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Should we really be flying? Prof. Colin Bamford University of Huddersfield President, EBEA Lecture content 1. The problem of climate change 2. The contribution of air transport to climate change 3. Costs and benefits of air travel 4. What do economists have to say? 5. Will such measures really curb our demand for air transport? A few questions . . . How old were you when you made your first flight? How old were your children when they made their first flight? How many times more expensive in real terms was the cost of a flight from London to New York in 1959 compared to 2009? How many of you have sought to offset your carbon footprint when making a journey by air? Do you really feel that you should be flying less? The problem of climate change – Stern Report Global temperatures are increasing Temperatures could rise between 2 – 3 degrees (75% chance) or 5 degrees (50% chance) by the end of this century Melting glaciers are leading to rising sea leavens and flooding Massive problems for low lying parts of Asia (e.g. Maldives) Crop yields in Africa will fall, poverty will increase. Global projections of demand (Boeing 2008) The demand for air travel in the UK Global projections of supply Contribution of air transport to climate change Transport is not the only source of greenhouse gas emissions Industry, agriculture and power generation (esp. coal) are also substantial contributors Air transport – 3% of UK total greenhouse gas emissions at present; projected to increase to 8% by 2020 But remember that one long haul trip is typically equivalent to around 1 year’s carbon footprint for all other travel Some relevant benefits Global tourism – climate is a key resource for tourism; highly sensitive to impact of climate change Receipts from international tourism are vitally important for the well-being of many economies e.g. Caribbean, Maldives, Mauritius and in Europe, Spain, Turkey, Croatia, Portugal and so on In the UK, main argument for Heathrow expansion has been the business benefits to the City Airports and airlines are major employers – multiplier effects also on suppliers ; estimate of 1.6 for Heathrow Personal and social benefits of leisure air travel especially Some relevant costs We could find ourselves with Ski resorts with no snow Golf resorts with no water supplies Coral reefs killed off Small paradise islands submerged (e.g. Maldives) Even worse are the catastrophic effects on low lying cities in India, Bangladesh and the USA and the impact of global warming on huge parts of Africa and Australia Local effects of aircraft noise, congestion around airports, loss of valuable land, environmental degradation and flights What do economists recommend – indirect tax! In the UK, Air Passenger Duty (APD). Big rise announced in April 2009 But . . . APD is not an environmental tax – it is really a poll tax on travel Revenue is not hypothecated into environmental improvements - £2bn plus goes into the Exchequer's black hole! Plans to link this to the aircraft and its load factor have been dropped Crazy situation where APD and other charges are in excess of the actual fare paid Could benefit non-UK EU airports such as Schiphol, Paris CDG, Frankfurt, Zurich etc. EU’s response – Emissions Trading Scheme Air travel is now included. 2011 intra – EU flights, 2012 all flights Use of market mechanism to give polluters a form of property right to pollute to a certain level Can sell any unused capacity to others Cost to users will be more focussed that with APD And what can WE do? Could limit our discretionary air travel Could make a contribution to offset carbon footprint e.g. climate protection projects Could respect local cultures and natural environment when we do travel; purchase locally produced food, drink and souvenirs Could stay in the UK for holidays; even become ‘stayvacationists’ for a couple of weeks And if we really cannot do without air travel . . . there is always Yorkshire Airlines Other air transport issues Competition Commission requirement for BAA to sell off Gatwick, Stansted and either Glasgow or Edinburgh-monopolistic practices? Third runway at Heathrow-is it really necessary? Airport expansion at Stansted Heavy losses of BA and other scheduled airlines Growing power of Star Alliance-oligopoly! Consumer issues with low cost carriers eg Ryanair