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viation has a very good story to tell onenvironmental responsibility. We are the only global industry that hasset targets to reduce its carbon footprint.Airlines, airports, air navigation service providers andmanufacturers are committed to:n Improving fuel efficiency by 1.5 per cent annuallyto 2020;n Capping net carbon emissions from 2020 withcarbon neutral growth;n And cutting net emissions in half by 2050,compared to 2005.To understand the ambitious nature of these targets, itis important to put them into context. Aviationrepresents 2 per cent of global man-made carbonemissions. In 2011 airlines will emit about 650million tonnes of carbon. We will do that while carrying2.8 billion passengers and 46 million tonnes of freight.This activity supports 33 million jobs and facilitatesUS$3.5 trillion of global business.In 2050, we expect to carry 16 billion passengers and300 million tonnes of cargo. The global economy willrequire us to accommodate this growth in order tofunction. And we aspire to do that while cutting ourcarbon footprint in half to some 320 million tonnes.Green business is good business. If we can reduce our2012 fuel cost by 1 per cent, that is US$2 billion. Foran industry that is only expecting to make a profit ofabout US$5 billion, that constitutes a very significantsaving. But to be successful, we need to tap resourcesoutside the industry. There are some things that onlygovernments can do. They must be committedpartners in achieving our aspirations. For example, the International Civil AviationOrganization (ICAO), under Kyoto, was given theresponsibility to manage aviation's internationalemissions. It has shown great leadership. At the lastassembly (2010), governments agreed that aviationshould improve fuel efficiency by 2 per cent annually.At the intergovernmental level, this is a majorachievement. It is the only agreement amonggovernments on managing the emissions of anindustrial sector. But there is a gap between theindustry commitment of a 1.5 per cent annual fuelefficiency improvement, and the ICAO goal of 2 percent. The 0.5 per cent difference is dependant ongovernments coming to the table with improvements ininfrastructure. As important as the targets, is theindustry's plan to achieve them. The entire valuechain -airlines, airports, air navigation serviceproviders and manufacturers -are working on a fourpillar strategy to reduce emissions: (1) improvedtechnology, (2) more efficient infrastructure, (3) betteroperations and (4) positive economic measures.ECONOMIC MEASURESOne area of ICAO leadership is on the development ofa global framework for economic or market-basedmeasures to help limit carbon emissions. Aviationsupports the development of a global emissionstrading or compensation scheme -the fourth pillar ofour strategy. The principles for such a globalmechanism have already been agreed through ICAO.And the industry is fully supporting its efforts todevelop a global framework by its 2013 Assembly -less than 24 months away. In the interim, we cannotafford to get distracted by regional schemes which, nomatter how cleverly conceived, cannot be a solution toa global problem. By nature uncoordinated regionalschemes will undermine ICAO's agreed principles. OneAVIATION:COMMITTED TOITS AMBITIOUS GOALS108TRANSPORT & MOBILITYTONY TYLER, DIRECTOR GENERAL AND CEO, IATAA

TRANSPORT & MOBILITY109Below: Tony Tylerof the principles clearly states that airlines should payfor their emissions once -not several times over. Butalready we see the UK's Air Passenger Duty collecting£2.5 billion, which is enough to offset all UKemissions related to aviation four times over. Europe'splanned inclusion of aviation into its emissions tradingscheme makes no provision for the elimination of anyEuropean taxes introduced for climate changepurposes. And we must ensure that any globaleconomic measures will dedicate the monies collectedto environmental projects. If governments simplychannel the funds into general coffers they areundermining the integrity and effectiveness of suchschemes.OPERATIONS AND INFRASTRUCTUREThe second and third pillars of our strategy, operationsand infrastructure, are a good example of wheretargeted investment could yield carbon-reductiondividends. One of the best things that we could do tomake flying more environmentally efficient is to take acoordinated approach to modernising air trafficmanagement. There are two well-established projectsthat are not progressing fast enough. The US NextGenair traffic management programme will generate hugeefficiencies, but funding is being held ransom to short-sighted party politics. Meanwhile, the Single EuropeanSky project has the potential to save 16 million tonnesof CO2 emissions annually. Its progress is also delayedbecause of lack of leadership at state level to see thebig picture and drive improvements. Even as theseprojects inch forward, we have a chance to avoidsimilar problems in Asia. Its skies are getting morecrowded, and we urge governments to start thinking ofa Seamless Asian Sky before the problems becomeacute. TECHNOLOGY The first pillar of our strategy, technology, will be aneven bigger driver of reduced emissions. Today'saircraft and engines are over 70 per cent more fuelefficient than the first jet aircraft. Each newgeneration of aircraft brings about improvements inthe order of 15-25 per cent. And airlines are investingUS$1.3 trillion in 12,000 new planes over the nextdecade. The competitive nature of the airlinebusiness ensures a ready market if a new product canprovide significant cost savings. Our friends at Boeingand Airbus have been doing this for years. And Ibelieve that the introduction of new competition fromother manufacturers will accelerate innovation-which is always a good thing. But technology is notjust about the aircraft and engines. It is also abouthow we fuel the fleet. I believe that the mostsignificant leap forward in the industry'senvironmental performance in the coming years willbe the commercial use of sustainable biofuels.Sustainable biofuels are not a theoretical solution.They are a tested reality. ASTM International'sCommittee on Petroleum Products and Lubricants hasapproved a new specification for hydroprocessedrenewable jet fuel. At least five airlines -KLM,Lufthansa, Finnair, Interjet and AeroMexico -havealready used them on passenger services.Over their life-cycle, sustainable biofuels could reduceour carbon footprint by up to 80 per cent. That is agame changer. But despite the quick progress to date,some major hurdles still remain. One of the highest isto get the big oil companies to come on board withserious investments. Oil companies make good moneyon aviation's US$200 billion fuel spend. Now we needthem to invest to make commercialisation possible atprices that make sense for an industry with margins inthe range of 1 per cent. And we also need governmentsto encourage the development of sustainable biofuelsfor aviation with appropriate fiscal and legal incentives.This is not a plea for handouts, but for strategicdecisions to support investments that foster the growthof green economies that include aviation.PARTNERSHIPThe environment is one of IATA's top priorities and Iam certainly proud of IATA's role as a catalyst for someof the good work that is being done. Of course, thelong-term sustainability of all of these efforts isdependant on strong partnerships held together by acommon vision.Our message for governmentsattending COP-17 is reassurance that aviation remainscommitted to its ambitious emissions reduction goals.Cooperation and partnership -with industry andamong governments -is the key to achieving them. The place to solidify these is ICAO which is the onlyorganisation that can set a global strategic frameworkfor aviation -including for economic measures.Aviation is an instrument of peace and a generator forprosperity -both material and of the human spirit. It isthe collective responsibility of industry andgovernment to ensure that is can continue to fulfill thisunique role rule as a catalyst for sustainabledevelopment with the highest levels of environmentalresponsibility. nABOUT THE AUTHORTony Tyler became the sixth Director General and CEOof IATA on 1 July 2011. Mr Tyler began his career atJohn Swire & Sons in Hong Kong 1977. From 1978he moved within the Swire Group to Cathay PacificAirways, occupying various senior positions at theairline before eventually serving as its Chief Executivefrom July 2007 to March 2011. Mr Tyler served onthe IATA Board of Governors from 2007 to 2011 andwas its Chairman from June 2009 to June 2010." "AVIATION SUPPORTS THE DEVELOPMENT OF A GLOBAL EMISSIONS TRADING OR COMPENSATIONSCHEME