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EU Rethinks Airline Emissions Trading, Throws U.S. a Bone

The European Commission is scaling back its aviation emissions plan and considering a two-year grace period, until 2013, for foreign airlines before they’re required to participate in its carbon reduction scheme, EUobserver reports (via Business Week). Intra-European flights will be covered by the scheme from the beginning of 2011.

The move could placate the U.S. which has raised the prospect of legal action.

The draft proposal says that airlines will be able to buy pollution allowances “from other sectors in the [EU] community scheme for use to cover their emissions.” The scheme is also to cover Norway, Iceland and Liechtenstein – the three members of the European Economic Area.

Environmental groups have suggested that the costs of the scheme will be felt only by consumers. The airline industry favors the scheme over direct taxes.

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