ATA Letter to Chairman Dingell and Chairman Boucher Addressing Climate Change

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At the same time, commercial aviation is critically important to local, national and global economies, underpinning a large percentage of economic output. A March 2006 study by the Campbell-Hill Aviation Group found that “the national economy is highly dependent on commercial aviation, which is directly or indirectly responsible for 5.8 percent of gross output, 5.0 percent of personal earnings and 8.8 percent of national employment.”⁵ The study further noted that this translated into $380 billion in earnings, 11.4 million jobs and $1.2 trillion in U.S. output in 2004. By placing our economic output side by side with our GHG output, it is clear that we are extremely carbon efficient.

Commercial Aviation Has Made Dramatic Fuel Efficiency Improvements

The reason that we have been able to deliver continually more value to the economy even as we have dramatically reduced our carbon footprint is because we are constantly improving our fuel efficiency. Commercial aviation has achieved a 70 percent improvement in fuel efficiency in the past 30 years, and a 34 percent improvement since 2001 alone. In fact, absolute fuel consumption of U.S. carriers in 2006 remained 5 percent below the peak reached in 2000, though carriers transported 12 percent more passengers and 22 percent more cargo.⁶

GHG Emissions are not an “Economic Externality” for Airlines, as Demonstrated by Our Efficiency Improvements

Fuel is now the largest cost center for airlines, averaging 20 to 30 percent of total operating costs, and has long been one of the two highest costs. Since GHG emissions are directly related to fuel burn, GHG emissions are not an “economic externality” for airlines: we have been, are and will continue to be driven by an economic imperative to reduce fuel consumption and thus GHG (and other) emissions.

Our record speaks for itself. Even in a highly constrained financial environment, airlines invest heavily in capital and technology to realize the remarkable fuel efficiency gains mentioned above. Airlines have gone beyond relying on obvious means and have left no stone unturned to reduce fuel use, including implementation of innovative operational measures and equipment weight-reduction programs, and the development of cutting-edge flight software to enable our pilots to fly the most direct routes. Examples of the specific measures that the ATA airlines have taken are provided in response to Question 5, below.

Commercial Aviation Will Continue to Reduce GHG Emissions

In the future, commercial airlines will continue to reduce the GHG intensity of their operations, as airframe and engine manufacturers continue to make better, more efficient equipment available.⁷ In addition, airlines will continue to innovate, seeking more opportunities to deploy new design, software and operational measures of the type identified in answer to Question 5.

However, because airlines already have achieved such tremendous fuel efficiency improvements, additional near-term improvements necessarily will be evolutionary, rather than revolutionary. We have made our achievements in fuel efficiency primarily by demanding new airframe, engine and other technologies from manufacturers and investing billions of dollars to acquire them. As a result, this equipment and technology already has been driven to currently achievable fuel efficiency limits, and revolutionary advances are not expected in the near term. In addition, aircraft are extremely expensive capital commodities, with a useful economic life of 30 years or more. As a result, unlike some other sectors – which either have not pursued efficiency improvements as aggressively or are not as reliant on such high-cost, low turnover equipment – commercial aviation will, of necessity, rely on evolutionary advances to achieve fuel efficiency improvements in the near term.

Aviation is One of the Few Sectors Where Additional Significant Improvements in GHG Efficiency Depend on Congressional Support

Aircraft technology is only one piece of the fuel efficiency puzzle. Another piece – one that is entirely in the hands of Congress and the Federal Aviation Administration (FAA) – is ATM technology. Studies consistently have shown that modernization of the ATM system will improve fuel efficiency and reduce GHG emissions by 10 to 15 percent. Put another way, inefficiencies in the current ATM system are responsible for at least 10 to15 percent of the GHGs from commercial aviation. To date, the airlines have worked closely with the FAA to improve efficiency within the existing ATM system. Examples include: Reduced Vertical Separation Minimums (RVSM) and continuous descent approaches (CDA). We are also working with the FAA and other agencies on a fundamental redesign of the ATM system through the Next Generation Air Transportation System (NextGen) project. The FAA reauthorization legislation now before Congress will support NextGen by providing for the satellite-based navigation technology that is indispensable in eliminating inefficient routings, congestion and delays. ATA is supporting the modernization initiative through our “Smart Skies” initiative.⁸ Congress should also encourage the FAA to proceed with air space redesign efforts in the nation's most congested airspaces, allowing airlines to reduce emissions and fuel consumption. As Congress is a key player in ensuring the future of our ATM system, we hope that your Committee will provide its support.

Further improvements also hinge on congressional funding for aeronautics research and development. As previously pointed out, commercial aviation will continue to improve the GHG intensity of its operations in the near term through evolutionary advances in airframe and engine technology and through implementation of operational measures to reduce fuel burn. Given the significant achievements to date, further revolutionary advancements in technology can only come through massive investments in basic aeronautics research and development programs at NASA and FAA, which only government can provide. The pending FAA reauthorization legislation contains such a program, the Consortium for Lower Energy, Emissions and Noise Technology Partnership (CLEEN), which would take much-needed, initial steps to support research that will accelerate the introduction of more fuel-efficient, low-emissions technology into the fleet. See H.R. 1356, 110^th Cong. § 606 (2007). Such government-led R&D also serves to preserve American leadership in aeronautics and, thus, an extremely important component of our economy.

Commercial Aviation’s Unique Features and Economic Impact Should Guide Congress on GHG Legislation

In our view, the key challenge Congress faces with respect to potential legislation that would further address the U.S. commercial airline industry’s GHG emissions is how to maintain the industry’s economic competitiveness in a global market.

As a first step, Congress should take steps to facilitate further GHG reductions within the industry, without imposing additional financial burden on the industry. In this regard, Congress should move quickly to modernize our nation’s ATM system and ensure that costs are allocated among stakeholders equitably. Further, Congress should support the research and development necessary to continue to achieve technology advances that will allow us to reduce GHGs without sacrificing economic opportunity. To be blunt, this means reversing recent drastic reductions in federal support for basic aeronautics research.

In addition, careful consideration must be given to the question of whether the economic underpinnings of putative regulatory schemes, such as cap-and-trade or carbon charges, make sense when applied to commercial aviation. Specifically, any regulatory scheme that is intended to send a “carbon price signal” to drive investment needs to be considered very carefully to ensure it has the intended effect of incentivizing industry to reduce GHG emissions. In this context, the aspects of the commercial aviation industry discussed above have the following policy implications:

• Airlines already “internalize” the cost of GHG emissions because they are dependent on fossil fuels to operate. As discussed above, this feature already drives airlines to reduce fuel consumption – and associated GHGs – as much as possible, such that GHG charges or a cap-and-trade system, are not necessary.
• Additional carbon-based costs would have the perverse effect of reducing resources available to airlines to acquire capital assets and technology needed to realize achievable GHG reductions.

o As outlined above, fuel costs already have driven available aviation technologies to feasible fuel efficiency maximums (carbon emission minimums). Stated differently, capital already has been funneled to the most fuel-efficient alternatives available to our industry, as demonstrated by the fuel efficiency improvements discussed above. The economic benefits of these improvements will continue drive investment to develop whatever feasible future means exist to further improve fuel efficiency. Added costs will not change the fact that the industry must rely on acquisition of equipment and technology for additional fuel efficiency improvements. To the contrary, added costs will compromise our ability to invest in advanced equipment and technology as they become available.

o A significant factor in realizing additional significant fuel efficiency improvements is not in our control. Increasing the cost of carbon emissions to the industry, for example, will not change the fact that needed ATM improvements depend on federal government action.

o Given the tremendous strides commercial aviation already has made to become very fuel efficient, a cap on commercial aviation emissions would put us in the perverse position of having to buy allowances from industries that have done dramatically less than we have to control GHGs; in essence, even though aviation is a small contributor of GHGs, aviation would be subsidizing emissions reductions in other sectors.

• In light of these factors unique to the U.S. commercial airline industry, if Congress were to adopt legislation aimed at reducing GHG emissions that included the commercial aviation industry, such legislation should, at a minimum:

o Not punish sectors, like ours, that already have dramatically reduced the GHG intensity of their activities in past decades; any baseline GHG emission limit needs to credit past achievements and account for sector differences;

o Be implemented in tandem with federal support for infrastructure improvements (such as in the ATM system) without which significant, identified GHG reductions will not be possible. Otherwise industry will be faced with added costs without the means to respond to those costs – the carbon price signal becomes a disincentive.

ICAO is the Logical Forum for Addressing the GHG Emissions of Commercial Aviation

Several factors about climate change science and commercial aviation lead to the conclusion that ICAO is the most logical forum for addressing GHG emissions from commercial aviation.

The “borderless” nature of the climate change problem distinguishes it from other environmental issues: indeed, the beneficial actions of one nation could be undone by the inaction of others. Further, unilateral action has significant competitive implications for a country’s industries. This is of particular concern with respect to the U.S. commercial aviation industry, given its global nature; a significant part of our operations are international and U.S. airlines compete vigorously with foreign airlines in both the passenger and cargo sectors.

To address this concern, Congress should look to opportunities to address this global industry on a global basis. As discussed below, ICAO is uniquely positioned to achieve a global solution for the aviation sector and already has made considerable progress toward achieving such a solution. Thus, we urge Congress to allow the ICAO process to play out.

Recognizing that coordination between countries is needed to facilitate international aviation, ICAO has been charged with establishing standards and recommended practices for international aviation pursuant to the Convention on International Civil Aviation, commonly referred to as the “Chicago Convention.” One hundred eighty-nine countries, including the United States, are parties to the Chicago Convention. The world’s airlines and related government bodies have been fully engaged on the climate change issue for many years. Since 1998, ICAO, which is charged with setting emissions standards for aircraft,⁹ has been studying how to further reduce GHGs from aviation, consistent with the imperative that safety must remain the prevailing consideration.

Based on its extensive studies, ICAO specifically has endorsed the use of voluntary measures and has adopted formal guidance on voluntary agreements as well as guidance entitled “Operational Opportunities to Minimize Fuel Use and Emissions,” which ATA and its member carriers helped develop. In light of this work, countries such as Japan and Canada, both of whom are parties not only to the United Nations Framework Convention on Climate Change (UNFCCC) but also to the Kyoto Protocol, and whose economies are closely aligned to the United States, have chosen to address the GHGs from their aviation sectors through voluntary agreements targeting specific fuel efficiency goals.¹⁰ ICAO also has undertaken study of GHG taxes and charges and emissions trading, and concluded that GHG taxes and charges are not cost effective. Specifically, assuming a hypothetical target of a 25 percent decrease in projected growth of emissions, ICAO found that GHG taxes/charges would cost $47 billion annually on a worldwide-basis.¹¹ (Considering that the U.S. share of global aviation is approximately 34 percent,¹² this would translate to a cost to U.S. carriers of approximately $16 billion annually.) ICAO found that targeting absolute emissions would be even more costly. For example, a hypothetical target of a 5 percent absolute reduction from 1990 levels was estimated to cost approximately $245 billion annually if implemented on a worldwide basis.¹³ In light of these considerations, in 2004, ICAO member states agreed to a moratorium on implementation of GHG charges on international aviation through the ICAO Assembly meeting in September 2007, when this issue will again be discussed.

Despite the general consensus among ICAO member states that a well-designed emissions trading system would be more cost effective than taxes or charges on aviation activity, ICAO has also found that emissions trading, nonetheless, would be very expensive for aviation. This is because aviation is fossil-fuel dependent, as alternative fuels that are now available for some industry sectors simply are not viable for commercial jet aircraft, and airlines already are driven to be as fuel efficient as possible. ICAO analysis of the costs puts this in context. Assuming a hypothetical target of a 25 percent decrease in projected growth of emissions, ICAO found that open emissions trading would cost the airlines $17 billion annually on a worldwide basis if “baseline” allowances were auctioned, or $1.63 billion annually if all “baseline” allowances were grandfathered (i.e., distributed free of charge);¹⁴ the U.S. share of these costs would be approximately $5.8 billion and $550 million, respectively, annually. Further, a hypothetical target of a 5 percent absolute reduction from 1990 levels was estimated to cost over $60 billion annually on a worldwide basis if “baseline” allowances were auctioned, or $17.3 billion annually if all “baseline” allowances were grandfathered;¹⁵ the U.S. share of these costs would be approximately $20.4 billion and $5.9 billion, respectively, again on an annual basis.

In light of the fact that aviation already is incentivized to minimize fuel burn and resulting GHGs, and in light of the significant costs of open emissions trading, ICAO has declined to adopt an emissions trading system for international aviation or to recommend that its members do so. Accordingly, we urge Congress to decline to adopt such a system for U.S. commercial aviation alone and to defer to ICAO for further work on this issue. However, should Congress consider covering U.S. aviation in a U.S. trading regime, it should take into account ICAO guidance on emissions trading.¹⁶

ANSWERS TO SPECFIC QUESTIONS

Based on the considerations in this overview, I now turn to the specific questions you have posed. All of the answers provided below are intended to complement the points made above and are subject to our fundamental position that:

• Commercial airlines already are an extremely fuel-efficient driver of the local, national and global economies
• Legislation designed to “internalize” the cost of GHG emissions for commercial airlines is unnecessary and likely counterproductive
• Congress should act quickly to realize the achievement of significant, demonstrable GHG reductions by supporting the modernization of the nation’s ATM system and supporting basic aeronautical research and development
• ICAO is the most logical forum for further addressing GHG emissions from commercial aviation

Your questions appear in bold, italicized typeface, followed by our responses in regular typeface. Please note that these are initial responses, as the dialogue on potential legislation is just now beginning. Should Congress more specifically consider covering commercial aviation with GHG legislation, we would like to weigh in further as any such concepts are developed.

1. Please outline which issues should be addressed in the Committee’s legislation, how you think they should be resolved, and your recommended timetable for congressional consideration and enactment. For any policy recommendations, please address the impacts you believe the relevant policy would have on:

1. emissions of greenhouse gases and the rate and consequences of climate change; and

2. the effects on the U.S. economy, consumer prices and jobs.

As noted above, fuel efficiency, i.e., improved energy intensity, is key to addressing GHGs in fossil-fuel dependent sectors like transport. This, coupled with further development of alternative fuels where feasible, not only decreases GHGs but addresses another key airline and U.S. objective, which is to increase U.S. energy independence within a framework of economic security. Accordingly, we support approaches that use the technology and innovation of a healthy economy to improve energy intensity. As discussed in detail above, the aviation industry has a proven record of continually improving its fuel efficiency and its energy intensity without regulatory mechanisms directing this, and applying regulatory “carbon price signal” mechanisms to this industry likely would be counterproductive.

One specific area where congressional action can help is by quickly advancing modernization of the FAA ATM system. As discussed above, this action alone will greatly improve efficiency and reduce GHG emissions. Also, Congress should adopt programs like CLEEN, to conduct research and development on low-emissions technology science, to support the development of improved technologies and accelerate their availability for incorporation into the fleet. However, for the reasons discussed, new legislation should not force aviation into a broad GHG regulatory scheme. We believe that would reduce the ability of airlines to invest in newer and better technology to reduce GHG emissions and would harm the ability of U.S. airlines to compete in the global aviation marketplace.

2. One particular policy option that has received a substantial amount of attention and analysis is “cap-and-trade.” Please answer the following questions regarding the potential enactment of a cap-and-trade policy:

1. Which sectors should it cover? Should some sectors be phased in over time?

As noted above, the marketplace already incentivizes the U.S. commercial airline industry to be as fuel efficient as possible and ensures that this industry responsibly controls its GHG emissions. Accordingly, we do not believe it is necessary to apply emissions trading to aviation, and to do so would be counterproductive.

2. To what degree should the details be set in statute by Congress or delegated to another entity?

If an emissions trading program is going to be pursued, Congress should establish the core elements and design features in as much detail as possible so the implementing agencies have clear direction.

3. Should the program’s requirements be imposed upstream, downstream or some combination thereof?

Some “upstream” industries, such as the electricity generating industry, which have not yet pursued identified opportunities to increase fuel efficiency or to otherwise reduce GHGs, have indicated that they are willing and able to pursue those opportunities. This would seem like a logical starting point. However, we have some concern about applying across-the-board measures on fossil fuel. Given that the commercial aviation industry already is very fuel efficient, adding costs to our purchase of fuel would just draw more resources away from our ability to continue investment in fuel-efficient technology and operational measures. Moreover, aviation fuel is a small market among refined products and aviation fuel prices have increased at a proportionately higher rate than those of gasoline and other motor fuels – a phenomenon known as the “crack spread.” Thus, we urge Congress to take such considerations into account in any system it might devise.

4. How should allowances be allocated? By whom? What percentage of the allowances, if any, should be auctioned? Should non-emitting sources, such as nuclear plants, be given allowances?

If an emissions trading system is pursued, allowances should be issued by the federal government. The allocation system should seek to mitigate the economic impact of transition costs. Accordingly, all or a significant portion of allowances should be grandfathered, rather than auctioned, particularly with respect to industries like the airlines that have no near-term alternatives to fossil fuel, already have invested in fuel-efficient equipment, and can demonstrate objectively specific fuel efficiency improvements. Benchmarking can be applied to the allocation and distribution of grandfathered allowances so that those who have invested in achieving greater fuel efficiency receive credit for their early action. A system that does not reward early action will end up rewarding those industries and entities that have elected to ignore their GHG emissions. With specific regard to non-emitting sources, it would not seem appropriate to issue them allowances.

5. How should the cap be set (e.g., tons of greenhouse gases emitted, CO2 intensity)?

As noted above, any program adopted in the U.S. should focus on energy intensity, which translates to CO₂ intensity. If a cap is established that necessarily means establishing a baseline. As noted, however, we do not believe that the commercial airlines should be included in a cap-and-trade system. If, however, commercial aviation were to be included, the baseline construct would need to look back a sufficient period of time to capture our very significant early actions (noted above) and similar actions by other industries.

6. Where should the cap be set for different years?

If an emissions trading system is set up, it should include economy-wide targets for particular years. However, targets between different sectors should be tailored to factors such as past achievements, additional ability to improve energy intensity in the sector, contribution to the country’s economic output, etc. While we do not believe it necessary or appropriate to cover aviation in a mandatory program for the reasons noted above, if this is done, in addition to these factors, a principle should be that inefficiencies in ATM will not count against the airlines.

7. Which greenhouse gases should be covered?

If there is to be an emissions trading system, only CO₂ should be included at this juncture, as the most is known about the effects of CO₂ and about how to calculate CO₂ emissions. This is consistent with ICAO draft guidance, which recommends against applying any such systems to emissions other than CO₂ at this time. Scientific understanding of any non-CO₂ effects of aviation, particularly emissions at altitude, remains very limited.

8. Should early reductions be credited? If so, what criteria should be used to determine what is an early reduction?

Yes, as noted above, early reductions should be credited, based on fuel efficiency/energy intensity. If early reductions are not credited, industry sectors such as aviation that have a tremendous record of improved energy intensity will be penalized, while latecomers will be rewarded.

9. Should the program employ a safety valve? If so, at what level?

Yes. A safety valve is necessary to ensure economic security. While there could be a safety valve at the economy-wide level, there also should be safety valves at the sector-specific level, so individual sectors are not compromised.

10. Should offsets be allowed? If so, what types of offsets? What criteria should govern the types of offsets that would be allowed?

Yes, if there is to be an emissions trading system, a broad range of verifiable offsets should be allowed.

11. If an auction or a safety valve is used, what should be done with the revenue from those features?

As noted above, we believe that if aviation is to be included in an emissions trading system, the allowances should be allocated based on grandfathering with benchmarking to credit early action. If there is any auctioning, the funds should be channeled to programs (such as tax incentives) that foster technology, infrastructure and operational innovations designed to further address fuel efficiency and/or alternative fuels.

12. Are there special features that should be added to encourage technological development?

Tax incentives could be one route.

13. Are there design features that would encourage high-emitting developing countries to agree to limits on their greenhouse gas emissions?

The focus that we suggest, one of energy intensity, should be appealing to such developing countries.

14. How well do you believe existing authorities permitting or compelling voluntary or mandatory actions are functioning? What lessons do you think can be learned from existing voluntary or mandatory programs?

As noted above, our industry has achieved significant fuel efficiency gains through voluntary action. As also noted, both Canada and Japan, whose economies are closely aligned to the United States in terms of economic development and reliance on air commerce, have chosen to address the GHGs of their aviation sectors through voluntary fuel efficiency agreements and ICAO encourages addressing GHGs through voluntary action. We believe this approach makes sense for our industry given that the market already incentivizes us to reduce fuel burn and resulting GHG emissions.

15. How should potential mandatory domestic requirements be integrated with future obligations the United States may assume under the 1992 United Nations Framework Convention on Climate Change? In particular, how should any U.S. domestic regime be timed relative to any international obligations? Should adoption of mandatory domestic requirements be conditioned upon assumption of specific responsibilities by developing nations?

ICAO has provided guidance on factors that should be taken into account should a country consider including aviation in an emissions trading scheme. Should the U.S. consider applying GHG legislation to commercial aviation, we encourage the United States to take into account ICAO’s work. As explained above, ICAO has recommended against the adoption of GHG taxes or charges for aviation. Also, in light of the fact that aviation already is incentivized to minimize fuel burn and resulting GHGs, and in light of the significant costs of emissions trading, ICAO has declined to adopt an emissions trading system for international aviation or to recommend that its members do so. Finally, any domestic requirements should consider intergovernmental competition and trade implications for U.S. businesses. U.S. companies should not be put at a competitive disadvantage by domestic GHG requirements. As discussed above, these considerations have particular application to commercial aviation and militate for addressing this issue through the existing ICAO process.

16. What, if any, steps have your organization’s members or its individual members taken to reduce their greenhouse gas emissions? Which of these have been voluntary in nature? If any actions have been taken in response to mandatory requirements, please explain which authority (state, federal or international) compelled them?

As detailed above, our airlines have improved their fuel efficiency by 34 percent since 2001, with over a 70 percent improvement in the last 30 years, resulting in commensurate reductions in GHGs. Below are examples of some of the specific measures we have taken in this regard.

Upgrading Fleets - Airlines have expended billions to upgrade their fleets through investments in new airframes and engines, removing less fuel-efficient aircraft from their fleets and improving overall fleet efficiency.

Introduction of Innovative, Cutting-Edge Technologies - Airlines also have invested in technologies to make existing airframes more efficient, for example installing winglets which reduce aircraft drag and thereby reduce fuel consumption. Airlines also have developed software to analyze flight paths and weather conditions, allowing aircraft to fly more direct, efficient routes (subject to air traffic control approval).

Improved In-Flight Operations - Airlines utilize systems to optimize speed, flight path and altitude, which not only reduces fuel consumption in the air, but avoids wasting fuel waiting for a gate on the ground. Airlines also have analyzed redistribution of weight in the belly of aircraft and introduced life vests on certain domestic routes, allowing them to overfly water on a more direct route.

Improved Ground Operations - Airlines also have introduced single-engine taxiing when conditions permit, plug into electric gate power where available to avoid running their auxiliary power units, use tugs to position aircraft where feasible, and have redesigned hubs and schedules to alleviate congestion and converted to electric ground support equipment when feasible.

Reducing Onboard Weight - In recent years, as fuel prices skyrocketed, airlines exhaustively reviewed ways to remove aircraft weight – removing seat-back phones, excess galley equipment and magazines; introducing lighter seats and beverage carts, stripping primer and paint, and a myriad of other detailed measures to reduce weight and improve fuel efficiency.

Looking ahead, one area that has some potential for further GHG reductions from aviation is development of synthetic fuel. To that end, ATA and its members are actively engaged in efforts to develop synthetic jet fuel for commercial aviation. The critical factor here, of course, is ensuring flight safety. While there are many questions that need to be addressed about the widespread use of synthetic fuels in commercial aircraft in the United States, ATA is encouraged by efforts by the Department of Defense, NASA, the FAA, airframe and engine manufacturers, and academic institutions to bring coal-to-liquid (CTL) technology to the marketplace. Any incremental fuel supply, especially if both environmentally friendly and economically viable, is something worth pursuing.

I hope you find this response helpful. Please do not hesitate to contact me if you have any questions regarding the information in this letter.

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¹ ATA members include ABX Air, Alaska Airlines, Aloha Airlines, American Airlines, ASTAR Air Cargo, Atlas Air, Continental Airlines, Delta Air Lines, Evergreen International Airlines, Federal Express Corporation, Hawaiian Airlines, JetBlue Airways Corp., Midwest Airlines, Northwest Airlines, Southwest Airlines Co., United Airlines, UPS Airlines, and US Airways. Associate members are: Air Canada, Air Jamaica Ltd., and Mexicana. ATA airline members alone transport more than 90 percent of all U.S. airline passenger and cargo traffic.

² According to the United States Environmental Protection Agency (EPA), “transportation sources were responsible for about 27 percent of total U.S GHG emissions in 2003,” “[a]ircraft produced about 9 percent of U.S. transportation greenhouse gas emissions in 2003,” and “[c]ommercial aircraft produced 72 percent of U.S. aircraft GHGs in 2003.” EPA, Greenhouse Gas Emissions from the U.S. Transportation Sector – 1990 -2003 (March 2006) at pages 5 and 21. Mathematically then, commercial aviation’s contribution to total U.S. GHG emissions in 2003 was 1.75 percent ((27 percent ¸ 9 percent ) ¸ 72 percent = 1.75 percent ). It is estimated that on a worldwide basis, commercial aviation accounts for approximately 3 percent of total GHGs, while at the same time contributing over 8 percent of the world’s economic activity. See, International Air Transport Association, “Debunking Some Persistent Myths about Air Transport and the Environment.”

³ EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2004 at ES-13.

⁴ United Nations, Livestock Environment and Development Initiative, Livestock’s Long Shadow – Environmental Issues and Options (2006) at 271.

⁵ The Campbell-Hill Aviation Group, “Commercial Aviation and the American Economy,” March 2006.

⁶ ATA analysis based on 2006 Revenue Passenger Mile (RPM) data submitted by carriers on DOT Form 41. See http://www.airlines.org/economics/energy.

⁷ For example, the new Boeing 787 Dreamliner, with a light-weight composite fuselage, boasts a 20 percent improvement in fuel efficiency over aircraft it will replace, including the 8 percent increase in fuel efficiency contributed by new GE and Rolls Royce engines.

⁸ Smart Skies is a national campaign led by the ATA airlines, which advocates modernization of the U.S. air traffic control system (ATC) and its funding mechanisms. For more on this initiative, see the Smart Skies Web site, at http://www.smartskies.org.

⁹ ICAO has established such standards for oxides of nitrogen (NO_x), carbon monoxide (CO), hydrocarbons (HC) and smoke. These standards, which have been made more stringent as technology has allowed, have been incorporated into U.S. law.

¹⁰ See, e.g., Memorandum of Understanding Between Transport Canada and the Air Transport Association of Canada (Nov. 15, 2004). The official announcement of this agreement by the Canadian government can be found at: http://www.tc.gc.ca/mediaroom/releases/nat/2004/04-h105e.htm.

¹¹ These figures are derived from “Analysis of Market-Based Options for the Reduction of CO₂ Emissions for, Aviation with the Aero Modeling System,” page A-3, Table A2 (November 2000) (prepared by ICAO’s Committee on Aviation Environmental Protection MBO Analysis Task Group, hereinafter “MATG Report”).

¹² ATA analysis based on 2006 Revenue Ton Miles (RTM) data submitted by carriers on DOT Form 41 and worldwide traffic reported by ICAO.

¹³ Id.

¹⁴ These figures are derived from ICAO’s MATG Report, at A-28 and A-30, Tables A21 and A23.

¹⁵ Id.

¹⁶ ICAO also has studied voluntary emissions trading as well as how international aviation emissions might be included in a country-specific or region-specific emissions trading scheme. As a result, in February of this year, ICAO’s Committee on Aviation Environmental Protection (CAEP) adopted a “Report on Voluntary Emissions Trading for Aviation” and “Guidance on the Use of Emissions Trading for Aviation.” These documents, which will be considered by the ICAO Council and ICAO Assembly in their upcoming meetings identify many of the considerations that should be taken into account if a country is considering emissions trading for aviation. While believing that inclusion of aviation in an emissions trading system is unnecessary and counterproductive, for the reasons cited above, should the United States. pursue such a course, the ICAO guidance should be taken into account.