORSIA and sustainable aviation fuels are considered an integral pillar of the work on the feasibility of a Long-Term Aspiration Goal for international aviation, there is currently no mandatory scheme on the use of sustainable aviation fuels for international flights. Comprehensive multilateral or bilateral air transport agreements between the EU or its Member States, and third countries generally include provisions on environmental protection. However, for the time being, such provisions do not impose on contracting parties any binding requirements on the use of sustainable aviation fuels.
(11)At EU level, general rules on renewable energy for the transport sector are set out in Directive (EU) 2018/2001 of the European Parliament and of the Council 11 . In the past, such horizontal cross-sectoral regulatory frameworks have not proven effective to operate a transition from fossil fuels to sustainable aviation fuel in air transport. Directive (EU) 2018/2001 and its predecessor set out overarching targets across all transport modes to be supplied with renewable fuels. As aviation is a small fuels market for which renewable fuels are more costly to produce while a fully integrated European transport market, in comparison to other transport modes, such regulatory frameworks should be complemented with aviation-specific measures to effectively boost the deployment of sustainable aviation fuels. Further, national transpositions of Directive (EU) 2018/2001 risks creating significant fragmentation in the air transport market, where national rules on sustainable aviation fuels would set out widely differing targets. This would be expected to further exacerbate the issues of level playing field in air transport.
(12) Therefore, uniform rules need to be laid down for the aviation internal market to complement Directive (EU) 2018/2001 and to deliver on its overall objectives by addressing the specific needs and requirements arising from the EU aviation internal market. In particular, the present Regulation aims to avoid a fragmentation of the aviation market, prevent possible competitive distortions between economic actors, or unfair practices of cost avoidance as regards the refuelling of aircraft operators.
(13) This regulation aims in the first instance to set out a framework restoring and preserving a level playing field on the air transport market as regards the use of aviation fuels. Such a framework should prevent divergent requirements across the Union that would exacerbate refuelling practices distorting competition between aircraft operators or putting some airports at competitive disadvantage with others. In a second instance, it aims to gear the EU aviation market with robust rules to ensure that gradually increasing shares of sustainable aviation fuels can be introduced at EU airports without detrimental effects on the competitiveness of the EU aviation internal market.
(14) It is essential to set harmonised rules across the EU internal market, applying directly and in a uniform way to aviation market actors on the one hand, and aviation fuels market actors on the other hand. The overarching framework set out by Directive (EU) 2018/2001 should be complemented with a lex specialis applying to air transport. It should include gradually increasing targets for the supply of sustainable aviation fuels. Such targets should be carefully defined, taking into account the objectives of a well-functioning air transport market, the need to decarbonise the aviation sector and the current status of the sustainable aviation fuels industry.
(15) The present Regulation should apply to aircraft engaged in civil aviation, carrying out commercial air transport flights. It should not apply to aircraft such as military aircraft and aircraft engaged in operations for humanitarian, search, rescue, disaster relief or medical purposes, as well as customs, police and fire-fighting operations. Indeed, flights operated in such circumstances are of exceptional nature and as such cannot always be planned in the same way as regular flights. Due to the nature of their operations, they may not always be in a position to fulfil obligations under this Regulation, as it may represent unnecessary burden. In order to cater for a level playing field across the EU aviation single market, this regulation should cover the largest possible share of commercial air traffic operated from airports located on EU territory. At the same time, in order to safeguard air connectivity for the benefits of EU citizens, businesses and regions, it is important to avoid imposing undue burden on air transport operations at small airports. A threshold of yearly passenger air traffic and freight traffic should be defined, below which airports would not be covered by this Regulation; however, the scope of the Regulation should cover at least 95% of total traffic departing from airports in the Union. For the same reasons, a threshold should be defined to exempt aircraft operators accountable for a very low number of departures from airports located on EU territory.
(16) Development and deployment of sustainable aviation fuels with a high potential for sustainability, commercial maturity and a high potential for innovation and growth to meet future needs should be promoted. This should support creating innovative and competitive fuels markets and ensure sufficient supply of sustainable aviation fuels for aviation in short and long term to contribute to Union transport decarbonisation ambitions, while strengthening Union’s efforts towards a high level of environmental protection. For this purpose, sustainable aviation fuels produced from feedstock listed in Parts A and B of Annex IX of Directive (EU) 2018/2001, as well as synthetic aviation fuels should be eligible. In particular, sustainable aviation fuels produced from feedstock listed in Part B of Annex IX of Directive (EU) 2018/2001 are essential, as currently the most commercially mature technology to decarbonise air transport already in the short term.
(17) For sustainability reasons, feed and food crop-based fuels should not be eligible. In particular, indirect land-use change occurs when the cultivation of crops for biofuels displaces traditional production of crops for food and feed purposes. Such additional demand increases the pressure on land and can lead to the extension of agricultural land into areas with high-carbon stock, such as forests, wetlands and peatland, causing additional greenhouse gas emissions and loss of biodiversity concerns. Research has shown that the scale of the effect depends on a variety of factors, including the type of feedstock used for fuel production, the level of additional demand for feedstock triggered by the use of biofuels and the extent to which land with high-carbon stock is protected worldwide. The highest risks of indirect land-use change have been identified for biofuels, fuels produced from feedstock for which a significant expansion of the production area into land with high-carbon stock is observed. Accordingly, feed and food crop-based fuels should not be promoted. This approach is in line Union policy and in particular with Directive (EU) 2018/2001 which limits and sets a cap on the use of such biofuels in road and rail transport, considering their lower environmental benefits, lower performance in terms of greenhouse reduction potential and broader sustainability concerns. In addition to the greenhouse gas emissions linked to indirect land-use change – which is capable of negating some or all greenhouse gas emissions savings of individual biofuels – indirect land-use change poses risks also to biodiversity. This risk is particularly serious in connection with a potentially large expansion of production determined by a significant increase in demand. The aviation sector has currently insignificant levels of demand for food and feed crops-based biofuels, since over 99% of currently used aviation fuels are of fossil origin. It is therefore appropriate to avoid the creation of a potentially large demand of food and feed crops-based biofuels by promoting their use under this Regulation. The non-eligibility of crop-based biofuels under this Regulation also minimises any risk to slow down the decarbonisation of road transport, which could otherwise result from a shift of crop-based biofuels from the road to the aviation sector. It is essential to minimise such a shift, as road transport currently remains by far the most polluting transport sector.
(18) A single, clear and robust sustainability framework is necessary to provide certainty for the aviation and fuels industries actors, on the eligibility of sustainable aviation fuels under this Regulation. To ensure consistency with other related EU policies, the eligibility of sustainable aviation fuels should be determined according to compliance with the sustainability criteria established in Article 29 of Directive 2018/2001 12 .
(19) The present Regulation should aim to ensure that aircraft operators can compete on the basis of equal opportunities as regards the access to sustainable aviation fuels. To avoid any distortions on the air services market, all Union airports covered by this Regulation should be supplied with uniform minimum shares of sustainable aviation fuels. Whereas the market is free to supply and use larger quantities of sustainable fuel, this Regulation should ensure that the mandatory minimum shares of sustainable aviation fuels are the same across all the covered airports. It supersedes any requirements established directly or indirectly at national or regional level requiring aircraft operators or aviation fuel suppliers to uptake or supply sustainable aviation fuels with different targets than the ones prescribed under this Regulation. In order to create a clear and predictable legal framework and in doing so encourage the market development and deployment of the most sustainable and innovative with growth potential to meet future needs fuel technologies, this Regulation should set out gradually increasing minimum shares of synthetic aviation fuels over time. Setting out a dedicated sub-obligation on synthetic aviation fuels is necessary in view of the significant decarbonisation potential of such fuels, and in view of their current estimated production costs. When produced from renewable electricity and carbon captured directly from the air, synthetic aviation fuels can achieve as high as 100% emissions savings compared to conventional aviation fuel. They also have notable advantages compared to other types of sustainable aviation fuels with regards to resource efficiency (in particular for water needs) of the production process. However, synthetic aviation fuels’ production costs are currently estimated at 3 to 6 times higher than the market price of conventional aviation fuel. Therefore, this Regulation should establish a dedicated sub-obligation for this technology. Other types of synthetic fuels, such as low carbon synthetic fuels achieving high greenhouse gas reductions, could be considered for inclusion in the scope of this Regulation in the course of future revisions, where such fuels become defined under the Renewable Energy Directive.
(20) It is essential to ensure that the minimum shares of sustainable aviation fuels can be successfully supplied to the aviation market without supply shortages. For this purpose, sufficient lead-time should be planned to allow the renewable fuels industry to develop production capacity accordingly. The supply of sustainable aviation fuels should become mandatory starting in 2025. Similarly, in order to provide legal certainty and predictability to the market and drive investments durably towards sustainable aviation fuels production capacity, the terms of this Regulation should be stable over a long period of time.
(21) With the introduction and ramp-up of sustainable aviation fuels at Union airports, practices of fuel tankering may be exacerbated as a consequence of aviation fuel costs increases. Tankering practices are unstainable and should be avoided as they undermine the Union’s efforts to reduce environmental impacts from transport. Those would be contrary to the aviation decarbonisation objectives as increased aircraft weight would increase fuel consumption and related emissions on a given flight. Tankering practices also put at risk the level playing field in the Union between aircraft operators, and also between airports. This Regulation should therefore require aircraft operators to refuel prior to departure from a given Union airport. The amount of fuel uplifted prior to departures from a given Union airport should be commensurate with the amount of fuel necessary to operate the flights departing from that airport, taking into account the necessary compliance with fuel safety rules. The requirement ensures that equal conditions for operations in the Union applying equally to Union and foreign operators, while ensuring high level of environmental protection. As the Regulation does not define a maximum share of sustainable aviation fuels in all aviation fuels, airlines and fuel suppliers may pursue more ambitious environmental policies with higher sustainable aviation fuels uptake and supply in their overall network of operations, while avoiding fuel tankering.
(22) Airports covered by this Regulation should ensure that all the necessary infrastructure is provided for delivery, storage and refuelling of sustainable aviation fuel, so as not to constitute an obstacle with respect to the uptake of such sustainable aviation fuel. If necessary, the Agency should be able to require a Union airport to provide information on the infrastructure available allowing for seamless distribution and refuelling of aircraft operators with sustainable aviation fuels. The role of the Agency should allow airports and airlines to have a common focal point, in the event where technical clarification is necessary on the availability of fuel infrastructure.
(23) Aircraft operators should be required to report yearly to the Agency on their purchases of sustainable aviation fuel, as well as on the characteristics of this fuel. Information should be provided on the characteristics of the sustainable aviation fuels purchased such as inter alia nature and origin of the feedstock, conversion pathway and lifecycle emissions.
(24) Aircraft operators should also be required to report yearly on their actual aviation fuel uplift per Union airport, so as to prove that no fuel tankering was performed. Reports should be verified by independent verifiers and transmitted to the Agency for monitoring and assessment of compliance. Verifiers should determine the accuracy of the yearly aviation fuel required reported by the operators using a tool approved by the Commission.
(25) Aviation fuel suppliers should be required to report yearly in the Union database referred to in Article 28 of Directive (EU) 2018/2001, on their supply of aviation fuel, including sustainable aviation fuels. The Agency should report on a yearly basis to the Commission on the fulfilment by aircraft operators and aviation fuel suppliers of their respective obligations under this Regulation. This is important for the Commission to have clear visibility on the level of compliance to the Regulation.
(26) It is not possible without additional procedures to determine accurately whether aircraft operators have actually physically uplifted shares of sustainable aviation fuels in their tanks at a specific Union airports. Therefore, aircraft operators should be allowed to report their use of sustainable aviation fuels based on purchasing records. Aircraft operators should be entitled to receive from the aviation fuel supplier the information that is necessary to report the sustainable aviation fuel purchase.
(27) It is essential that aircraft operators can claim the use of sustainable aviation fuels under greenhouse gas schemes such as the EU Emissions Trading System or CORSIA, depending on the route of their flights. However, it is essential that this regulation should not lead to a double counting of emissions reductions. Aircraft operators should only be allowed to claim benefits for the use of an identical batch of sustainable aviation fuels once. Fuel suppliers should be requested to provide free of charge to aircraft operators any information pertaining to the properties of the sustainable aviation fuel sold to that aircraft operator and that is relevant for reporting purposes by the aircraft operator under this Regulation or greenhouse gas schemes.
(28) In order to ensure a level playing field of the aviation internal market and the adherence to the climate ambitions of the Union, this Regulation should introduce effective, proportionate and dissuasive penalties on aviation fuel suppliers and aircraft operators in case of non-compliance. The level of the penalties needs to be proportionate to the environmental damage and to the prejudice to the level-playing field of the internal market inflicted by the non-compliance. When imposing administrative fines, the authorities should take into account the evolution of the price of aviation fuel and sustainable aviation fuel in the reporting year;
(29) The penalties for the suppliers who fail to meet the targets set in this Regulation should be complemented by the obligation to supply the market with the shortfall of meeting the quota in the subsequent year;
(30) This Regulation should include provisions for periodic reports to the European Parliament and the Council on the evolution of the aviation and fuels markets, the effectiveness of key features of the Regulation such as the minimum shares of sustainable aviation fuels, the level of administrative fines or policy developments on sustainable aviation fuels uptake at international level. Such elements are key to provide a clear state of play of the sustainable aviation fuels market and should be taken into account when considering a revision of the Regulation.
(31) A transitional period of 5 years should be provided to allow for a reasonable amount of time for aviation fuel suppliers, Union airports and aircraft operators to make the necessary technological and logistical investments. During this phase, aviation fuel containing higher shares of sustainable aviation fuel may be used to compensate for lower shares of sustainable aviation fuels or for the reduced availability of conventional aviation fuel at other airports.
(32) Since the objective of this Regulation, namely to maintain a level playing field on the Union air transport market while increasing the use of sustainable aviation fuels, cannot be sufficiently achieved by the Member States due to the cross-border nature of aviation, but can rather, by reason of the characteristics of the market and effects of the action, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve that objective.