United States: EPA's Proposed Endangerment Finding For Aircraft Greenhouse Gas Emissions Opens Door To Additional Industry Regulation

On June 10, 2015, the United States Environmental Protection Agency ("EPA") proposed an endangerment finding that it calls "a preliminary but necessary first step to begin to address GHG emissions from the aviation sector" under the Clean Air Act ("CAA").1 EPA also issued an Advance Notice of Proposed Rulemaking ("ANPR"), proposing domestic adoption of the forthcoming International Civil Aviation Organization ("ICAO") rules, which are expected in February 2016. The proposed finding that greenhouse gas ("GHG") emissions from certain classes of aircraft engines contribute to climate change and endanger public health and welfare is in response to a citizen petition and exempts military and smaller aircraft, including most private aircraft. It is not clear from the finding whether EPA is seeking to regulate only domestic operators or whether it will also attempt to regulate international parties operating in the United States. While the Obama administration likely will not have time to promulgate regulations before leaving office, once EPA finalizes the endangerment finding, the CAA requires the new administration's EPA to issue standards of some kind regulating aircraft emissions from the identified classes of engines.

Path to Rulemaking

Before EPA can issue regulations under the CAA, the Administrator must make two preliminary determinations: first, she must find that GHGs endanger public health and welfare, and second, she must find that aircraft emissions cause or contribute to GHGs. The proposed aircraft endangerment finding relies on two recent GHG endangerment findings regarding automobiles2 and power plants3 from 2009 and 2014 respectively. In particular, the aircraft finding relies on the definition of "air pollution" taken from the 2009 automobile endangerment finding to support the determination that GHGs generally endanger human health and welfare. The automobile finding's analysis of health and welfare has been upheld in the face of repeated challenges, including by the U.S. Supreme Court in Massachusetts v. EPA.4

As for the second finding—that aviation causes or contributes to this danger—EPA cites data indicating that aviation is responsible for 3 percent of total GHGs in the United States and 11 percent of GHGs from the transportation sector. While the endangerment finding figures demonstrate that aviation is the largest unregulated source of GHGs in the transportation sector, they also indicate that in 2013, aircraft emitted less than one-seventh the amount of GHG emissions from automobiles, which constituted 23 percent of overall United States GHG emissions. According to data on EPA's website,5 power plants are responsible for more than 13 times the amount of carbon dioxide emissions as the aviation industry, as they make up 40 percent of total United States carbon dioxide emissions. Thus, the proposed aviation finding represents a continuing commitment by the agency to seek regulatory control over GHG emissions from diverse industries.

Rulemaking Process

Assuming the endangerment finding is finalized, which EPA anticipates will happen in 2016, the agency will begin the rulemaking process—including mandated time for public comment—before any standards are put in place. While a new presidential administration will likely be responsible for adopting the ultimate rule and may seek significant changes to the Obama administration's proposals, it is certain that there will be regulation of some kind. In Massachusetts v. EPA, the Supreme Court held that if EPA makes an endangerment finding, "the Clean Air Act requires the Agency to regulate emissions" regardless of competing policies, and that "[t]o the extent that this constrains agency discretion to pursue other priorities of the Administrator or the President, this is congressional design."6 Thus, a finalized endangerment finding will obligate the successor administration to promulgate aircraft emission standards in some form.

The ANPR does not include projected compliance costs to the industry. In crafting its regulation, EPA has the authority to consider such factors as cost. Sierra Club v. Costle, 657 F.2d 298 (D.C. Cir. 1981). Indeed, the ANPR specifically calls for comment on cost-effectiveness analysis and cites ICAO criteria of technical feasibility, environmental benefit, cost-effectiveness, and impacts of interdependencies.7 Recently, in Michigan v. EPA,8 the Supreme Court held that EPA must consider compliance costs at the first stage of the agency's regulatory analysis when regulating hazardous air pollutant emissions from power facilities under 42 U.S.C. § 7412. Because the proposed aviation endangerment finding is promulgated under 42 U.S.C. § 7571, within a separate title of the Clean Air Act, the case does not directly apply to the aircraft endangerment finding and subsequent emission standards. Nevertheless, while not directly applicable, the recent decision indicates that consideration of costs may be an inherent requirement in EPA's analysis for promulgating emission standards under the CAA.

In fact, EPA has considered costs in its previous GHG emissions regulations. Following its 2009 automobile endangerment finding, EPA considered cost-effectiveness and technological feasibility when promulgating its final rules for light automobiles in 20109 and again when it updated its light automobile standards in 2012.10 Specifically, the 2010 rule projected industry costs of $51.8 billion for model years 2012 through 2016. The 2012 rule projected costs of $150 billion for model years 2017 through 2025. EPA is also considering cost-effectiveness in its hotly contested proposed power plant regulation, the Clean Power Plan,11 which has been criticized as entailing exorbitant or unreasonable costs compared to its benefits. Yearly cost estimates for implementing the Clean Power Plan range from $5.5 billion in 2020 to $8.8 billion in 2030.

Scope of the Proposed Rulemaking and Support for International Regulation

The endangerment finding and ANPR do not specify whether EPA plans to apply any forthcoming standards only to domestic commercial aircraft or to both domestic and international operators. Any attempt by EPA to regulate international providers would likely meet some backlash, as did the European Union's attempts to implement emission reductions via the Emissions Trading System ("EU ETS").12

The EU ETS places a cap on the amount of carbon emission allowances available each year to regulated industries, but individual firms within the regulated industries can trade these allowances to allow companies to choose the most cost-effective options to address their emissions.13 Under the original EU ETS framework, any flight landing or taking off from EU jurisdictional airspace would be subject to the EU ETS for the entire flight, regardless of the portion of the flight that occurred outside of the jurisdictional airspace. The EU's initial scheme to apply the ETS scheme to international airlines was eventually modified in the face of concerted diplomatic opposition by the United States, China, India, and Russia. These countries, among others, opposed EU ETS on the grounds that Europe did not have jurisdiction to tax international airlines operating outside of EU airspace.14 Ultimately, the EU modified the original scheme in the face of mounting pressure such as legislation by the challenging countries that would ban their domestic airlines from participating. In the United States, President Obama signed such a bill into law on November 27, 2012.15

For more than four years, EPA and the Federal Aviation Administration ("FAA") have cooperated with ICAO's efforts to develop uniform international standards, "which the EPA could then consider proposing for adoption under its section 231 authority of the CAA." The ANPR expressly states EPA's "continued support" of an international carbon dioxide emissions standard expected to be released by ICAO in February 2016. The ANPR further recognizes that "[h]istorically ... international emission standards have first been adopted by ICAO, and subsequently the EPA has initiated rulemakings under CAA section 231 to establish domestic standards equivalent to ICAO's standards where appropriate." While EPA recognizes that it does not operate in a vacuum in regulating aircraft emissions, and the ANPR takes pains to express EPA's support of ICAO, the ANPR also notes that ICAO member states "may adopt their own unique standards that are more stringent than ICAO standards" and requests comment on the potential adoption of stricter regulations.16

There has been concern that ICAO will not be able to meet its February 2016 deadline. In the long term, ICAO predicts that improved technology will be sufficient to reduce carbon emissions, but it has recognized that market-based measures are necessary in the interim.17 These market-based measures have proven controversial, particularly because ICAO must address disparities between its developing and developed member states. One proposal is a de minimis exception for routes to and from developing states whose share of international aviation revenue ton kilometers is less than 1 percent.18 The United States objected to this proposal, calling for the exception to be based on the aviation activities of states, rather than airline routes, on the grounds that the proposed standard would exempt a majority of countries from a global market-based measure and distort the market.19 Further complicating the issue, Brazil, Russia, India, and China ("BRIC nations"), which would not fall into the de minimis exemption, have called for leniency on the grounds that even-handed measures across the board will allow developed nations to "preserve their leading positions in the industry."20 BRIC nations instead called for common but differentiated responsibilities, through which developed countries would offset the carbon emissions of the developing world.21 These proposals resulted in the establishment of the Environmental Advisory Group, made up primarily of developing nations, to oversee the development of market-based measures.

There has been industry concern that, because EPA must act on a finalized endangerment finding, if ICAO fails to meet its February 2016 deadline, EPA will be forced to promulgate its own rules. This would result in precisely the piecemeal regulation ICAO's international efforts seek to avoid.22

Industry Initiatives

The aviation industry has been proactive in reducing carbon emissions. The International Air Transport Association ("IATA"), the world's largest aviation trade group, has set goals to stabilize net carbon dioxide emissions by 2020 and halve carbon dioxide emissions by 2050.23 To accomplish this goal, IATA calls for a commitment from all industry stakeholders in pursuit of its "four pillars of the aviation industry strategy": improved technology, more efficient aircraft operations, infrastructure improvements, and interim market-based measures. Like ICAO, in the long term, IATA seeks to drive emissions reduction through technology, but it does support interim market-based measures, provided these measures are global in nature.24

In the area of technology, IATA believes that aviation biofuels can reduce carbon dioxide emissions by up to 80 percent over their full lifecycle.25 While the first commercial biofuel flights were achieved in 2011, the development of aviation biofuels has faced challenges with building financial infrastructure and coordinating with the agricultural industry without displacing other agricultural needs.26 On July 8, 2015, Boeing and a collection of Japanese aviation industry stakeholders unveiled an initiative that seeks to develop sustainable biofuels for use by commercial airlines in time for the 2020 Tokyo Summer Olympics.27

In the area of operations efficiency, Boeing, Alaska Airlines, the Port of Seattle, and FAA have worked together on the Greener Skies over Seattle program to reduce emissions by improving flight protocols, with the goal of using these protocols as a template for improving efficiency across the United States.28 Under the program, satellite-based navigation arrival procedures allow airplanes landing in Seattle to go from cruising altitude to landing with a continuous descent, rather than the traditional stair-step pattern. Boeing recently reported that the project produced emission reductions of one metric ton per flight—28 percent greater than 2010 predictions—and Alaska Airlines estimates that the procedures save about $200 in fuel per flight while reducing flight time.29

Next Steps

In its call for input, EPA is taking comment on when carbon standards should take effect, how stringent they should be, and whether standards should apply only to newly designed aircraft or to designs already in production. Comments are due by August 31, 2015 at 11:59 p.m., EST. A public hearing will be held in Washington, D.C. on August 11, 2015.

Footnotes

[1]Proposed Finding That Greenhouse Gas Emissions From Aircraft Cause or Contribute to Air Pollution That May Reasonably Be Anticipated To Endanger Public Health and Welfare and Advance Notice of Proposed Rulemaking, 80 Fed. Reg. 37,758 (July 1, 2015) (to be codified at 40 Cfr. Pts. 87, 1068).

[2] Endangerment and Cause or Contribute Findings for Greenhouse Gases Under Section 202(a) of the Clean Air Act; Final Rule, 74 Fed. Reg. 66,496 (Dec. 15, 2009).

[3] Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generating Units, 79 Fed. Reg. 34,830 (June 18, 2014) (to be codified at 40 CFR pt. 60).

[4] 549 U.S. 497 (2007).

[5] "Air Emissions," EPA Clean Energy.

[6] 549 U.S. at 533.

[7] CAEP (Working Paper), "U.S. Position on the Development of ICAO'S Aircraft CO2 Standard," CAEP-SG/20112-WP/25, Presented by the United States, U.S. Working Paper for CAEP Steering Group meeting, Beijing, China, September 12–16, 2011.

[8] 576 U.S. _____ (June 29, 2015).

[9] Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards: Final Rule, 75 Fed. Reg. 25,324 (May 7, 2010), http://www.gpo.gov/fdsys/pkg/FR-2010-05-07/pdf/2010-8159.pdf

[10] Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards: Final Rule, 75 Fed. Reg. 62,624 (Oct. 15, 2012).

[11] Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generating Units, 79 Fed. Reg. 34,830 (June 18, 2014) (to be codified at 40 CFR pt. 60).

[12] James Kanter & Nicola Clark, "Countries Seek Retaliation to Europe's Carbon Tax on Airlines," The New York Times, Feb. 17, 2012.

[13]European Union Publications Office, The EU Emissions Trading System (EU ETS), (2013).

[14] "European Commission Backs Down on EU ETS and Agrees to 'Stop the Clock' on International Aviation Emissions," Clean Air Online, Nov. 12, 2012.

[15] European Union Emissions Trading Scheme Prohibition Act of 2011, Pub. L. No. 112-200, 126 Stat. 1477

[16] Proposed Finding That Greenhouse Gas Emissions From Aircraft Cause or Contribute to Air Pollution That May Reasonably Be Anticipated To Endanger Public Health and Welfare and Advance Notice of Proposed Rulemaking, 80 Fed. Reg. 37,758 (July 1, 2015) (to be codified at 40 Cfr. Pts. 87, 1068).

[17] ICAO, Market-Based Measures.

[18] CAEP (Working Paper), "International Aviation and Climate Change: De Minimis Provisions," CAEP-A37—WP/316,

[19] "Count Us Out of Carbon-Neutral Growth Measures, China and Other Major Emerging Countries Tell ICAO," Green Air Online, Nov. 4, 2013.

[20] Victoria Bryan, "Airlines Grapple with Rich, Poor Divide in Global Emissions Scheme," Reuters, June 9, 2015.

[21] "Proposal by BRIC States to Set up a New Group on a Global MBM for Aviation Approved by ICAO Counsel," Green Air Online, Dec. 20, 2013.

[22] Aaron Karp, "Editorial, Putting Pressure on ICAO," Air Transport World.

[23] IATA, "Responsibly Addressing Climate Change" (June 2013).

[24] Press Release, IATA, "Aviation Needs a Global Agreement on Market-Based Measures" (Feb. 26, 2013).

[25] IATA, "Alternative Fuels."

[26] IATA, "Biofuels in Aviation: The Dilemma," (December 2, 2014).

[27] Press Release, Boeing, "Boeing, Japanese Aviation Industry Unveil Biofuel 'Roadmap' to 2020 Olympics" (July 8, 2015).

[28] "Greener Skies over Seattle = Greener Skies Over the USA," FAA, (June 2012).

[29] "Boeing Procedures Help Alaska Airline Improve Efficiency, Cut Fuel Consumption," Environmental Leader, July 6, 2015.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Charles T. Wehland
Jennifer M. Hayes
Rebecca MacPherson
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Emails

From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.