Sustainability and Environment
The Latest On The EU ETS
The intention may have been good with EU ETS but gradually it has become clear that only a global scheme will work.

Although the intentions were good, in reality rolling out the EU emissions trading system (EU ETS)–considered a cornerstone of the European Union’s policy to combat climate change and the key tool for reducing industrial greenhouse gas emissions in a cost-effective manner–to international aviation has backfired spectacularly.

ETS operates as a “cap-and-trade” plan in which it allocates a total amount of certain greenhouse gases that can be admitted by a particular sector–with the cap being gradually reduced over time so as to lower total emissions. Under this cap, companies can receive or buy emission allowances that they can trade with each another. At the close of a year, a company must surrender enough allowances to cover all its emissions. Failure to do so subjects them to hefty fines.