LONDON Aug 27 Britain will hand its airlines
6.6 million free carbon allowances a year to help reduce the
cost of meeting their obligations under Europe's Emissions
Trading Scheme (ETS) from 2013-2016, the government said on
The European Union's ETS caps the emissions of over 12,000
power plants, factories and airlines, requiring them to
surrender one carbon permit for every tonne of CO2 emitted
annually by April of the following year.
The allocation announcement will help the airlines plan how
they will meet their obligations after several years of
uncertainty over how the aviation sector would be treated.
Under the ETS, industrial manufacturers and airlines get
free carbon allowances (EUAAs) each year to help them compete
with rivals in other countries that have looser environmental
EasyJet is the largest recipient of free credits,
with an allocation of 2.9 million allowances every year during
the four year period, according to the data issued by Britain's
Department for Energy and Climate Change.
British Airways, owned by International Airlines Group
, will receive 1.3 million a year and Thomson Airways
will receive 738,736 EU aviation allowances (EUAAs), the data
As one of the EU's main air transport hubs, Britain has the
most airlines to regulate under the scheme of all the 28 member
The annual allocation has been cut by around a third after
EU lawmakers agreed to restrict the ETS to flights within the
EU, following pressure from some of its major trading partners
such as the United States and China, which argued that it
infringed upon their sovereignty.
EUAAs can only be used by airlines for compliance, which
means they trade at a discount to the more liquid EU Allowances
(EUAs), the staple EU carbon currency that can be used by power
plants and factories under the scheme.
Benchmark EUAs currently trade around 6.30 euros per tonne
(Reporting by Susanna Twidale; Editing by Mark Potter)