Late last year, the Aviation Working Group—comprising representatives from airplane and engine manufacturers, leasing companies, and financiers—unanimously supported creation of a subgroup focused on the impact of environmental regulation on aircraft financing.

Scott Scherer Vice President Boeing Capital Corporation

Chartered to study regulatory approaches that preserve the economic benefits of commercial aviation, the group’s first action was a detailed response to the European Union proposal to bring aviation into the EU Emissions Trading Scheme. The response affirms that global climate change demands global solutions—not conflicting regional efforts that would impede commerce and impose local fees or penalties without providing measurable environmental benefits.

Regulation based on disparate regional requirements would add complexity and volatility to airline businesses and increase uncertainty about aircraft values. The resultant increase in financial risk would raise costs for all stakeholders.

The group favors a global, multilateral aviation emissions management scheme. The ICAO Committee on Environmental Protection is the global organization chartered to address worldwide aviation environmental regulation. The AWG is seeking ICAO observer status to represent aircraft financiers in issues pertaining to environmental regulation of the aviation industry.

Specific policy mechanisms for addressing international aviation emissions remain to be determined. The AWG subgroup is committed to working with governments and policy makers to identify and promote reasonable environmental regulation that takes into account the efficiencies of modern aircraft and global aircraft financing infrastructure to achieve worldwide environmental goals for aviation.

Over the last 40 years, the aviation industry has improved environmental performance by 70% in terms of CO2 emissions and 90% in terms of noise footprint. That is a record that no other transport industry can approach. Aviation is now coming together, through groups like the AWG and ICAO, to forge guidelines and standards that produce significant environmental performance improvements for us and future generations.