The Non-CO2 Aviation Emissions: How to Regulate the Elephant in the Room

The non-CO2 aviation emissions (mainly contrails) can, in total, be up to twice as damaging for climate as the CO2 emissions associated to the use of kerosene. As the warming effect of the non-CO2 emissions depends strongly on metereological conditions, it is difficult to attribute the non-CO2 warming effect to a particular flight. Without detailed meteorological information per fight only a blunt emission permit or tax system that taxes all kerosene used in aviation at two to three times the current damage estimate of CO2 could work. Even if this can be justified from an environmental economics point of view, this risks to be unacceptable for the aviation sector. The result is that there is, at present, no active non-CO2 policy. The aviation industry has proposed a 20 year plan to improve the monitoring of these emissions before taking action to address the non-CO2 emissions. We propose a multi-period regulation scheme to address this problem much faster. In the first stage, airlines and public sector agencies are subsidized to improve measurements. These measurement inputs are used to construct a contrail forecasting model. In the second stage, the model is used to propose alternative flight-paths. Airlines are incentivized to adopt the new flightpaths by subsidies that cover the additional flight operation costs. A numerical illustration for the wider EU-region shows that the mechanism proposed can lead to significant climate emission savings that are larger than the savings of CO2 emissions that result from the introduction of ETS or Sustainable Aviation Fuels for aviation.