Thursday, 17 March 2011

The EU climate change madness continues

Next year the European Union will force airlines to join its fraud-ridden Emission Trading System:

“Firm action is needed,” Climate Commissioner Connie Hedegaard said in a statement. “Emissions from aviation are growing faster than from any other sector, and all forecasts indicate they will continue to do so under business as usual conditions.”

Airlines will be the second-largest sector in the flawed Emission Trading System, after power generators. The already hard pressed EU airlines are - for good reason - very critical to this latest example of  EU climate change madness:

The industry has countered that the rules, adopted in 2008, would reduce profit by billions of euros because operators would have difficulty passing on the costs to travelers. Airlines will add 32 million tons of demand for EU carbon allowances in 2012, Bloomberg New Energy Finance said today. That would be valued at 508 million euros at today’s prices.

“Fact is that EU ETS means additional costs for Lufthansa up to 350 million euro a year,” said Peter Schneckenleitner, a spokesman for Cologne-based Lufthansa, Europe’s second-biggest carrier. “We still see the EU ETS very critically, a lot of legal prerequisites are still open. For us the ETS means a huge distortion of competition; especially non-EU airlines will benefit from it.”

Read the entire article here

The ETS is so flawed and fraud-ridden that even environmentalists are questioning its value: 

The aim is to put a 'cap' on greenhouse gas emissions but evidence mounts against the scheme with many loopholes allowing for a carbon market with no real cap which awards profits to the biggest polluters.

In addition to over-allocation, windfall profits and the more fundamental problems with the EU ETS, other scandals have taken centre stage recently. In 2010, reports of more sophisticated forms of corruption have demonstrated that when 'buying' and 'selling' a sham commodity, the possibilities for fraud are endless.
'Carousel fraud', which was widespread in 2010, involves claiming value-added tax (VAT) refunds from international carbon trades. The traders import the "goods" or allowances tax-free from markets in other countries and sell them on to domestic buyers, charging the VAT which was never passed on to the treasuries. The result is a quick and difficult-to-trace profit. Part of the problem is that trading in the ETS happens over several different registries making transactions and 'authentic' allowances difficult to verify. The European investigation continues, at the time of writing, with a suspected €5 billion carbon trading tax cost, across at least 11 countries.
New EU regulations have tightened up VAT regulation, making this form of fraud more difficult. However, registries are lax and inconsistent across EU states. When the allowances enter the registries, their authenticity is nearly impossible to determine.
More fundamentally, many registries neglect to carry out any checks on the applicants that seek to open a trading account. The Danish registry, for example, failed to administer checks over the course of two years and was found to be filled with fraudulent companies and false names. Over 90% of the account holders in the Danish system were deleted last year.

Nothing seems to stop the European Union´s unelected bureaucrats from continuing to their totally useless climate crusade. The only hope is that voters in coming elections  vote for EU-critical parties, determined to put an end to the madness. Finnish voters will have a good chance to show the way in the April parliamentary elections .... 

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