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Switzerland plans to connect Swiss and EU emissions trading schemes

Switzerland harbors plans to add aviation to its current emissions trading scheme (ETS) and to connect the Swiss and EU ETS.

The purpose of this move is to allow the two to acknowledge each other’s emission allowances through a bilateral agreement that was inked last month.

The proposal however, still needs to be approved by both the EU and Swiss Parliaments. Should it be ratified, the agreement would be implemented the year after.

The Ordinance on the Acquisition and Reporting of Ton-Kilometer Data Relating to Distances Covered by Aircraft was applied in July. The ordinance was created to match the cap-and-trade standard of the EU ETS.

The ordinance covers domestic flights and flights between Switzerland and the European Economic Area (EEA) only, in congruence with the EU’s stop-the-clock decision.

Particular provisions regulate Basel-Mulhouse airport, which can be found on French soil but operated by both Switzerland and France. The ordinance is not applicable to flights to and from third countries.

Aircraft operators are mandated to supervise and report emissions and give up allowances against those emissions. Operators are given tradable allowances covering a specific level of emissions from their flights every year.

The ordinance mandates operators to forward a monitoring strategy to the Swiss Federal Office for the Environment and gather ton-kilometer data in 2018.

An estimated 120 operators are impacted by the Swiss ETS, the lot of which is already in the EU ETS. But for some operators, the procedure is considered novel.

When the link between the EU and the Swiss ETS is functional, rates for emission allowances would coincide.

It is imperative that the entire aviation industry plays a significant part in fighting climate change. However, the addition of global aviation in the Swiss and EU ETS poses problems.

Since a lot of carriers serve all across the globe, they should be regulated by a single market-based standard to tackle carbon dioxide emissions. Having just one measure would simplify things and mitigate the risk of market misrepresentations that could stem from such a hodge-podge of both national and regional regulations.

The 191 countries that comprise the International Civil Aviation Organization, which include Switzerland, accepted a worldwide carbon offsetting scheme for international aviation or CORSIA in October 2016.

Under this scheme, operators must buy offsets for the rise in total emissions from civil aviation above 2020 levels. The execution of CORSIA from January 1, 2021 would preclude the need the application of both the Swiss and EU ETS to global aviation emissions.

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