Leading article: Airlines must pay the real cost of their emissions

That the airlines by and large welcomed yesterday's European Commission proposals on carbon emissions tells us almost as much as we need to know. The Commission has produced a pusillanimous set of measures; they represent the lowest common EU denominator and will do next to nothing to curb emissions. Confronted with a choice between a quiet life and making a positive contribution to the future well-being of the planet, it is not hard to guess which way the Commission jumped.

It is not quite the worst of every possible world. The worst would have been for the Commission to abdicate all responsibility. But the plan comes pretty close to this. The Commission's central proposal is that airlines operating in the European Union should pay only for any increase in CO2 emissions that exceeds present levels. All internal EU flights would be incorporated into the existing Emissions Trading Scheme by 2011, with all other flights required to join the following year.

The system would work like this: every airline would be allocated an allowance based on its average level of emissions between 2004 and 2006. They would be able to sell any permits they did not use, while having to buy additional permits from other members of the trading scheme to cover any increase in emissions. The thinking is that this would encourage airlines to reduce, or at least not to increase their emissions, at a time when the number of passengers and flights is forecast to rise exponentially.

The disappointment is not just that the proposals are so timid, but that the opportunity existed to do so much more. There is, for instance, no transatlantic angle. This may be understandable in the short term, given the US refusal to countenance any joint effort, but the Commission seems to have given up even on the longer-term prospect of any wider deal.

And why has it settled for "free" emissions allocations at the current level? There was a chance here not just to discourage any increase, but actively to encourage a reduction. Permits could have been paid for, or - better - auctioned. The chosen option offers little incentive for the airlines seriously to change their ways.

This presupposes that carbon trading is an effective way of cutting CO2 emissions anyway - something of which we remain unconvinced. The trouble with trading schemes is that they allow the rich to persist in their profligate ways, while piling the pressure on the poor and those least well-equipped to change. It should be no mystery why profitable airlines prefer this option, too: it requires less effort on their part than any other. With aviation - one of the heaviest carbon polluters - anticipating another period of rapid expansion, there are other, more effective, ways of encouraging lower emissions. Chief among them would be a tax on aviation fuel or on the flights themselves, either of which would provide the airlines with a direct incentive to improve efficiency.

So has nothing useful come out of this exercise? Most promising, perhaps, is that the European Union, in the shape of the Commission, accepts that climate change is a priority and that the aviation sector has to be included. It also seems to be fumbling towards a realistic appreciation of the problem. It noted, for instance, that someone flying from London to New York and back makes a bigger contribution to global warming than someone heating an average European home for a year.

As yet, though, the Commission seems unwilling, or unable, to draw the requisite conclusion from this observation. It needs to go back to the drawing board and come up with something that meets the interests of the next generation of Europeans rather more and the commercial interests of the airlines a little less.