FAA Outlines the Environmental Risks to the Aviation Industry
The United States Federal Aviation Administration (“FAA”) recently released its Aerospace Forecast for Fiscal Years 2012-2032. In the Forecast, FAA identified several risks to the aviation industry, including aviation’s impact on the environment and the uncertainty surrounding the European Union’s Emissions Trading Scheme (“EU ETS”).
Aviation sector operations are expected to grow to meet expanding national economic and mobility needs. With this growth comes increased noise pollution, air quality, and water quality concerns, especially around new construction and expansion of existing airports. Global carbon emissions from the fleet are also expected to rise, unless mitigated by new cleaner aircraft technologies, renewable fuels, operational improvements, and market based measures. If the aviation industry does not address these issues and make significant progress, tighter restrictions via environmental standards and operating limitations will be imposed, thus potentially depressing industry growth.
The report also notes that the effects of market based measures, such as the EU ETS, are unpredictable. Implementation of the EU ETS has the potential to increase costs for U.S. airlines, which in turn, could reduce the funds available for investments in new emissions reduction technology. However, the reverse could also be true. In the face of increased operating costs, U.S. airlines could hasten the development of more fuel efficient technologies. Most likely, U.S. airlines will face a short-term increase in operating costs that will soon be reduced through the adoption of cleaner technologies and fuels. Such an outcome would only be hastened by the uncertainty and recent increase in oil prices.
