WHAT DOES THIS ADD UP TO?
It is not clear this money would go to countries needing help to deal with climate change. Some nations say it should go to the shipping industry to help it decarbonise.
But the fact that an industry responsible for around 3 per cent of global emissions has taken such a step is already piling fresh pressure on the aviation industry, which in turn has started to demand fossil fuel companies stump up more cash.
“If we are raising money, I would say let’s raise money from the people who have money,” Marie Owens Thomsen, chief economist at the airline industry’s International Air Transport Association, told one lively panel discussion at Baku last week.
Her industry’s collective annual profit was just US$31 billion, she said, less than the recent earnings of some single oil supermajors.
Countries also deliver billions of dollars a year in fossil fuel subsidies “straight into the hands of oil companies” that could instead be used to finance the energy transition, she added.
The aviation industry is right to be worried. It is subject to a global carbon offsetting scheme agreed in 2016. But even if the system guarantees permanent, additional cuts in emissions, which some doubt, it’s not designed to generate revenue, says a recent IMF paper.
That’s why the solidarity levies task force is studying ways to broaden existing plane ticket duties that at least 21 countries have already imposed, a move estimated to raise as much as US$164 billion a year.
Precisely what all this will add up to is unknown. Even if more countries adopt levies on things like air tickets, diverting revenues from national treasuries to poorer countries needing climate finance is a big step.
But one thing is clear. The days when new carbon levies were deemed too politically impossible to be on the table are well and truly over.
Source: CNA
