There is a great deal to be made and lost from trading in carbon credits and as the price of the same is so very low many EU-based airlines have been stocking up for the future. Even so the US Senate has unanimously passed the Thune bill on Saturday allowing the transportation secretary to force US airlines to not participate in the EU Emissions Trading Scheme (EU ETS). The bill had some amendments added allowing some of its effects to be nullified if the EU changes its scheme to an acceptable format or if the ICAO takes some related action, or if the United States issues a related rule or law on aircraft emissions.
But of course the ICAO has yet to come up with a valid plan for anything that could pass as a global ETS.
This leaves airlines in a certain amount of limbo. No one I have spoken to has a clue of what the future holds with regard to ETS. It’s impossible to predict whether the EU will conduct a U-Turn before the end of the year although there are many advocates that say the EU will refuse to back down. What we do know is that the EU ETS was supposed to be a lead that the world followed, where carbon trading zones would have sprung-up across the globe helping the aviation community meet its Kyoto obligations by 2020. Where it goes from here is still being debated with the anti-ETS lobby continuing to spout scarce stories of a world trade war should the EU refuse to yield to their demands.
Meanwhile, Cathay Pacific Airways has recorded its most profitable week of the year so far last week thanks to strong demand for premium services on long-haul routes after months of weak demand.
However regional routes including those to the Philippines look very weak as load factors fall away and it is here that Cathay must act soon. Cathay has no plans to cancel any Hong Kong-Japan flights but reports have confirmed some booking cancellations have taken place on flights to Japan.
Demand for air travel between Japan and China continues to weaken as we approach what is usually a peak period for that sector.
Yesterday, Hainan Airlines, China's fourth-largest airline by capacity, said it had suspended its twice weekly flights between Beijing and Okinawa because of insufficient demand.
ETS – Does anyone know what to plan for?
