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100 months

Environmental Questions the Review should ask

Speech given by Peter Ainsworth MP at the Greener By Design Conference
Royal Aeronautical Society, 4 Hamilton Place, London W1J 7BQ on Wednesday 2nd November 2005

Introduction

It was very kind of you to invite me to speak at this conference today. Very kind of you, and rather brave of me to come. I have to say that I feel somewhat like Daniel in the lion’s den. I have not always seen eye to eye with the aviation industry. And I do not know whether it is by accident or design that I have been scheduled to speak directly after Martin Capstick of the DfT – a department with which, as some of you may be aware, my Committee has had a series of "interesting” exchanges over the last few years.

But let me make it clear immediately that I welcome the thrust of all that you are doing to reduce the environmental impacts of air travel – whether that is in terms of technological advances in the design of engines and airframes, or in terms of air traffic management and operational improvements. There are clearly huge opportunities here for our world-class companies such as Rolls Royce, and we should not forget the positive impact on innovation and investment which stringent environmental standards in the UK and EU can have worldwide.

Yet the future is not going to be easy. I noted with interest the recent report from Greener by Design’s Science and Technology Sub-Group – Mitigating the Environmental Impact of Aviation: Opportunities and Priorities – published in July. Let me quote a lengthy but critically important section from the Executive Summary.

“Neither design nor operating measures which increase costs are likely to be adopted, however, until there is a regulatory framework or system of environmental charging in place which puts appropriate weight on reducing impacts other than CO2 emissions. It will be difficult to gain acceptance of any such framework without a more robust understanding than we currently have of the impact on climate of NOx, water vapour and of contrails and aviation-related cirrus. Equally, without this understanding, it is difficult to set priorities for research and forward-looking work in engineering design. For these reasons, the Sub-Group is firmly of the view that there is no higher environmental research priority than the effect of aviation emissions on the atmosphere and on climate. And, even with present uncertainty, the precautionary principle suggests that, in areas where the evidence is reasonably suggestive, we should investigate remedial opportunities rather than hang back waiting for proof positive.”

That passage from the Sub-Group’s report highlights a number of issues, but it is the last sentence which I find particularly important. In my view and that of the Committee which I chair, the likely impacts of climate change could prove to be so great that the precautionary principle becomes an overriding necessity – not an option to be traded for other objectives. You may indeed be uncertain as to the scale of the radiative forcing factor, but – while there is reasonable evidence that it may triple the global warming effect of aviation – we must factor it in to our policy making. And make no mistake, the risks of global warming are potentially cataclysmic, and recent research suggests that current models may have under-estimated its impact. It is a matter of extreme concern, for example, that the tipping point for the irreversible melting of the Greenland ice-shelf – only 1.5C in terms of a global temperature rise– is now well within the current forecasts for temperature increases this century.

Key issues raised by the Committee

Such concerns have underpinned the work on aviation which my Committee – the Environmental Audit Committee – has carried out since the beginning of 2003. And before going on to address directly the main subject of this talk – the questions the 2006 review should be asking – I think it would be useful for me to highlight a few key issues raised by the Committee in its series of reports. What I will not delve into here are the many other topics we have commented on – including, for example, our scepticism over attempts to place a financial value on the social cost of carbon (on which I notice you are due to have a session this afternoon); or our concerns on the likely local impacts of an increase in aviation – which are almost all entirely negative – in terms of noise, traffic, water resources, and air quality. Instead, I will focus on a few key issues which seem relevant here today.

Firstly, the extent to which the DfT is adopting a “Predict and Provide” approach. This term has of course become rather pejorative, redolent as it is of command economies. But the DfT has in fact provided a central forecast of growth – from 180 million passengers per annum in 2000 to 500 million by 2030 – and then has gone on provide the framework to meet practically all of it. If that is not a predict and provide approach, I don’t know what is. Indeed, the eagerness with which the Government is promoting growth is overtly demonstrated in the programme of action set out in the White Paper. I quote:

o “we expect the airport operator to move quickly to develop the detailed design for a new runway at Stansted and associated development…”

o we will institute immediately a programme of work on how to make the most of Heathrow’s existing runways and add a new runway after the Stansted runway…”

o “we expect all major airports to produce or update existing master plans, as appropriate, to take account of the conclusions in this White Paper.”

We concluded, naturally enough that the DfT had indeed adopted a predict and provide approach, and nothing the Department has subsequently said has convinced me otherwise.

The second key issue we raised was the accuracy of the DfT’s demand forecasts. We expressed concern on the assumptions underlying the Department’s proposals – namely that passenger numbers will increase by 4% every year for thirty years and that fares will decrease by up to 40% over the same period. We considered that the DfT should have promoted a far more extensive discussion of the underlying implications of such assumptions – in particular, more detailed behavioural analyses of who would actually be doing all this extra flying. We also expressed concern about the fact that the White Paper was based on an assumption that the price of oil would remain on average 25$ a barrel in real terms throughout the period. Even by June 2004, such an assumption looked wholly unrealistic, and this is a topic I will return to in a moment.

The third, and in some respects, the most dramatic, issue was the scale of the environmental impacts. We showed that – using the DfT’s own forecasts and including the Treasury’s figure for the effect of radiative forcing – that emissions from aviation would amount to over 44 million tonnes of carbon a year. To put that into perspective, the 60% carbon reduction target would require the UK to reduce all its current emissions from about 158 million tonnes to around 65 million tonnes by 2050. We concluded, and I quote: “If aviation emissions increase on the scale predicted by the DfT, the UK’s 60% carbon emission reduction target ….will become meaningless and unachievable. The most we could hope to attain would be about 35%. The DfT admitted that the target would need to be looked at should international emissions be allocated to national inventories – and this can only mean with a view to watering it down.” Since we made that statement, of course, we have had the Tyndall Centre report which reworked our calculations on a European basis and came to much the same conclusion.

The fourth key issue the Committee raised – and this is the last one I will mention – related to the failure of Government to develop an adequate policy for addressing the scale of these environmental impacts. We expressed concern that the White Paper contained no specific proposals apart from the commitment to incorporate aviation in Phase 2 of the EU Emissions Trading System from 2008; and we pointed out that that even that objective was unlikely to be achieved. Indeed, we were astonished at the lack of essential research – which the DfT itself accepted was necessary – to underpin the incorporation of aviation in the EU ETS. We also concluded, I quote: “It is inconceivable that any ETS could generate sufficient credits to allow aviation to expand as forecast, while at the same time delivering carbon reductions of the order needed. The price of carbon could, in such circumstances, go through the roof – provided there was sufficient political will to maintain targets and enforce penalties.”

After a series of exchanges, we agreed to differ. But our questions remain on the table, unanswered. And they are questions put not only by the EAC, but also by the Royal Commission on Environmental Pollution and the Sustainable Development Commission, as well as by numerous NGO’s. The DfT needs to know that denial is no substitute for debate if it wishes to avoid becoming a pariah department.

Questions the review should be asking

So much then for the key issues my Committee has raised. It seems to me essential that the Review must address them.

Firstly, the review must fundamentally reappraise the key assumptions made in the White Paper about future growth. There are a number of specific issues and sub-questions here. For example:

o What impact will the massive rise in oil prices have? The White Paper forecasts were based on the assumption that oil prices would remain at $25 a barrel until 2030. Yet we have seen them peak at nearly three times that amount during this last year, and there is little evidence to suggest they will ever fall again to such levels. How sensitive is the DfT’s modelling in this respect? Does the DfT consider oil prices will fall?

o Who is going to be doing this extra travelling? Apart from the most cursory analysis in terms of business and tourism, the DfT has admitted to us that little behavioural research has been carried out in this area. Currently, about half the population do not fly at all. Is the DfT expecting many of this group to begin flying, or are we talking about those who do currently fly flying far more frequently? I do find it extraordinary that so little has been done in this area. Ministers are fond of repeating the mantra that “we must not price people off planes”, as though cheap flights – a product of capitalism – represent a socialist virtue. Even if the research (which has not been done) were to prove that all the extra flyers were new, I am doubtful that knock-down prices could be regarded as a human right, particularly bearing in mind that the impacts of climate change are hitting the world’s poor earliest and hardest.

o Is the prediction in the White Paper that the price of air travel will fall in real terms by 40% over the next 25 years at all realistic? Will competition between low cost carriers continue to result in a fall in the real price of air transport of between 1 and 2 per cent a year? Will this business model continue, or will we see a gradual rationalisation of the market and the growth of a small number of large carriers?

Secondly, the review must reassess the scale of environmental impacts which are predicted, as almost all those impacts – noise, pollution, traffic etc – are negative.

o What are the latest environmental assessments, for example, of the impact of building additional runways at Heathrow, Stansted and Gatwick? Is it at all conceivable that EU requirements on NOx will be met? What about the position on water, where the Environment Agency expressed such serious concerns? What are the impacts on biodiversity, which concern the Woodland Trust, amongst others? Or on heritage, which so concern the National Trust?

Thirdly, it must examine what contribution technological and operational improvements can realistically make in terms of reducing these environmental impacts. In particular,

o To what extent are the rather optimistic technological and operational improvements already built into the DfT’s forecasts of carbon emissions actually achievable? Those forecasts assume, for example, that the ACARE targets are met. Yet even the recent report from the Greener by Design sub-group states that it will be very challenging to meet them. Can technology offer any more than a one to two percent improvement – as opposed to the 4 per cent increase in air traffic each year?

o Are there any dramatic step-changes in technology which may become available and could be introduced commercially in the next fifteen to twenty years? What are the chances, for example, of getting the blended wing body design up and running and making a difference in the short time that scientists tell us we’ve got before irreversible climate change clocks in? Are there any credible alternatives to aviation fuel?

Fourthly, the review needs to examine what policy instruments the UK Government should introduce, both domestically and within the EU, to address the yawning gap between these environmental impacts and the contribution technology can make. Again there are a clutch of issues here relating to the EU ETS and to the scope for introducing a variety of other economic instruments. For example,

o On what basis does the DfT consider international emissions should be allocated to national inventories? The Government has, as far as I know, never made its position clear on this.

o Can aviation be brought into the EU ETS? Can the full global warming impact– not simply its carbon emissions – be taken into account, as the Commission has indicated is a necessity? What alternatives are there in terms of charges or taxes? I know that the Commission has now set up a working party to examine these issues. The review will certainly need to take account of its findings, but it will also need to develop contingency measures if progress appears unlikely.

o What are the cross-sectoral implications of incorporating aviation within the EU Emissions Trading System? How will other UK industrial sectors react when they themselves are facing stringent caps, while aviation is allowed to grow?

o What action can the UK take unilaterally? Almost all other EU member states charge VAT on ticket sales, for example. Some have introduced their own emissions charging systems. Why has the UK done so little in this respect?

Conclusion

As you will see from that list of questions, I would like to have confidence that this review will be strategic, as what is really need is a fundamental reassessment of the case set out in the Aviation White Paper. That is indeed what the Government are now doing in the case of energy, where a fundamental review is also scheduled for next year - only some 3 years after the Energy White Paper was published.

My fear is that the Government will not have the courage to carry out such a reassessment, that the review will become simply an assessment of detailed progress against the action programme outlined in the White Paper, and that the DfT will push on with implementing the White Paper regardless. What the DfT has so far not recognised is that we may be on the threshold of a paradigm shift in terms of the development of aviation. This has happened before in other areas, and provides a salutary reminder of how such a shift can destroy departmental planning. To take energy once again as an example, in the 1970s, the Government was forecasting that the demand for electricity generating capacity would grow at 7% per annum – as it had done for the previous 30 years. On that basis, it developed plans for a massive expansion in a new generation of nuclear power stations and the maintenance of a large coal industry. In reality, for a variety of reasons, 1979 proved to be a turning point: previous Government forecasts proved to be wildly wrong, and – of the 10 nuclear power stations envisaged – only Sizewell B was eventually built.

Indeed, in the energy sector now, we see more clearly than ever before that it is for Government to define the framework and the long-term objectives which determine the market, rather than actively to participate within it. The same is likely to be true of aviation. And just as, within energy, whole new commercial horizons are opening up within a carbon constrained future, so too must the DfT press on with developing economic instruments in order to create the financial incentives necessary to develop and deploy all these technological improvements which you are discussing here today.

I represent a constituency near Gatwick. I like to think that I have a civilised relationship with BAA; I like to think that they would say the same.

I recognise the economic significance of aviation. I represent thousands of people who work in the industry and related sectors. And I represent many thousands more who fly regularly. I also represent an area where sleep, health, peace of mind and rural tranquillity are being wrecked by aeroplanes. I think that I can claim some knowledge of the issues that you are wrestling with; and I am glad that you are wrestling with them.

I cannot say that I represent the planet, though I can say that we all have homes to go back to, all have families; most of us will have children or grandchildren. What will we say to them if we fail to avert catastrophic climate change? What will you say, if aviation fails to shoulder its responsibilities?

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