Document 9.pdf

Ref. Ares(2022)2451656 - 01/04/2022

HH meeting
, Wizz Air, Brussels, 22/11/2022, 12:30
Slots
•  Despite overal  positive developments  in air traffic levels in the EU,
unfortunately  some  long-haul intercontinental markets are stil
significantly lagging behind.  (Chinese market currently down by 51%
because of new flight restrictions to contain the spread of the COVID-
19).
•  That’s why COM wil  very likely adopt another delegated act to extend
slot relief. The industry stil  needs the justified non-use of slots
exception (“force majeure”) in case countries have travel restrictions.
•  As to the new use-rate, the clear improvements in traffic levels justify a
higher rate than the current 50%.
SES
•  We urgently need the SES2+ to modernise the management of
European airspace and to establish more sustainable and efficient
flightpaths.
•  I have to be blunt here: the outcome of the reform is in  jeopardy
without a strong shift of mindset from Member States and from
stakeholders. We are urging al  relevant stakeholders to get on board,
in the spirit of their joint declaration from September 2019, to embrace
the changes proposed and work together to make this reform a reality.
This can directly help with a recovery of the aviation system.
•  Airlines have a key role to play  in conveying the importance of this
reform – especial y now that trilogues have started. So, thank you for
having been outspoken at the EASA Annual Safety Conference, that
political will is needed for the SES reform.
•  I would also invite airlines to think on where they can positively
increase their level of commitment, be it when it comes to flying the
flight plans filed or even the criteria used for the optimization of flight
plans. If there is anything that the regulatory framework could do to put
the airlines on a level playing field in this regard, you should come
forward with it.

Fit for 55 (+ EU pact for sustainable aviation)
•  ETS: airlines currently pay for 50% of its emissions. We propose to
gradual y phase out free allowances by the end of 2026.
•  ReFuelEU: we propose to boost sustainable aviation fuels, by obliging
fuel suppliers to blend at least 2% by 2025, 5% by 2030, 20% by
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2035. We include sub-targets for e-fuels, with 0.7% by 2030 and 5%
by 2035. The initiative is accompanied by a number of flanking
measures such as the Renewable and Low Carbon Fuels Al iance,
Funding Mechanisms (on R&D and also Green Taxonomy).
•  ETD: the uptake of SAF wil  be facilitated with the removal of the
kerosene tax exemption for intra-EU flights. Indeed, while fossil
kerosene wil  be gradual y taxed from 2023 to 2033, SAF including e-
fuels wil  benefit from a minimum zero rate during a 10-year
transitional period (afterwards very low tax rate).
•  CORSIA: EU remains committed to implement CORSIA –started its
offsetting phase in January. At the same time, to reflect the EU’s
climate ambition, we proposed to pay particular attention to certain
aspects of CORSIA i.e. (i) the need to avoid the risk of double
counting of emissions; (i ) the need to foster high participation by
States and (i i) the need to ensure compliance.
•  EU Taxonomy: On 21 April, COM adopted a comprehensive package
of measures to help improve the flow of money towards sustainable
activities across the EU. This include EU Taxonomy Climate
Delegated Act, which already included certain criteria for aviation i.e.
low carbon infrastructure.
•  The new SAF alliance (announced by CAV on 9 November) will be
jointly developed with industry and other stakeholders -  we have
launched a consultation that wil  stay open until 30 November. We
invite all interested parties to submit views and suggestions on the
objectives, tasks and formula of this new industrial alliance.

Single market
•  COM has just relaunched its review of the Air Services Regulation.
The cal  for evidence was published on 8 November, and remains
open for stakeholder feedback until 6 December.
•  An Open Public Consultation is planned for the first quarter of 2022.
Targeted stakeholder surveys and interviews wil  be conducted in
2022 to help inform the evidence base for a support study.  The
legislative proposal is scheduled for the end of 2022.
•  A study has just been launched to assess the impacts of the COVID-
19 pandemic on the aviation sector. Its findings (due summer 2022)
will  contribute to the right setting of COM’s policies (Air Services
Regulation, Airport Charges Directive, Slots Regulation).
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Defensive Points
Slots
Slot relief causes competitive distortions. Why is it still necessary?
•  Eurocontrol data shows that intra-EEA traffic is on a good path to full recovery.
However, we cannot ignore that some world regions are lagging behind because
of travel restrictions.
•  It’s important to strike a balance between the need to be pro-competitive but also
recognise that some airlines are stil  not able to fulfil the 80% use requirement due
to the COVID-19 impact.
SES
General/Timeline

What is the Commission’s view regarding the Council and European
Parliament’s respective positions on SES2+?

•  We expressed strong reservation on the Council’s General Approach. The
Council needs to take a bolder stance, so that the Union can proactively address
issues of the past and ensure an efficient, environmentally performant and
resilient European traffic management framework in the future. The EP position
on the other hand has reaffirmed a progressive and future-proof stance, and
adopted ambitious amendments with a real push for reform.
•  We need a strong shift in  mind-set from Member States and stakeholders. I
remain confident that concerns of the various parties can be overcome while
achieving an ambitious reform.
How does the environmental push of SES2+ relate to the Fit for 55 package?
•  Those reforms are complementary and are all parts of the ‘basket of measures’
needed to ensure aviation’s contribution to the European Green Deal.
•  In the short term, the Single Sky reform that the European Commission has put
forward can help to curb emissions and improve environmental performance of air
traffic management. Analysis from Eurocontrol shows that fuel inefficiency, which
air traffic management can directly influence, amounted to between 8.6% and
11.2%. Even with the current low traffic volumes, an average fuel efficiency
improvement of 5% could be reached. Every day we wait, network inefficiency
leads to unnecessary and avoidable CO2 emissions that are only likely to grow
again soon.
Service Provision
Airlines are still reluctant about financing the costs of the PRB
•  We have to keep in mind the broader picture. A professionalised PRB
administratively located in EASA wil  allow for cost savings (by not establishing a
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new Agency) and wil  be able to concentrate expertise in an independent cell of
EASA.
•  While the PRB decisions in the new framework would not be taken through
Comitology, the decisions can be appealed. This is a strong tool which does not
exist today.
•  The proposed governance foresees strong safeguards to guarantee the
independence of the PRB within EASA, by setting structures independent in their
decision-making.
•  So the cost of this supervision wil  be compensated by the benefits it brings.
Airlines do not support modulation of charges. Airspace users already have
strong financial incentives to reduce greenhouse gas emissions and fuel use
as a result of CORSIA and EU ETS
•  SES reform does not prescribe the details of how modulation wil  look like, but
instead sets the legal framework for such modulation.
•  This modulation is necessary to set meaningful and harmonised incentives across
the Union to stimulate better services and improved environmental performance.
This is a key element in the ‘basket of measures’ needed to ensure aviation’s
contribution to the European Green Deal.
•  The status quo has shown that it is not sufficient to trigger the implementation of
such modulation schemes, and the lack of harmonisation could lead to
insignificant, or even counterproductive, impacts (if flights are incentivised
differently depending on the portion of airspace they cross).

Fit for 55
The Fit for 55 proposal on ETS puts in doubt the EU’s commitment to CORSIA
– are you still a supporter of CORSIA?
•  Yes, definitely. We real y want to see CORSIA becoming successful in relation to
the goal of Carbon Neutral Goal from 2020.  This requires a high level of
participation and robust environmental integrity. The Commission’s proposal is
designed to promote both these conditions and counter potential weaknesses in
CORSIA. The fact that we propose to maintain our current emissions trading
system for intra-EEA flights (and departures to the UK and Switzerland) is a
reflection of our higher climate ambition in the EU and is fully in line with the
statement delivered at the last Assembly so it shouldn’t come as a surprise. In
aviation,  the EU is a single jurisdiction as regards many policies that are widely
accepted (market access, ownership and control, single aircraft certification, third
country operators, blacklist, etc.). To avoid double charging under ETS and
CORSIA on the same routes, the possibility of filing a difference to ICAO exists.
Will the EU sign the proposed International Aviation Climate Ambition
Declaration to be presented during the COP26 climate summit?
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HH meeting
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•  Not decided yet. The declaration addresses States only. EU MS may  sign
provided the level of ambition is in line with EU policy objectives and that there is
sufficient take-up from different world regions (otherwise it may be
counterproductive at this stage).

Background
COVID aviation recovery
The situation of the European aviation eco-system has significantly improved in the last
months. The air traffic level in Europe was down by 22% on 10 November 2021 compared to
the same day in 2019 (intra-Europe flights -21%, intercontinental -28%).
The passenger numbers do not recover in the same pace as the traf ic. According to ACI,
passenger numbers in on 17 October 2021 were down by 35% compared to 2019 (-62%
throughout the year equalling to a loss of 1.26 bil ion passengers).
If analysing the European market by segments, LCC  is down by 23%, traditional -31%,
business +28%, non-scheduled/charter +36% and cargo +10%. On 10 November, Ryanair
was the busiest operator with 1,818 flights (+19% vs 2019), Wizzair operated 424 flights (-
16%).

Slots
Winter 21/22: Slot use rate is set at 50%. The possibility for airlines to return slot series prior
to the start of the season whilst retaining grandfather rights for the following season is
removed; The justified non-use of slots exception (“force majeure” exception) wil  continue to
apply.

Summer 22: COM is monitoring the situation. Has proposed to adopt another delegated act
to extend slot relief to summer 22. Traffic intra-EEA is recovering well. But some regions lag
behind due to continuing travel restrictions – wil  be covered by “force majeure” exception.
COM must adopt the delegated act before 31 December.

ReFuelEU Aviation
The Commission adopted a legislative proposal on 14 July. It is based on a SAF blending
obligation on aviation fuel suppliers with increasing targets over time, starting in 2025 (see
ramp up below). An obligation on airlines to uplift aviation fuel prior to departures from EU
airports aims to ensure a level playing field between airlines and airports for intra and extra-
EEA flights.
•  Proposed ramp-up targets:

SAF flanking measures include:
−  Intensifying EU efforts at ICAO to promote establishment of global SAF targets.
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−  A Renewable and Low Carbon Fuels Value Chain Al iance. Similar to the Batteries
Al iance. Could be the platform to deploy SAF funding mechanisms, notably through an
IPCEI (important project of common European interest). This is stil  hypothetical but there
is interest in the Commission.
−  Steering funding towards SAF deployment e.g. ETS Innovation Fund, Horizon Europe
(R&D), others.
−  Facilitating SAF certification through the establishment of an EU SAF Clearing House
(EASA wil  perform an EP Preparatory Action to assess the feasibility)

SAF Al iance
On  9  Nov,  Commissioner  Vălean  announced  the  creation  of  a  new  Industrial  Al iance  for
Renewable and Low Carbon Fuels Value Chain with the particular focus on the aviation and
waterborne.

The alliance wil  bring together all the relevant stakeholders, including the full industrial value
chain, public authorities, civil society, financial institutions. They wil  work toward the
objective of boosting the production, distribution and use of sustainable fuels. A wide
availability and affordability of sustainable aviation fuels is necessary to accelerate their
uptake and decarbonise aviation.

The alliance introduces an industrial dimension of ReFuelEU Aviation initiative. It
complements the legislative proposal presented as part of the Fit-for-55 package in July. It
also delivers our commitments under the Sustainable and Smart Mobility Strategy and the
European Green Deal.

The new alliance wil  be jointly developed with industry and other stakeholders -  we have
launched a consultation that wil  stay open until 30 November. We invite al  interested parties
to submit views and suggestions on the objectives, tasks and formula of this new industrial
alliance.

Contacts: coordination:
, E1

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