A4A Oral Testimony of Nancy Young, VP for Environmental Affairs Before the Senate Committee on Commerce, Sciences and Transportation

Commercial aviation helps drive more than 10M American jobs and 5 cents of every dollar of U.S. GDP
Commercial aviation drives more than $1 trillion per year in economic activity
In 2012, U.S. airlines moved more than 48,000 tons of cargo per day
In 2012, the value of a kilogram of U.S. merchandise exported by air averaged 121 times the value exported by sea
For every 100 airline jobs, some 360 are supported outside of the airline industry
Federal taxes constitute $61 – or 20% – of the price of a typical $300 domestic round-trip ticket
In 2011, U.S. airlines carried 16 percent more passengers and cargo using 10 percent less fuel than in 2000
Domestically, airlines drive 5% of economic activity but account for 2% of man-made GHG emissions
From 2000-2011, airlines reduced GHG emissions by 11% while transporting 16% more passengers and cargo
From 1975-2011, U.S. airlines and their partners reduced significant noise exposure by 99%
Commercial air travel is the safest form of intercity transportation in the United States
In the most recent decade, scheduled air service on U.S. airlines was seven times safer than in the 1970s
From 2000-2012, U.S. airlines improved the on-time arrival rate from 72.6% to 81.9%
From 2000-2012, U.S. airlines reduced the flight cancellation rate sharply from 3.30% to 1.29%
Airfares are a bargain: From 2000-2012, U.S. CPI rose 33% while average domestic fare rose just 14%
Adjusted for inflation, the average round-trip domestic airfare fell 15% from 2000
2007 domestic flight delays cost the United States approximately $31 billion
In 2012, the value of U.S. merchandise exported by air reached an all-time high of $427B
In 2012, U.S. exports of air-travel services reached an all-time high of $39.5B, driving a $5.1B trade surplus
In 2012, U.S. passenger and cargo airlines spent more than $50B on fuel, averaging 36% of operating expenses
In 2012, U.S. airlines posted the lowest annual rate of mishandled baggage ever recorded
FAA projects U.S. air travel demand to top 1 billion passengers in 2027
In 2012, US airlines flew 83.4 million passengers in scheduled international service - a record high
In 2012, the total value of merchandise exported from or imported to the United States by air exceeded $927 billion
In 2012, 7.15 teragrams of merchandise was exported from or imported to the United States by air

	A4A Oral Testimony of Nancy Young, VP for Environmental Affairs Before the Senate Committee on Commerce, Sciences and Transportation
	PubZone1 June 6, 2012 The European Union’s Emissions Trading System Thank you for the opportunity to testify regarding the unilateral and extraterritorial European Emissions Trading Scheme – a scheme that poses a threat to our nation’s airlines, exports and economy, and also to advancing the right kind of measures to further address aviation greenhouse gas emissions. My name is Nancy Young. I am Vice President of Environmental Affairs for Airlines for America (A4A), representing major passenger and cargo airlines of the United States. A4A is joined in our opposition to the EU scheme by an extensive and bipartisan constituency in the United States and around the world. And we are appreciative that the U.S. Congress has also expressed opposition to the scheme in the recently approved FAA reauthorization legislation. This deep and abiding opposition is warranted. Since 2009, the scheme has required U.S. airlines to monitor and report to the EU their emissions for all flights to and from the EU, over the entirety of each flight. But beginning on January 1 of this year, the burden on U.S. airlines increased exponentially. Since then, U.S. airlines have been obligated to acquire special “allowances” covering the emissions over the whole of each flight. Consider the example of an actual A4A member flight from San Francisco to London. Once the aircraft engine is engaged, the EU emissions rules apply. As a percentage of total emissions, 29 percent take place in U.S. airspace; 37 percent in Canadian airspace; and 25 percent over the high seas. Less than 9 percent of the emissions take place in EU airspace. The imposition of this unilateral cap-tax-and-trade scheme on U.S. citizens and U.S. companies is a clear violation of our nation’s sovereignty and the treaties governing international aviation and commerce. The EU tries to argue that if the United States just adopts “equivalent measures,” the EU will exempt our airlines on one leg of the flight. That our government should take orders from the EU on how to fashion U.S. law is an astonishing proposition. Moreover, it is a recipe for chaos. While significant, this dispute is not really about the amount of the exorbitant tax – $3.1 billion – that U.S. airlines and consumers will have to pay into European coffers through 2020. It is about the implications of the EU jurisdictional grab over worldwide aviation. Simply put, if the EU can tax the emissions over the entirety of a flight merely because it touches down in Europe, what is to keep the EU from imposing greenhouse gas (GHG) import taxes on U.S. autos, pharmaceuticals, chemicals and other goods? And on what basis will the United States stand up against other countries that seek to do the same? Unfortunately, the EU has thumbed its nose at diplomacy, just as it did when it adopted an illegal ban on aircraft fitted with “hushkit” technology in the early 2000s. As the United States did then, so must it now take concrete legal action to overturn the application of the ETS to U.S. airlines. Make no mistake. The EU ETS is not about the environment. It is about a new source of revenue for a cash-strapped Europe. Indeed, none of the monies collected are required to be used for environmental purposes. By contrast, the initiatives the U.S. airlines are undertaking are resulting in real environmental improvements. By investing billions of dollars in fuel-saving aircraft and engines, innovative technologies and advanced avionics, the U.S. airline industry improved its fuel efficiency by 120 percent between 1978 and 2011, resulting in emissions savings equivalent to taking 22 million cars off the road each of those years. That’s why our industry represents just 2 percent of all U.S. GHG emissions while driving over 5 percent of the nation’s GDP. And we are not stopping there. A4A and its members are part of a worldwide aviation coalition with an aggressive proposal for further carbon-emissions reductions under the appropriate international body –ICAO. ICAO has put many of the elements of a global framework in place. In fact, consistent with that framework, the U.S. government is poised to join other countries in filing “Action Plans” on aviation and climate change later this month. Further, ICAO is developing a CO2 standard for aircraft and undertaking work on potential market-based measures, work that is slated to be completed in 2013. Ironically, the EU ETS has been a roadblock to finalizing the full agreement at ICAO. Urgent, concrete action by the United States is needed to overturn the application of the EU ETS to U.S. airlines and to bring the EU back to the table in support of a global framework. As it has done before, the United States, in its role as a world leader, must wield the tools it has to remove the wrong measure in favor of the right one. This should include the filing of a legal challenge to the EU ETS under Article 84 of the Chicago Convention. We thank Senators Thune and McCaskill for their leadership in sponsoring S. 1956, the “European Union Emissions Trading Scheme Prohibition Act,” and we urge the Senate to approve this legislation. This will convey to the EU the seriousness of the Senate’s concerns about the unilateral EU actions and their effect on U.S. airlines, consumers, exports and our economy. Moreover, it will spur the administration to go beyond diplomatic talk to concrete action and will serve as a critical catalyst for finalizing a global agreement at ICAO. Thank you for the opportunity to testify. PubZone2	A4A advocates measures to support aviation safety, security and well-being.