Ryanair to cover carbon scheme at 0.25 euro per seat

DUBLIN Mon Jan 9, 2012 12:15pm EST

Michael O'Leary, chief executive of Irish low-fare airline Ryanair, speaks during a news conference in Brussels November 24, 2011.  REUTERS/Yves Herman

Michael O'Leary, chief executive of Irish low-fare airline Ryanair, speaks during a news conference in Brussels November 24, 2011.

Credit: Reuters/Yves Herman

DUBLIN (Reuters) - Ryanair (RYA.I) will introduce a 25 euro cents levy on every seat booked from next week to cover the expected 18-20 million euro cost for carbon permits it needs this year under a new European Union emissions trading scheme.

Europe's largest budget airline on Monday followed U.S. group Delta Air Lines (DAL.N) and Deutsche Lufthansa (LHAG.DE), Germany's biggest carrier, in passing costs onto customers.

"We do not agree with it and we do not believe there will be any environmental benefit," a Ryanair spokesman told Reuters.

Under plans to tackle climate change, airlines touching down or taking off in the 27-nation European Union and three neighbouring nations must account for their CO2 emissions as part of an expansion of the world's largest carbon market.

Airlines and their associations have balked at the scheme and even challenged it in court, saying it further burdened an industry saddled with soaring fuel prices, fierce competition and national taxes.

Global airlines group IATA has estimated the annual industry-wide cost of the ETS will rise to 2.8 billion euros by 2020 from 900 million this year.

Europe's highest court last month backed the scheme, meaning all airlines will have to pay for emissions permits, drawing anger from the United States and China.

(Reporting by Conor Humphries; Editing by Padraic Halpin and Dan Lalor)

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