Carbon Taxation
Its Impact on Passengers of Aviation Industry
Introduction
Introduction of Carbon taxation by European Union stirred disturbance in the aviation industry
Airlines bear it or pass the effect on the customer
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Rationale Behind Taxation
Airlines use fossil fuels responsible for the emission of:
Carbon compounds
Green house gases (GSGs)
Resulting in hazardous impact on the environment
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Continue-2
Air transportation is the second largest with a 13% share of transport-related greenhouse gas emissions (Kirby, 2008; pg. 35-36)
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Impact of Economic Growth
Increase in National GDPs = more demand for aviation industry
Higher demands = more flights = More emission.
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Impact of Economic Growth on Demand
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Definition of Carbon Tax
A carbon tax is a tax on the relative content of carbon in burned fossil fuels - effectively a tax on the carbon dioxide emissions from burning coal, petroleum based products and natural gas
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Rationale for Carbon Tax
To discourage use of technology which is responsible for excessive carbon emission
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Example of High Carbon & GSG Emission
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Arguments
EU is criticized for introducing carbon tax for supporting its near bankrupt alliances
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Arguments-2
EU states that the carbon tax is just a fraction of overall income of aviation industry and is easy to pay as the industry receives heavy subsidies
Also, since the taxes will be collected by the government, so the benefits will be returned to public in
The main purpose of the carbon tax is reducing greenhouse gas emissions, which contribute to climate change. It would be unreasonable to ignore this environmental problem, because British Columbia is located in the region which is highly affected by the climate change impacts like flooding and wildfires. Therefore, B.C. government
One major objection many economists have to the question of carbon tax effectiveness is whether the taxes on carbon are high enough to create any change in
Jetstar introduced a passenger Carbon Offset scheme in 2007 in accordance with the government’s “Greenhoues Friendly” initiative (
Majority of carbon dioxide is released from big corporate companies and once this policy is implemented, they’ll start to look for alternative, more green sources of energy. Secondly, initiative from citizens is important as well. When residents start supporting locally grown food, using fuel-efficient vehicles or taking the public transit, it drastically reduces our carbon footprint. Lastly, it’s important to commercialize green energy. Although there are many smart companies like Tesla or First Solar, they are not enough. Coal or coal-reliant technologies are prevalent in our communities and therefore, generate the most profit. Therefore, if green technologies become more accessible to the general public, it’ll lead to the growth of this
Case Background: - In transportation industry, one of the biggest challenge is how to deal with carbon dioxide emissions and how to reduce the energy. According to the Natural Resources Canada, one third of the greenhouse emission is because of transportation industry.
If you give people refundable tax credits so that they will be able to purchase health care and have their own private sector.
Climate change is becoming a major issue in Canada and in order to reduce the impact global emission needs usage to start dropping as soon as possible. Therefore, a carbon tax levy has been recently implemented in Alberta. The tax is based on greenhouse gas emission caused from burning fossil fuels. The main reason the province is enforcing Carbon tax is to potentially reduce emission which will develope a change in our climate. B.C has implemented the Carbon tax levy since 2008, and has seen a positive outcome thus far.
Energy, Cars and Farming are some of the largest forms of Greenhouse gas emission. They create a heated atmosphere that
Cowper-Smith & de Grosbois (2011, p.59) stated that airlines are not currently focusing enough on their social responsibilities, an area in which Qantas should look to be at the head of their industry. The way in which Qantas operates can have monumental impacts not only on their customers but to the environment itself. Planes although a current need in society also come with a heavy amount of baggage which influences the environment. Aircraft noise, impact on local air quality are just some of the by-products of aircraft travel (Goodman, 2009 p.14). The most discussed and criticised issue within aircraft travel in the modern climate however, is the affect that it has on the environment. This is due to amount of emissions in which are consumed through aircraft travel. Shell aviation the “leading global supplier of world-class aviation fuel and lubricants” supplies almost 7000 aircrafts with fuel each day, refuelling a plane every 12 seconds. Qantas airlines should be knowledgeable on how much fuel they are using and the type of fuel they are using. Pollution resulting from greenhouse gasses and emissions can result in horrific consequences for the environment. Examples of costs that Qantas may endure from its impact on the environment could be adding to the growing concern of global warming throughout the world (Kolstad, 1996 p.1). This is leading to issues such as sea level rising, melting of snow and ice and changes to plant growth and nutrition
Transportation is the number one thing we consumers do that harms the environment. Transportation causes the highest amount of environmental damage overall - nearly half of the toxic air pollution and more than a quarter of the greenhouse gases traceable to household consumption. Over time, however, sales of trucks, vans and SUV's went from 16% market share to over 50%. One big auto manufacturer even shelved their work of the last three years, spent updating their most popular selling economy car, so they could spend the money getting SUVs to market faster.
In managing the emissions of GHGs(Green House Gases), carbon taxes will be imposed mid 2012. "Economic theory anticipates that with the increased costs of emitting GHGs, drives emitters to downsize their activities." Salem Press (2009)
First we should understand how the carbon cap and trade system came about. The system of carbon cap trade used to be known as ‘emissions trading’, the alliance of free-market republicans and renegade environmentalists got the system adopted as national law in 1990 as a part of the Clean Air Act, to control the power-plant pollutants that cause acid rain, which is triggered by vast clouds of sulfur dioxide
Government banned carbon trading schemes, creating demand for more fuel efficient aircraft as a way to save money (BBC, 2012).
The second largest source of greenhouse gas emissions in the United States is related to transportation, the burning of oil to produce energy in a combustion motor. The combustion process inside of engines is what produces the carbon matter that is emitted into the air through the exhaust system on gas-powered vehicles. Gas-powered transportation is accountable for 24 percent of the global carbon emissions; this should not come as much of a surprise given the amount of urban sprawl that is being seen in the United States and across the globe. In the past decade, the Environmental Protection Agency, the United States government, and major car manufacturers have been working in conjunction to find ways to provide a “greener” form of transportation (EPA, 2011). This has included testing the use of hydropower, ethanol, natural gas, biodiesel, and electricity as a means of powering vehicles, which has led to the introduction of hybrid vehicles. Hybrid vehicles run on electricity and gasoline, the byproduct of oil that is generally used in the engine combustion process of vehicles (U.S. Department of
The U.S government has been actively involved in overseeing emission standards for years. This corresponds with the statement made by the U.S Department of transportation that, “Transportation is the largest end-use sector emitting CO2”, and also the statement released by the NRCAN in which, “Fuel usage & carbon dioxide emissions have grown steadily over the past two decades.” These factors are only to be associated with your average four door sedan and/or light truck. These do not include your 18 wheelers, heavy trucks, or the gas guzzling vans that emit more carbon dioxide into the air and are also on the road more today than ever have been before. Cars are readily and easily obtainable more so now than ever have been. This creates more fuel to be burned up in which produces more toxins to be constantly released into the atmosphere. In fact, according to Scientific American “cars relate as much as 30 gallons of GHG, while only driving 3 miles.” These miles can be correlated with something just as simple as your average work commute. According to the United States Census Bureau, “Nearly 600,000 full-time workers had "megacommutes" of at least 90 minutes and 50 miles.” Those workers alone would each be releasing up to 500 gallons of GHG. These can be considered some of the bigger factors that the greenhouse gasses have taken a toll on.