Major Italian oil company fined €5 million for adverts greenwashing diesel made from palm oil

Italian oil giant Eni has been fined €5 million over its greenwashing of palm-oil based diesel as ‘green’.  It ran a major marketing campaign to con consumers into mistakenly believing its ‘Eni Diesel+’ had a positive impact on the environment. T&E and an Italian environmental organisation had complained about the adverts.  The ruling and fine deliver a blow to attempts by fossil fuel companies to portray biofuels to politicians as a way to decarbonise transport. In practice, diesel made from any sort of food crop causes deforestation due to indirect land use change (ILUC) impacts. Use of palm oil drives destruction of rainforests and wildlife, and EC data shows biodiesel from palm oil is 3 times worse for the climate than regular diesel when ILUC is accounted for. In March 2019 the EU ruled that the use of palm oil in diesel will be gradually reduced from 2023 and should reach zero in 2030, with some exemptions. But palm oil producing countries like Malaysia and Indonesia are pushing hard for palm oil to be used to produce jet fuel, with the pretence that it is lower carbon than conventional fuel.
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Oil major slapped with €5m fine for greenwashing palm oil diesel

Italian oil giant Eni has been slapped with a €5 million fine over its greenwashing of palm-oil based diesel as ‘green’. The company ran a major marketing campaign that deceived consumers by claiming its ‘Eni Diesel+’ has a positive impact on the environment, Italy’s advertising watchdog ruled this week.

By Eoin Bannon   (Transport & Environment)

January 16, 2020

In a landmark ruling against greenwashing, the Italy’s Competition and Market Authority (all’Autorità Garante per la Concorrenza e il Mercato) imposed the highest possible fine on the state-backed energy company.

The agency told Eni not to use the advertisement again after a complaint was lodged by Italy’s consumer organisation Movimento Difesa del Cittadino, environmental NGO Legambiente, and T&E. The oil company has been running ads on TV, radio, in cinemas, fuel stations, print and online platforms since 2016. Official estimates found it cost between €5m and €15m.

T&E said the authority’s decision delivers a blow to attempts by fossil fuel companies to portray biofuels to politicians as a way to decarbonise transport.

Veronica Aneris, T&E’s Italy manager, said: ‘There is no such thing as green diesel made from palm oil or any other food crop because they cause deforestation. Oil companies need to stop trying to mislead drivers and politicians with the fake claim that biodiesel protects the environment and our health. Instead they should invest in proper clean fuels such as renewable electricity. The government should push oil companies to do their fair share to decarbonise the economy.’

The Eni Diesel+ fuel is 15% composed of HVO (Hydrotreated Vegetable Oil) from Eni’s Venice refinery. This ENI refinery makes HVO from crude palm oil and its derivatives, as shown by official data from the governmental energy agency Gestore Servizi Energetici.

The watchdog ruling states that ‘it’s particularly deceitful to use the denomination “Green Diesel’ and the qualifications ‘green’ and ‘renewable’ to refer to the HVO component of the product’. This is mainly because of the indirect land-use change emissions associated with palm oil use. It also argues that there’s no justification or calculation that justifies the 40% reduction in air pollution.

Palm oil is known to be an important driver of the destruction of rainforests and wildlife. According to a study for the European Commission, biodiesel from palm oil is three times worse for the climate than regular diesel when indirect emissions from changes in the use of land are accounted for.

Italian green NGOs are urging the government to stop incentives for the use of palm oil in diesel, and over 50,000 Italians have already requested it at www.change.org/unpienodipalle.

Italy is the second largest palm oil biodiesel producer in the European Union. More than half (54%) of all palm oil and derivatives imported into Italy in 2018 was used to make biodiesel, mainly at Eni’s refinery at Porto Marghera, Venice.

The palm oil comes predominantly from Indonesia and, to a lesser extent, from Malaysia, two countries with notable deforestation rates in the past two decades.

Last March, the EU decided that palm oil is not a green fuel and should not be promoted because it causes deforestation. The use of palm oil in diesel will be gradually reduced from 2023 and should reach zero in 2030, with some exemptions. Thus, Italy, like any other EU country, can amend today the national targets for renewable energy in transport to remove incentives for using palm oil and its derivatives in biodiesel.

https://www.transportenvironment.org/news/oil-major-slapped-%E2%82%AC5m-fine-greenwashing-palm-oil-diesel

 


 

See earlier:

Palm oil may be blended in jet fuel as study shows suitable

April 16th, 2019

by AFIQ AZIZ  (The Malaysian Reserve)

There are technologies currently available to produce biojet fuel, through conversion of biological resources

THE aviation sector can play a crucial role in boosting Malaysian palm oil, which has been saddled with discrimination in the West, low prices and high inventory.

As debates are still ongoing on palm oil fuel for vehicles, the Malaysian Palm Oil Board (MPOB) suggests that the commodity can be mixed into biojet fuel — a composition to be blended with the fossil-based aviation fuel.

MPOB DG Datuk Dr Ahmad Kushairi Din said there are technologies currently available to produce biojet fuel, through conversion of biological resources such as oil, fats, palm fatty acid distillate (PFAD), algae and biomass.

“These technologies are different from the conversion of oils or fats into biodiesel that is used in the transportation sector. The biojet fuel is to be blended with the fossil-based aviation fuel,” he told The Malaysian Reserve (TMR) via an email reply.

While PFAD has been accepted as feedstock for sustainable aviation fuel, works are underway for palm oil to be accepted as well.

Ahmad Kushairi said MPOB has conducted a collaborative study with an American company to identify and screen the suitable feedstock from palm for biojet fuel production.

“PFAD and palm oil have been tested under this study in Chicago, US, for pilot plant trials.

“Based on the study, both have shown good conversion into biojet fuel with by-products such as diesel, naphtha, propane and others. The study showed that PFAD and palm oil are suitable feedstock for biojet fuel,” he said.

“But what we can affirm is that Malaysian palm oil industry’s commitment in participating in the CORSIA implementation (reduce carbon dioxide, or CO2, emission from international aviation), by developing sustainable aviation fuel using PFAD, used cooking oil, oil palm biomass and algae,” he said.

The usage of palm oil in biojet fuel mix can reduce palm oil stocks which put a pinch on prices. Recent data from MPOB showed that in March 2019, end-stocks dropped 4.6% to 2.92 million tonnes from February 2019.

According to Ahmad Kushairi, the International Civil Aviation Organisation (ICAO) has adopted the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) to reduce greenhouse gas emission for the aviation sector.

One of the carbon offsetting measures is to use sustainable biojet fuel accredited under CORSIA.

“With the commitment of CORSIA, the minimum blending of biojet fuel is 2% starting 2027, and the approved blending could be up to 50%,” he highlighted.

Under CORSIA, all airline operators with annual emissions greater than 10,000 tonnes of CO2 are required to report their emissions on an annual basis, with monitoring starting in January 2019.

The CO2 offsetting requirements in CORSIA will be implemented in 2021 in phases with mandatory implementation to begin in 2027.

Ahmad Kushairi said MPOB is currently conducting a feasibility study on aviation fuel for the economy and its impact to airline operators, bearing in mind that any effort to protect the environment comes with a cost.

“For example, a Malaysia-based airline would require 60,000 tonnes per year of biojet fuel to meet the 2% blending ratio requirement,” he said.

Currently, there are more than 80 airlines operating to and from Malaysian airports nationwide.

Ahmad Kushairi said in the Asean region, there is no biojet fuel production plant at the moment.

Currently, European firm Neste Corp is producing green diesel (hydro-treated vegetable oil) from waste oil and vegetable oils at one million tonnes per year capacity. The company has also announced to invest an additional €1.4 billion (RM6.51 billion) for setting up the second bio-refinery plant in Singapore by 2023 for biojet fuel and green diesel production with a capacity of 1.3 million tonnes per year.

Indonesia and Malaysia, the world’s top two producers of the vegetable oil, have threatened to challenge the European Union in the World Trade Organisation over the economic bloc’s plan to ban palm oil-based biofuel by 2030.

To minimise impact and reduce stocks, Malaysia started rolling out the B10 biodiesel (a blend of 10% palm oil in diesel) for the transportation sector last month, while Indonesia has introduced B20 since 2016.

An industry player told TMR that the government should demand ICAO to accept palm oil as part of the biojet fuel blend.

“We could lose this competitive market to our neighbours if we do not address this now. Alternatively, we could mandate the use of biojet fuel domestically using palm oil as feedstock.

“This initiative will help to increase usage of palm oil without subject to the ICAO regulations,” the person said.

https://themalaysianreserve.com/2019/04/16/palm-oil-may-be-blended-in-jet-fuel-as-study-shows-suitable/

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See earlier:

UN plans for aviation biofuels (ie. much from palm oil) & carbon offsets condemned by 89 organisations worldwide

89 organisations from 34 countries have called on the UN’s International Civil Aviation Agency (ICAO) to ditch plans for aviation biofuels and carbon offsets, as the Agency’s governing body convenes in Montreal to finalise proposals for a controversial “Carbon Offsetting and Reduction Scheme”.  An Open Letter by the groups warns that ICAO’s proposal could incentivise airlines to use large quantities of biofuels made from palm oil in order to meet greenhouse gas targets – even though member states rejected biofuel targets last autumn amidst concerns about palm oil. Proposed biofuel targets for aircraft were rejected by member states in October 2017, but groups fear that the proposed new rules will introduce large-scale biofuel use ‘by the backdoor’.  On sustainability certification for palm oil, “none of the schemes has been effective at slowing down deforestation, peatland draining or the loss of biodiversity”. On carbon offsets, the organisations say “There is no way of reaching the goal to limit global warming to 1.5oC unless all states and sectors rapidly phase out their carbon emissions. This means that there can be no role for offsets”. Instead the growth of the aviation sector needs to be limited – rather than depending on greenwash.

Click here to view full story…

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Alistair Osborne in the Times, on how Virgin/ Branson have made fools of the government over Flybe bailout

Alistair Osborne, in the Times, writes about Flybe and the con that has been perpetrated, to get it given government finance. Flybe is 30% owned by Delta and Virgin Atlantic, with 30% owned by Stobart and 40% by New York hedge fund Cyrus Capital. Last February, the trio bought Flybe’s assets for just £2.8 million. Flybe has the contract to operate 4 daily flights from London to Newquay, partly paid for by Public Service Obligation (PSO) by government and Cornwall Council.  This is paid in the belief that the flights are “essential” for “connectivity” but are not commercially viable. (Most passengers in fact are on leisure trips). Those Heathrow slots are very valuable to an airline, and could be used for flights that bring in more profit for the owners. A slot pair at Heathrow can fetch $75 million.  Flybe has got the flights moved from Heathrow to Gatwick. Newquay-Gatwick offers far fewer international connections than Heathrow.  The Heathrow slots will be used for other more profitable Flybe flights, feeding Virgin services. “And now Flybe’s owners have made fools of the rest of the nation by convincing ministers they need some sort of taxpayer bailout.”
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Flybe owners have made fools of us

18th January 2020

Not many people with a £4 billion fortune can convince the government that they are in urgent need of a bailout.  But maybe that’s what makes Flybe co-owner Sir Richard Branson different. The Virgin king has extraordinary powers of persuasion — as he’s also proved by legging over the people of Cornwall.

The Necker Island knight is the joint-owner of Virgin Atlantic, alongside the apparently cash-strapped Delta Air Lines: a business struggling along with a market value of $40 billion. The duo own 30% of Flybe: the regional carrier also 30% owned by Stobart and 40% by New York hedge fund Cyrus Capital. Last February, the trio bought Flybe’s assets for just £2.8 million, since when they claim to have injected £110 million, though nothing like that in cash.

Anyway, with Flybe came the contract to operate Heathrow’s only subsidised service: four flights a day to Newquay. It was operated under the “public service obligation” (POS) regime, where the taxpayer stumps up to help support a service deemed essential for regional connectivity but commercially unviable. Over the four-year contract, the taxpayer is said to be chipping in £3.4 million.

It’s proved a popular service. But not for Flybe’s owners. They swiftly worked out that the Newquay flights were a waste of four lucrative slot pairs at Heathrow: the UK’s top airport, where a single pair can fetch $75 million. So, since the autumn, they’ve been badgering Cornwall county council to change the POS contract. And, no, Sir Richard didn’t actually do the negotiating, leaving it to the likes of Flybe boss Mark Anderson. Even so, he’s got a result.

The council has caved in and agreed to alter the contract from Heathrow to Gatwick. In return, Flybe has apparently offered an extra flight from Newquay to Amsterdam plus higher frequencies to Manchester and Edinburgh. But it’s infuriated locals who wanted the council to fight Flybe’s plans. Newquay-Gatwick offers far fewer international connections than Heathrow. So, hardly a triumph for “levelling up”.

But why would Flybe’s owners care? Given the carrier’s profit-free performance, the most valuable thing it brought was nine pairs of unrestricted Heathrow slots. And now the owners will have four more, unconstrained by the POS contract. True, under the rules, there are limits on their use until they are “grandfathered” to Flybe: handed to it in perpetuity after three years, as long it uses them. But that wouldn’t stop Flybe swapping around its Heathrow slot portfolio, so it can operate more European flights feeding Virgin Atlantic services. It could also potentially sell the slots for cash.

In short, Flybe’s owners have pulled off a nice bit of aviation alchemy — turning subsidised Heathrow slots meant to be used for a public service into commercial ones with real market value. Indeed, industry experts reckon the stunt’s delivered slot pairs worth £15 million apiece. So, £60 million of value — just by doing over Cornwall county council. And now Flybe’s owners have made fools of the rest of the nation by convincing ministers they need some sort of taxpayer bailout. Someone should tell Boris Johnson where Sir Richard goes kite-surfing. Not Newquay, but Necker.

 

Boeing set to stall

Might the Boeing 737 Max never fly again? Well, here’s the latest from Bank of America Merrill Lynch analysts over the plane involved in two fatal crashes: “We are increasingly fielding concerns from investors regarding the likelihood that the Boeing 737 Max never returns to service”.

The analysts think that “very unlikely” but are right that investors spent 2019 viewing Boeing “with a very optimistic lens”. Despite the Indonesian and Ethiopian crashes that killed 346 people and the $9 billion charges taken so far, Boeing shares rose 1 per cent last year. Nothing that’s emerged since, not least the staff exchanges about an aircraft “designed by clowns who are in turn supervised by monkeys” justifies that. And the $4.9 billion set aside to compensate airlines looks nowhere near enough. The bank puts the bill at $20 billion. At $325, Boeing shares are defying gravity.

alistair.osborne@thetimes.co.uk   

https://www.thetimes.co.uk/article/flybe-owners-have-made-fools-of-us-ntzbmc5lh

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See earlier:

 

Scientists appalled at government’s support for high-carbon airline industry, and Matt Hancock ill-informed comments

A letter from a group of leading scientists, in the Independent, criticises the support of this government for the high-carbon emissions airline industry, and the grossly misleading statements made by Matt Hancock (Sec of State for Health) to justify this bailout. On 15 January, he gave his unqualified support for the airline industry on BBC Radio 5 live. He claimed that dealing with the climate emergency does not require any change in our demand for flying, and (mistakenly) thinks electric planes will be a future solution. He said aviation has been decarbonised, which is categorically wrong. Small improvements in aircraft fuel efficiency are far outstripped by the industry’s rate of growth. These positions are at odds with the scientific evidence and the need for deep and immediate reductions in the UK’s emissions. Matt Hancock clearly has no grasp of the huge technical challenges in decarbonising aviation. It is of concern that a Secretary of State can be so misinformed. Flying already constitutes 10% of the UK’s carbon emissions and is predicted to rise by 300% by 2050 unless urgent action is taken.

Click here to view full story…

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Government considering UK APD cut to save loss-making airline Flybe – to boost profitability of domestic flights

Flybe is one of the main airlines that fly domestic routes in the UK – 38% of them. Currently air passengers pay £26 APD on a return domestic flight (and £13 on a return flight to a European airport). Flybe has been struggling for years, as many of its routes are not profitable. It said in October that it recognised, with growing awareness of the higher CO2 emissions from a flight that using the train or coach, (and “flight shame”) that some of the domestic routes should be scrapped. Now Flybe cannot pay its APD bill to the government – about £100 million over three years. So the government, which talked up the importance of regional connectivity before the election, is considering removing APD from all domestic flights. That would be entirely the opposite of what is needed, to tackle UK carbon emissions, and those from UK aviation in particular. Aviation is already subsidised by not paying VAT. The loss to the Treasury from cutting domestic APD would have to be made up by  taxation from other sources. It is not as if all domestic flights are vital to the economy. Most are leisure passengers, making trips to visit places or people, friends or family.

Click here to view full story…

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Why the government’s plan to use public money to bail out Flybe is wrong, and the airline is doomed to fail

There are many reasons (ignoring CO2)  why spending public money to bail out Flybe is wrong. In the Times, Alistair Osborne criticises the plan to effectively pay Virgin Atlantic and Delta, that now own Flybe. They are rich companies, well able to fund Flybe, which they only bought a year ago. It is a blatant misuse of taxpayer money to pay companies like Virgin, and billionaire Branson. Flybe has a lot of its own problems, which is why it is in debt and cannot make money. These include that Flybe has too many planes, 68 aircraft still flying.  An airline analyst said Flybe struggles to compete with low fare carriers, like Ryanair and EasyJet, as their cost per seat is higher. They have been a victim of circumstance: rising fuel prices, an economic slowdown brought on by Brexit and a depreciation of the pound against the dollar. Maybe also the increase in “flight shame” and more carbon awareness.  Flybe does not have a hub airport base, which increases costs, and its network is fragmented low frequency routes. The focus on APD is misleading as the reason for its decline.

Click here to view full story…

Flybe saved after ministers agree a government loan + deferral of APD, and review of APD on domestic flights

The immediate future of Flybe was secured on 14th January evening, after ministers agreed a rescue deal with shareholders to keep the loss making regional airline flying.  The package of measures includes a potential loan in the region of £100m and/or a possible short-term deferral of a £106m air passenger duty (APD) bill to the Treasury, to help it sort out its debts. Also a pledge to review APD on domestic flights before the March budget. Flybe’s owners Connect Airways – a consortium led by Virgin Atlantic – were persuaded to commit millions more to cover ongoing losses. The government is still in negotiations to finalise any loan to Flybe.  The deal was condemned by IAG as “a blatant misuse of public funds” and Virgin “wanting the taxpayer to pick up the tab for their mismanagement of the airline”. Moves to cut APD on domestic flights are totally at odds with any serious attempt to cut CO2 emissions from aviation, as most UK domestic trips can be made on (lower CO2) rail routes. Air travel is already subsidised, by paying no VAT or fuel duty. Some routes deemed socially necessary could be subsidised under EU rules – Flybe’s Newquay to London route is already funded from taxpayers.

Click here to view full story…

Read more »

Scientists appalled at government’s support for high-carbon airline industry, and Matt Hancock ill-informed comments

A letter from a group of leading scientists, in the Independent, criticises the support of this government for the high-carbon emissions airline industry, and the grossly misleading statements made by Matt Hancock (Sec of State for Health) to justify this bailout. On 15 January, he gave his unqualified support for the airline industry on BBC Radio 5 live. He claimed that dealing with the climate emergency does not require any change in our demand for flying, and (mistakenly) thinks electric planes will be a future solution. He said aviation has been decarbonised, which is categorically wrong. Small improvements in aircraft fuel efficiency are far outstripped by the industry’s rate of growth. These positions are at odds with the scientific evidence and the need for deep and immediate reductions in the UK’s emissions. Matt Hancock clearly has no grasp of the huge technical challenges in decarbonising aviation. It is of concern that a Secretary of State can be so misinformed. Flying already constitutes 10% of the UK’s carbon emissions and is predicted to rise .

 

You can watch the comic/tragic Matt Hancock interview (short) here


As scientists, we are appalled at the government’s support for the polluting airline industry

letters@independent.co.uk

Letter from a group of leading scientists, in the Independent

20.1.2020

We write as scientists who are appalled at the support of this government for the high-carbon emissions airline industry, and the grossly misleading statements made by Matt Hancock to justify this bailout.

On 15 January, the health minister communicated his unqualified support for the airline industry on BBC Radio 5 live, and claimed that dealing with the climate emergency does not require any change in our demand for flying. These positions are at odds with the scientific evidence and the need for deep and immediate reductions in the UK’s emissions. Moreover, the minister’s claim that “flying has already decarbonised” is categorically wrong.

While aircraft efficiency is slowly improving, any benefits are being outstripped by ongoing growth in the sector and hence the emissions continue to rise both absolutely and relative to other sectors.

Flying already constitutes 10% of the UK’s carbon emissions and is predicted to rise by 300% by 2050 unless urgent action is taken. The government’s own Committee on Climate Change (CCC) has stated that “[t]here are currently no commercially available zero-carbon planes. This is likely to continue to be the case out to 2050, particularly for long-haul flights, which are responsible for the majority of aviation emissions.”

Matt Hancock clearly has no grasp of the huge technical challenges in decarbonising aviation or, following his comments on “electric planes”, any sense of the timeframe of responding to our commitments under the Paris Agreement. Not only is the prospect of electric planes dominating the long-haul market decades away, but they would require vast amounts of renewable electricity to support current and rising volumes of air travel – renewable electricity, which is urgently required to decarbonise other industrial sectors, such as road transport.

Pointing to a future speculative techno-fix is unfounded and irresponsible, because the science is extremely clear. Globally we must halve our emissions by 2030 to stay within 1.5 degrees of warming, and bring them to zero thereafter. However, the Paris Agreement obligates wealthier nations, such as the UK, to lead on this, requiring reductions in emissions at rates simply incompatible with flying-as-usual, let alone planned airport expansion.

The climate crisis is one of the largest ever threats to humanity. David Attenborough, among others, has warned that the UK must take radical action to meet its climate change targets. In order to do this, we will need to transform our economies completely, away from fossil-fuel energy and land-intensive products, towards low-carbon and efficient ones.

Any government statement that such a transformation can be done without affecting our consumption is without a basis in reality. More and more research demonstrates that reducing energy demand holds the key to rapid emissions reductions. These scenarios do not rely, as do many others (including the CCC’s Net Zero report), on large quantities of carbon removal from the atmosphere after it has been emitted (another speculative, costly and risky techno-fix). Even the CCC’s Net Zero report calls for reductions in transport energy as well as in meat consumption.

Instead of bailing out aviation, the most carbon-intensive form of transport, which is disproportionately used by the wealthiest sections of the population, the UK government should be investing heavily in low-carbon public transit for use by all of its citizens.

Subsidising short-haul flights (as the government has just done to the tune of £106m for the benefit of Flybe) and misleading the public on the necessary scale of action exacerbates the climate emergency rather than acting on it, and demonstrates a tragic failure of leadership – especially since the UK is hosting the COP26 climate summit in Glasgow later this year.

Professor Julia Steinberger, University of Leeds
Dr Stuart Capstick, Cardiff University
Dr Milena Buchs, University of Leeds
Professor Kevin Anderson, University of Manchester
Professor Tim Jackson, University of Surrey

Dr James Dyke, University of Exeter

https://www.independent.co.uk/voices/letters/climate-crisis-carbon-emissions-airline-matt-hancock-huawei-brexit-boris-johnson-trump-a9292811.html

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See earlier:

 

Government considering UK APD cut to save loss-making airline Flybe – to boost profitability of domestic flights

Flybe is one of the main airlines that fly domestic routes in the UK – 38% of them. Currently air passengers pay £26 APD on a return domestic flight (and £13 on a return flight to a European airport). Flybe has been struggling for years, as many of its routes are not profitable. It said in October that it recognised, with growing awareness of the higher CO2 emissions from a flight that using the train or coach, (and “flight shame”) that some of the domestic routes should be scrapped. Now Flybe cannot pay its APD bill to the government – about £100 million over three years. So the government, which talked up the importance of regional connectivity before the election, is considering removing APD from all domestic flights. That would be entirely the opposite of what is needed, to tackle UK carbon emissions, and those from UK aviation in particular. Aviation is already subsidised by not paying VAT. The loss to the Treasury from cutting domestic APD would have to be made up by  taxation from other sources. It is not as if all domestic flights are vital to the economy. Most are leisure passengers, making trips to visit places or people, friends or family.

Click here to view full story…

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Why the government’s plan to use public money to bail out Flybe is wrong, and the airline is doomed to fail

There are many reasons (ignoring CO2)  why spending public money to bail out Flybe is wrong. In the Times, Alistair Osborne criticises the plan to effectively pay Virgin Atlantic and Delta, that now own Flybe. They are rich companies, well able to fund Flybe, which they only bought a year ago. It is a blatant misuse of taxpayer money to pay companies like Virgin, and billionaire Branson. Flybe has a lot of its own problems, which is why it is in debt and cannot make money. These include that Flybe has too many planes, 68 aircraft still flying.  An airline analyst said Flybe struggles to compete with low fare carriers, like Ryanair and EasyJet, as their cost per seat is higher. They have been a victim of circumstance: rising fuel prices, an economic slowdown brought on by Brexit and a depreciation of the pound against the dollar. Maybe also the increase in “flight shame” and more carbon awareness.  Flybe does not have a hub airport base, which increases costs, and its network is fragmented low frequency routes. The focus on APD is misleading as the reason for its decline.

Click here to view full story…

Flybe saved after ministers agree a government loan + deferral of APD, and review of APD on domestic flights

The immediate future of Flybe was secured on 14th January evening, after ministers agreed a rescue deal with shareholders to keep the loss making regional airline flying.  The package of measures includes a potential loan in the region of £100m and/or a possible short-term deferral of a £106m air passenger duty (APD) bill to the Treasury, to help it sort out its debts. Also a pledge to review APD on domestic flights before the March budget. Flybe’s owners Connect Airways – a consortium led by Virgin Atlantic – were persuaded to commit millions more to cover ongoing losses. The government is still in negotiations to finalise any loan to Flybe.  The deal was condemned by IAG as “a blatant misuse of public funds” and Virgin “wanting the taxpayer to pick up the tab for their mismanagement of the airline”. Moves to cut APD on domestic flights are totally at odds with any serious attempt to cut CO2 emissions from aviation, as most UK domestic trips can be made on (lower CO2) rail routes. Air travel is already subsidised, by paying no VAT or fuel duty. Some routes deemed socially necessary could be subsidised under EU rules – Flybe’s Newquay to London route is already funded from taxpayers.

Click here to view full story…

Any plans by UK government to remove APD on domestic flights would be unhelpful on CO2 emissions

Responding to the news that Boris Johnson’s Tory government is considering dropping all APD on domestic flights (just cutting it for Flybe would not be legal, for competition reasons) groups that understand about the need for cuts in carbon emissions reacted with dismay (to put it politely). Doug Parr, chief scientist at Greenpeace, commented: “This is a poorly thought out policy that should be immediately grounded.  The Government cannot claim to be a global leader on tackling the climate emergency one day, then making the most carbon-intensive kind of travel – flying – cheaper the next. Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need if we’re to cut climate-wrecking emissions from transport. The aviation sector has got away for years with increasing its carbon footprint. The last thing we need is another incentive for them to pollute more.”  Caroline Lucas commented on Twitter: “Addressing #Flybe problems by reducing #APD on all domestic flights is utterly inconsistent with any serious commitment to tackle #ClimateCrisis. Aviation already subsidised – no tax on fuel. Domestic flights need to be reduced, not made cheaper.”  Jenny Bates at Friends of the Earth said on Twitter: “APD cut on domestic flights would be “unacceptable & reckless” ⁦we at  @friends_earth ⁩ say-we must cut aviation emissions not encourage them.”

Click here to view full story…

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Sadiq Khan announces green new deal for London if re-elected in May, and says Heathrow 3rd runway would be “catastrophic”

Sadiq Khan has announced that he would introduce a green new deal for London and make the city carbon-neutral by 2030 if re-elected in May this year.  He also outlined the steps that he would take in the future to combat the climate crisis, and air pollution. He said his plans “will help to address the inequality that exists in our city and create the green jobs and industry that can sustain our communities in the future.” Asked about Heathrow expansion, Sadiq Khan said: “A new runway at Heathrow would be catastrophic… I think that a new runway at Heathrow won’t happen for the foreseeable future because of the legal challenges going ahead.”  The election for Mayor will be on 7th May, and is a two-horse race between Sadiq and the Tory candidate, Shaun Bailey.  Other cities such as Copenhagen and Oslo have made similar commitments to become carbon-neutral.
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Sadiq Khan announces green new deal for London

By Elliot Chappell  (Labour List)

18th January, 2020

Sadiq Khan has announced that he would introduce a green new deal for London and make the city carbon-neutral by 2030 if re-elected in May this year.

Focusing on climate issues and the upcoming mayoral contest, the mayor spoke to the Fabian’s Society New Year conference in Euston today.

Taking to the stage, Khan set out his record as London mayor but also outlined the steps that he would take in the future to combat the climate crisis.

He announced that he would set a target for the capital to be carbon neutral by 2030, and said that the government needed to introduce a national green new deal.

The Mayor declared: “My pledge to deliver a green new deal for the city, with a target for London to be carbon neutral by 2030, will help tackle the climate emergency and the air pollution crisis.

“Some may say that a 2030 target isn’t achievable but I say we can’t afford not to try. This is a matter of social justice because it’s the poorest communities that are being hit hardest. My plans will help to address the inequality that exists in our city and create the green jobs and industry that can sustain our communities in the future.”

Speaking about the broader challenges facing the country and the world in terms of climate issues, the mayor said that “we are at a critical moment in history – our planet is burning, towns across our country are flooding”.

Khan declared a “national and indeed international green new deal” is needed and said: “My message to the government is this: let’s work together to stave off disaster.”

But he claimed that the key dividing line between him and the Tory candidate is their respective approaches to air pollution in the capital and climate issues.

“The election on May 7th is a two-horse race between me and the Tory candidate. My Conservative opponent is shamefully seeking to defend his government’s failure to meet its climate and air pollution obligations and delay taking the action we need.

“In stark contrast, I will stand up for our city, defend our values of fairness, equality and sustainability and take bold action not only to address the crisis we face, but support green jobs, skills and businesses.”

Asked about Heathrow expansion, Khan replied: “A new runway at Heathrow would be catastrophic… I think that a new runway at Heathrow won’t happen for the foreseeable future because of the legal challenges going ahead.”

The Labour 2019 manifesto committed the party to finding “a path” towards net-zero carbon emissions by 2030.

At the last election, the Conservatives put forward a policy to achieve net-zero by 2050, while the Lib Dems promised a date of 2045.

This announcement from Khan follows other cities in Europe, such as Copenhagen and Oslo, that have made similar commitments to become carbon-neutral.

https://labourlist.org/2020/01/sadiq-khan-announces-green-new-deal-for-london/

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There is  more on the issue of London being carbon neutral, at

Climate change: The challenges facing London

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Delay till May for Shapps to decide whether to allow Manston Development Consent Order (“DCO”)

The decision by the DfT on whether to re-open Manston as an airport again for air cargo has been delayed for four months. It had been expected on 18th January.  The airport has been closed since 2014. RiverOak Strategic Partners, the consortium behind the scheme, had applied for the airport to be considered as a nationally significant infrastructure project. Having had 3 months to digest the Planning Inspectorates’ report, the DfT now want more information from RiverOak by 31 January. The Secretary of State (SoS) Grant Shapps has set a new deadline of 18 May 2020 for the decision to be made. The Aviation Strategy is expected before summer recess, with the DfT consultation on climate imminent, so the DfT are giving themselves until May to avoid shooting themselves in the foot on carbon, as they did with Flybe.  RiverOak are trying to argue that Manston could be successful on cargo, as “the air freight market is ripe for an alternative to the overcrowded London airports system”. Some people in the area are hoping Manston could provide jobs; others are deeply concerned about the noise from old freighter aircraft during the night, flying over residential areas (the approach path is right over Ramsgate).

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Decision on Manston Airport plans delayed until May

16 January 2020

The decision on whether to use Manston as an airport again has been delayed for four months.

An announcement on the plans was expected over the next few days, with some hoping the site near Ramsgate would be able to be used as a cargo air hub again.

Manston airport has been shut for years but could now re-open

However, today it has been announced the deadline has been extended.

RiverOak Strategic Partners, the consortium behind the scheme, had applied for the airport to be considered as a nationally significant infrastructure project.

The airport closed in 2014, with owner Ann Gloag deciding to pull down the shutters in a move that seemed to sound the death knell for Manston.

A service to Amsterdam run by Dutch airline KLM, looked as though it would earn a footnote in Manston’s history as the last to operate out of the airport.

.It was then sold to developers Stone Hill Park, who set out ambitious plans to redevelop the huge site for thousands of homes and businesses. 

But in a late twist to the long-running saga, the two partners in Stone Hill Park announced they had sold the site to RSP – just days before the inquiry was due to end.

The former owners formally withdrew their opposition to the DCO application being made by what had been their rivals.

As a result, the planning inspectorate was no longer required to consider the case for a Compulsory Purchase Order. However, under the process they were required to consider other representations from other parties and have had to take into account the financial viability of RSP’s plans.

RSP had argued the site could sustain a cargo hub, saying the air freight market is “ripe for an alternative to the overcrowded London airports system”.

KMTV reporting on the announcement made last year that Manston could once again be used as a hub for cargo flights

It described how a revived Manston Airport could provide air freight operators with “a realistic alternative to the overcrowded London airports, ease the considerable road congestion caused by lorries carrying freight through the channel tunnel to European airports”.

It also said it could boost economic growth and jobs in Kent.

But the possibility of passenger flights operating from Manston is less sure, with RSP saying it is not ruling out the idea but that its focus is initially on developing Manston for cargo freight. The controversy over the government’s aid for the struggling passenger company Flybe is an indication of the vulnerability of smaller operators.

The fate of Manston has split opinion, with campaigners on both sides arguing over the merits of the case.

It also divided political parties and arguably cost the former Ukip leader of the council, Chris Wells, his job after he ruled out joining forces with RSP to pursue a Compulsory Purchase Order.

The Secretary of State received the Examining Authority’s report on the Manston Airport Development Consent Order application on October18 and the deadline for a decision had been Saturday.

But today the DfT said: “The deadline for the decision is to be extended to May 18 to enable further information on a range of issues to be provided.

“The decision to set a new deadline is without prejudice to the decision on whether to give development consent.”

A statement from RiverOak said: “While frustrating, the delay is not unexpected – the last five decisions on DCO applications have all been delayed and none have yet been made. Undoubtedly, the recent General Election, ongoing Brexit process and significant infrastructure workload for which the government is responsible have also played a part.

“RSP has not received any additional questions from the minister, as part of the deliberation process, to date – but stand ready to respond, should there be any requests for additional information needed to reach a final decision. The delay does not affect the current CAA airspace change consultation process, which is entirely separate from the DCO.”

https://www.kentonline.co.uk/thanet/news/manston-decision-delayed-by-4-months-220254/


See more details on the history of the decline of Manston airport at

https://en.wikipedia.org/wiki/Manston_Airport


See the letter from the Department for Transport

to RiverOak Strategic Partners Limited

on 17th January 2020

http://infrastructure.planninginspectorate.gov.uk/document/TR020002-005170

Dear Sir/Madam
Planning Act 2008 and The Infrastructure Planning (Examination Procedure) Rules 2010
Application by RiverOak Strategic Partners Limited (“the Applicant”) for an Order granting
Development Consent for the reopening and development of Manston Airport in Kent.
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REQUEST FOR COMMENTS AND FURTHER INFORMATION

The Examining Authority (“ExA”) submitted on 18 October 2019 a Report and Recommendations in respect of its findings on the above application to the Secretary of State for Transport (“the Secretary of State”).
In accordance with section 107 of the Planning Act 2008, the Secretary of State had until 18 January 2020 to make a decision on the Development Consent Order (“DCO”) application.
However, in order to allow time for the steps below to be taken, the Secretary of State has set a new deadline for a decision on the Application of 18 May 2020. A statement confirming the new deadline for a decision was been made to Parliament on 16 January 2020 in accordance with section 107(7) of the Planning Act 2008.
The Secretary of State would be grateful if the Applicant and other affected parties where highlighted in bold could provide further information or comments on the matters set out below.
Unilateral Undertakings
1. The Secretary of State seeks comments from Kent County Council and Thanet District
Council in relation to their respective Unilateral Undertakings, that were submitted on 9 July 2019 (the final day of the examination), in relation to the appropriateness of RiverOak Fuels being the named party in those Undertakings.
2. The Secretary of State invites views from Thanet District Council regarding the level of
the financial payments proposed in the Unilateral Undertaking representing the Applicant’s
contribution for the Air Quality Station ZH3 and whether that commitment will ensure the air quality  in Thanet Air Quality Management Area is not negatively impacted by the Development.
3. The Secretary of State invites views from Kent County Council on the acceptability and
adequacy of the Applicant’s contribution of £139,000 per year for affected schools for 20 years to mitigate and minimise the noise effects on schools.
4. The Secretary of State requests that the Applicant provides a new Unilateral Undertaking in favour of Thanet District Council so as to identify correctly the District Council in Schedule 3 as the discharging body for any requirement relating to the Education, Employment and Skills Plan.
5. The Secretary of State invites the views of Kent County Council on the proposed mitigation
for off-site junction improvements schemes included in the Unilateral Undertaking in favour of the County Council.
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Transport/Engagement with public transport operators
6. The Secretary of State invites the Applicant to comment and indicate agreement on a
revised requirement 7, which is set out at Annex A to this letter. This will impose an obligation on the Applicant to agree a Bus Service Enhancement Scheme, including the enhancement of existing services and the provision of a shuttle bus service.
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and there is a lot more, over 15 pages …
https://infrastructure.planninginspectorate.gov.uk/document/TR020002-005170
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Manston airport DCO decision by government delayed until May

January 16, 2020

Kathy Bailes  (Isle of Thanet news)

A decision by the Secretary of State over the development consent order to create a cargo hub at the Manston airport site has been pushed back by four months.

The decision had been due on January 18 but a written statement to Parliament made by Nusrat Ghani, Parliamentary Under Secretary of State for Transport, today (January 16) said the latest delay means the outcome is now due to be announced on May 18.

Her statement said: “The Secretary of State received the Examining Authority’s report on the Manston Airport Development Consent Order application on October 18, 2019 and the current deadline for a decision is January 18, 2020.

“The deadline for the decision is to be extended to May 18 (an extension of 4 months) to enable further information on a range of issues to be provided by the applicant and other interested parties before determination by the Secretary of State.

“The decision to set a new deadline is without prejudice to the decision on whether to give development consent.”

The Planning Inspectorate examining panel, led by Kelvin McDonald, examined the bid last year, made by Riveroak Strategic Partners (RSP) to acquire the site and create a cargo hub and associated aviation business.

The land was owned by Stone Hill Park, which had submitted a planning application to create up to 3,700 homes, business and leisure and associated infrastructure. SHP sold the site to RSP subsidiary RiverOak MSE Ltd for £16.5 million in July, just before the hearings concluded.

DCO approval is still needed for the cargo hub project, an issue which has split the isle. Supporters of the plan say it will bring jobs and economic benefits but campaigners against the proposals say it will result in pollution, noise and a loss of tourist trade – particularly in Ramsgate which is under the flight path.

During the hearings representations were made by a wide variety of organisations, including Thanet council and Historic England, campaign groups including Save Manston Airport association, Supporters of Manston Airport, No Night Flights and Nethercourt Action Group, numerous individuals and both Manston museums.

The decision letter and Recommendation Report will be published on the Planning Inspectorate Manston project page once a decision has been made.

A statement from RSP says: “While frustrating, the delay is not unexpected – the last five decisions on DCO applications have all been delayed and none have yet been made. Undoubtedly, the recent General Election, ongoing Brexit process and significant infrastructure workload for which the government is responsible have also played a part.

“RSP has not received any additional questions from the minister, as part of the deliberation process, to date – but stand ready to respond, should there be any requests for additional information needed to reach a final decision. The delay does not affect the current CAA airspace change consultation process, which is entirely separate from the DCO.”

Of the most recent DCO projects awaiting decision, seven – including Manston – have been delayed, with five due to more information being requested and two due to the general election.

https://theisleofthanetnews.com/2020/01/16/manston-airport-dco-decision-by-government-delayed-until-may/

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See earlier:

Manston airport decision before long, after Planning Inspectorate sends recommendation to Grant Shapps

Government planners, the Planning Inspectorate (PINS) , have made their decision on whether a bid to reopen Manston Airport as a cargo hub should be backed. The recommendations have been sent to Transport Secretary of State (SoS) Grant Shapps, who  has 3 months to decide whether to grant planning permission to site owners RiverOak Strategic Partners (RSP) in the form of a Development Consent Order (DCO). The decision is made the SoS because the airport re-opening is considered a Nationally Significant Infrastructure Project (NSIP) which is not decided by a local authority. It the SoS approves the plans, the owners RSP will probably use the airport primarily for air cargo.  In July Stone Hill, the site’s previous owners, agreed to sell the land to RSP for £16.5m, instead of their plan to build up to 3,700 homes on it.  The tonnage of air freight has risen by only 11% in the UK in the past 10 years, with most going through Heathrow. But RSP says “there has been continuing growth in the air freight cargo market, driven chiefly by the increase in e-commerce and … e-fulfillment…”  Manston re-opening will be strenuously opposed by local people, largely to noise over Ramsgate, from old, noisy freighters, often at night.

Click here to view full story…

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Why the government’s plan to use public money to bail out Flybe is wrong, and the airline is doomed to fail

There are many reasons (ignoring CO2)  why spending public money to bail out Flybe is wrong. In the Times, Alistair Osborne criticises the plan to effectively pay Virgin Atlantic and Delta, that now own Flybe. They are rich companies, well able to fund Flybe, which they only bought a year ago. It is a blatant misuse of taxpayer money to pay companies like Virgin, and billionaire Branson. Flybe has a lot of its own problems, which is why it is in debt and cannot make money. These include that Flybe has too many planes, 68 aircraft still flying.  An airline analyst said Flybe struggles to compete with low fare carriers, like Ryanair and EasyJet, as their cost per seat is higher. They have been a victim of circumstance: rising fuel prices, an economic slowdown brought on by Brexit and a depreciation of the pound against the dollar. Maybe also the increase in “flight shame” and more carbon awareness.  Flybe does not have a hub airport base, which increases costs, and its network is fragmented low frequency routes. The focus on APD is misleading as the reason for its decline.
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Flybe rescue: Boris Johnson flies to help of Sir Richard Branson

15.1.2020

Now we know who BoJo’s governing for: Sir Richard Branson. And what better cause than him? The man from Necker Island’s only worth £4 billion. Plus his chums, of course, from Delta Air Lines: the US carrier valued at a mere $38 billion.

The duo own Virgin Atlantic: one of a trio of investors daft enough to have bought Flybe last year. The other two? Cyrus Capital, a hedge fund managing $4.4 billion of assets. And Stobart Group, a relative tiddler but still valued at £400 million. So, not obvious candidates for a government rescue — not least from a Tory regime that let Monarch and Thomas Cook go bust.

True, no one wanted to see Flybe go under, putting 2,400 jobs at risk. And there’s something to be said for BoJo’s pragmatism in saving an airline responsible for 38 per cent of domestic flights. It does play a part in “ensuring the UK regions remain connected”, as business secretary Andrea Leadsom put it. But the notion that Flybe’s owners were too cash-strapped to keep the carrier airborne is ridiculous.

They only bought Flybe last February, snaffling the assets out of the holding company for just £2.8 million. Yes, Virgin says they’ve since injected £130 million to keep it in the skies, which, if true, makes you wonder where the money’s gone. But it’s less than a year since they were banging on about providing “a strong foundation to secure the long-term future of Flybe”. How long term is 11 months?

And it’s not as if the world has changed. They knew all about Brexit, the weak pound and the tendency of credit card companies to hang on to payments from passengers in struggling airlines. They also knew about the £13 air passenger duty on one-way domestic flights. To boot, they’ve been too slow to cull a bloated carrier that’s still flying 68 aircraft.

So it says something for the negotiating powers of Flybe’s owners and its boss, Mark Anderson, that he’s convinced ministers to agree a £100 million-plus rescue package. It’s said to include allowing the carrier to defer paying APD and other taxes, plus a potential government loan. On top, ministers have pledged to consider cutting APD on domestic flights: a likely change in March’s budget.

What does that say for the government’s environmental credentials? As Greenpeace put it: “Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need.” It will also boost British Airways-owner IAG: a poor cause for charity, given it’s valued at £13 billion. What precedent does it set, too, for other companies that come knocking?

Thankfully, the deal was conditional on Flybe’s owners injecting fresh equity — said to be between £20 million and £40 million. But, if the government is serious about regional connectivity, it’s not individual airlines that need saving but regions at risk of being cut off should they fail. Doesn’t the Flybe affair make the case for having more flights subsidised under the “public service obligations” regime, which helps to fund the Newquay-London service for example? Airlines would tender to run such flights for a fee. Better that than the awkward impression BoJo’s just given with Flybe: that he’s happy to bail out the likes of Sir Richard.

https://www.thetimes.co.uk/article/flybe-rescue-boris-johnson-flies-to-help-of-sir-richard-branson-2q6rksq3q

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Why the government’s plan to rescue Flybe is doomed to fail

Ailing budget airline Flybe is in line for a rescue package from the government. But that alone won’t be enough to save it

By WILL BEDINGFIELD (Wired)

16.1.2020

After taking a nosedive towards financial ruin, British regional airline Flybe has narrowly avoided a disaster, thanks to the UK government, which has confirmed a plan to save it.

The government’s rescue package includes a potential loan of around £100 million and a pledge to review taxes on domestic flights, as well as a headline-grabbing measure – a possible short-term deferral of the £106 million air passenger duty (APD) bill due from the beleaguered airline, a tax introduced in 1994 to pay for and highlight the environmental costs of air travel.

The initial response to the government’s action has been negative – both environmental groups and British Airways, who filed a complaint with the EU over a “blatant misuse of public funds” on Wednesday, have argued that Flybe should be left to fail.

What complicates these grievances is that many of Flybe’s 9.1 million passengers rely on the service for regional connections – two fifths of its flights are domestic. For instance, suggestions that these passengers’ needs could be met by alternative forms of transport, like high speed rail, fall short for island economies – such as the Isle of Man, Jersey and some Scottish islands. “That that’s a laudable ambition,” says Grant. “But how far away [from realisation] are these alternative modes of transport, and what would happen to these regional economies in the meantime?”

But while government intervention may temporarily correct Flybe’s course, it won’t fix underlying problems. APD was a major issue for the company because Flybe has to pay the tax twice, since a return flight within Britain incurs double charges. “APD has been a moan for airlines for a long time,” says James Brass, a partner at consultancy York Aviation. “Flybe’s exposure to domestic travel and the oddities around that and APD has been problematic, but equally they’ve got more serious problems.

“They really struggle to compete with low fare carriers, like Ryanair and EasyJet, simply because their cost per seat is higher.”

He argues that Flybe has also been a victim of circumstance: rising fuel prices, an economic slowdown brought on by Brexit and a depreciation of the pound against the dollar. After all, less than one per cent of Flybe’s revenues are in dollars, the currency with which most airlines pay their bills.

The focus on APD has actually been misleading, says John Grant, an analyst at digital flight information company OAG. “It is not the single most important factor, and it’s been a wonderful Trojan horse for [Flybe] to use to hide other failings and problems in the business.”

An obvious problem that Flybe suffers from is the lack of a hub airport. Its destinations are made up of an extremely fragmented network of low frequency flights. Only around two per cent of its flights operate out of London Heathrow each week, missing out on the connecting traffic of the UK major hubs, explains Grant.

“If someone said to you ‘Where’s British Airways based?’, they’ll tell you Heathrow. Or ‘Where is EasyJet based?’ It’s Luton and Gatwick,” he says. “Flybe flies to 26 airports in the UK and most of them have less than six flights a day. In terms of where the aircrafts are located, it’s so fragmented, so complex, that as a business you can’t manage it.”

https://www.wired.co.uk/article/government-flybe-rescue

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Airline offsetting is a distraction from policies that can actually reduce aviation CO2 emissions

Andrew Murphy, aviation expert at T&E, explains why offsetting does not work to remove the carbon flights emit. He gets asked about this a lot. He says:  “It’s a reality that people fly more and more regularly …for some it is unavoidable …What’s equally unavoidable is the climate impact of those flights … There is no “green option” for flying … Offsetting is just paying someone else to reduce your emissions, rather than reduce your own. For example, investing in renewable energy or tree-planting in some other part of the globe. … Do carbon offsets work? … Many have called them modern day papal indulgences … offsetting most certainly will not wipe your carbon slate clean … they won’t work in practice, and they won’t work in theory … [trees planted may not survive, a solar farm might have been built anyway] … there is the problem of “additionality” … some offsets are when parties set weak targets for themselves, and sell you any overachievement as an offset. No extra emissions are reduced … While offsetting by individuals is, at worst, ineffective, Governments implementing offsetting schemes worse (eg. Corsia) – a distraction from effective policies that can actually reduce aviation emissions.”  Read the whole blog.
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Airline offsetting is a distraction from policies that can actually reduce emissions

“Should I offset my flight, and if so, which offset should I use” is now the question I get asked most frequently.   It’s understandable – CO2 emissions per flight mean that flying is by far the most carbon intensive activity anyone can engage in.

By Andrew Murphy (Transport & Environment – T&E)

January 13, 2020

It’s a reality that people fly more and more regularly. Some have cut back on flying, a few have given up entirely. But, whether it’s for work or to visit family abroad, flying, for many, is unavoidable.

What’s equally unavoidable is the climate impact of those flights.

We’re fortunate that in an increasing number of our consumer choices, we can choose the greener option. Electric cars, renewable energy, meatless diets and well insulated homes. But no “green option” exists for flying. (More below on why that’s the case.) 

So for those wanting to fly, it leaves them in a bind, looking for a way to compensate for the climate damage they are causing. The answer being presented by some is to offset – to pay someone else to reduce their emissions, rather than reduce your own. For example, investing in renewable energy or tree-planting in some other part of the globe.

Do carbon offsets work? 

Many have called them modern day papal indulgences, after the middle ages practice of paying priests to absolve you of your sins. I’m not a theologist, indeed I’m a (very) lapsed Catholic, so I’m no expert on whether indulgences will cleanse your soul. But we can be honest and say that, after decades of trying to make them work, offsetting most certainly will not wipe your carbon slate clean. The reasons are, unfortunately, a little complex but, briefly, there’s a reason they won’t work in practice, and a reason they won’t work in theory. 

The “in practice” is easiest to explain. When you make a payment, you can’t be sure that the carbon-cutting activity you pay for actually takes place, or wouldn’t have taken place regardless of the payment. For example, whether those trees planted won’t burn down, or whether the solar plant was going to be built anyway. It’s known as “additionality” and the most comprehensive research has shown that most offsets don’t have it.

The theoretical problem is rooted in how the Paris Agreement has been designed. The agreement has a temperature and emissions target, but it lets each party set their own level of ambition. That leaves open the possibility that parties will set weak targets for themselves, and sell you any overachievement as an offset. No extra emissions are reduced, but you’re led to believe that you’re flying sustainably.

As a result, it’s fair to say that offsetting, more generally, is incompatible with the Paris Agreement. That agreement is about all sectors and all parties bringing their emissions to zero.

Paying someone else to reduce emissions, while airlines keep burning fossil fuels, is incompatible with that objective. 

Fitting offsetting into the Paris Agreement is like fitting a square peg into a round hole

Despite this apparent contradiction, the Paris Agreement does in fact have provisions relating to offsetting, contained in Article 6 of that agreement. The catch is that, four years after the Paris Agreement was signed, states still can’t agree how to operationalise these provisions. They failed again last month at the climate conference in Madrid. It’s the only section of the agreement that negotiators have failed to operationalise.

And they are likely to continue to fail, because fitting offsetting into the Paris Agreement is like fitting a square peg into a round hole. Offsetting should be seen as a bug, not a feature, of the agreement.

How to cure climate guilt? 

Where does all this leave the concerned citizen who wants to cure their climate guilt? They can offset, doing their best to find the most reputable suppliers. The transfer of any money from the well-off (and it is the well-off who fly most) to those most affected by climate change (and it’s always the worst-off who’ll be most affected) should be welcome.

The unavoidable reality is that the limited benefits of offsetting will never be enough to offset the known damage of flying.

That hasn’t stopped industry from investing in them, even when they freely admit that offsetting isn’t a solution. And there are moves underway to finalise a global system where airlines will offset a portion of their emissions (called Corsia – the Carbon Offsetting and Reduction Scheme for International Aviation), though the problems inherent to offsetting mean it will never solve aviation’s climate problem. Yet airlines are pushing for this to be the only measure in place.

What governments need to do 

So governments have a choice to make. Because, unlike individuals, who have limited choice and limited power, the options for governments are practically endless. They can tax, invest, ban, restrict, order and command. That’s why we have electric vehicles and clean power – because the power of the state was used to bend markets and drive innovation.

Offsetting by individuals is, at worst, ineffective.

Governments implementing offsetting schemes is something much worse – a distraction from effective policies that can actually reduce aviation emissions. 

European Commission president Ursula von der Leyen and her new team seem to understand this. The European Green Deal makes no reference to aviation offsetting, but instead focuses on policies such as kerosene taxation, emissions trading and new fuels. All these have the potential to really cut emissions.

The test is whether she is able to follow through on these big promises. Some industries will try to distract focus by continuing to flog offsetting but VdL must continue to avoid such futile ideas. She has the political capital and the public demand to take real measures to cut aircraft emissions. Now is the time to act.

https://www.transportenvironment.org/newsroom/blog/airline-offsetting-distraction-policies-can-actually-reduce-emissions

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See also

 

EU study shows most carbon offsets do not work – aviation sector plans depend on them

Carbon offsets are not working, according to a study by the European Commission. The concept of carbon offsets is to allow polluters to pay others to reduce their CO2 emissions, so they can continue to pollute. This is usually considered the cheapest (“most cost effective”) way to make token gesture carbon cuts. The EC research found that 85% of the offset projects used by the EU under the UN’s Clean Development Mechanism (CDM) failed to reduce CO2 emissions.  EU member states decided not to allow the use of offsets to meet European climate goals after 2021. The global market-based measure adopted last October by ICAO relies exclusively on offsetting in its attempt at “carbon neutral growth” for aviation from 2020. Yet Europe is now endorsing the approach at ICAO to address international aviation emissions using the same approach that this report so thoroughly discredits. The problem with offsets is that they are often not making the CO2 cuts suggested, or that the cuts would have happened anyway.  To make matters worse, the ICAO agreement so far fails to include important safeguards which would exclude the worst types of offsets eg. forestry credits, or ensuring adequate transparency about the offsets used. With CDM offsets trading for as little as €0.50 a tonne, offsetting will not cut CO2 – nor will it incentivise greater aircraft efficiency. 

http://www.airportwatch.org.uk/2017/05/eu-study-shows-most-carbon-offsets-do-not-work-aviation-sector-plans-depend-on-them/

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Offsetting by passengers on flights won’t get us to net zero, says AEF in response to government offsetting consultation

The Department for Transport’s held a consultation “Carbon offsetting in transport: a call for evidence” which closed on 26th September.  The consultation outlined a proposal to require all air travel providers and other providers of ticketed travel to give passengers the option to buy a carbon offset for their journey. The Aviation Environment Federation did a response, in which they agree with the CCC’s view that “the UK should not plan to meet is climate change obligations using international offset credits.” They also agree with the EU’s decision to exclude international offsets from its ETS. There are few good quality carbon offsets available, and very few deliver CO2 reductions beyond what would have happened anyway. In the not-too-distant future, when all countries and sectors are cutting their emissions, there will not be many spare credits available. AEF say: “But a key argument against offsetting is that it risks distracting from the need to rein in aviation demand in order to tackle emissions.” People think that having bought a cheap offset for a few ££s means that’s all OK, and they can book another flight.  It delays real cuts in aviation emissions, that can only be achieved by the industry not expanding. 

http://www.airportwatch.org.uk/2019/10/offsetting-by-passengers-on-flights-wont-get-us-to-net-zero-says-aef-in-response-to-government-offsetting-consultation/

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Flybe saved after ministers agree a government loan + deferral of APD, and review of APD on domestic flights

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Flybe saved after ministers and investors seal rescue deal

Treasury’s pledge of tax review and delayed HMRC bill reportedly pushes shareholders to commit more cash

The immediate future of Flybe was secured on Tuesday night after ministers agreed a rescue deal with shareholders to keep Europe’s largest regional carrier flying.

 

The package of measures includes a potential loan in the region of £100m and/or a possible short-term deferral of a £106m air passenger duty (APD) bill, plus a pledge to review taxes on domestic flights before the March budget.

After the spectre was raised of another UK airline failure, Flybe’s owners Connect Airways – a consortium led by Virgin Atlantic – were persuaded to commit millions more to cover ongoing losses.

The government is still in negotiations to finalise any loan to Flybe, and although Treasury sources denied reports that it had agreed to defer outstanding APD, it is understood that HMRC could allow the airline a short-term extension to settle its debt.

The deal was condemned by British Airways’ owner IAG as “a blatant misuse of public funds”. Chief executive, Willie Walsh, accused Virgin of “wanting the taxpayer to pick up the tab for their mismanagement of the airline”.

Any government loan would also attract EU commission scrutiny for breaching state aid. However, the EU approved loans made last September by the German government to save Condor, a subsidiary of the Thomas Cook Group, when the UK allowed its sister airline to go bust.

The Treasury will also face the wrath of environmental groups after it announced a review of APD, a tax that adds £26 per passenger to all Flybe domestic return flights, to “ensure regional connectivity is strengthened while meeting the UK’s climate change commitments to meet net zero by 2050”.

An additional review has been promised to examine how else regional transport connectivity can be improved. The Treasury said: “In light of these discussions Flybe have confirmed they will continue to operate as normal, preserving flights to airports such as Southampton, Belfast and Birmingham.”

Long-haul flights from Northern Ireland are exempt from APD, as well as departures from remote parts of Scotland.  

The chancellor, Sajid Javid, said: “I welcome Flybe’s confirmation that they will continue to operate as normal, safeguarding jobs in UK and ensuring flights continue to serve communities across the whole of the UK.

“The reviews we are announcing today will help level up our economy. They will ensure that regional connections not only continue but flourish in the years to come – so that every nation and region can fulfil its potential.”

Lucien Farrell, chairman of Connect Airways – the parent company of Flybe – said: “We are very encouraged with recent developments, especially the government’s recognition of the importance of Flybe to communities and businesses across the UK. As a result, the shareholder consortium has committed to keep Flybe flying with additional funding alongside government initiatives.”

Flybe’s chief executive, Mark Anderson, said: “Flybe is made up of an incredible team of people, serving millions of loyal customers who rely on the vital regional connectivity that we provide. This is a positive outcome for the UK.”

The transport secretary, Grant Shapps, said his department would undertake “an urgent review into how we can level up the country by strengthening regional connectivity”. He said it would look at all the options to ensure airports could continue to play an important role in driving economic growth.

The deal came after a day when the prime minister, Boris Johnson, pledged that the government was “working very hard to do what we can” for Flybe and avert a further airline collapse so soon after Thomas Cook. The Conservatives had committed in their manifesto to improve regional connectivity.

The pilots union, Balpa, welcomed the news. General secretary Brian Strutton said: “This is good news for 2,400 Flybe staff whose jobs are secured and regional communities who would have lost their air connectivity without Flybe.

“The government is to be applauded for stepping up to the plate to help one of the few remaining independent UK airlines and a vital one at that.”

The company’s pleas for help to survive the winter came less than a year after it was taken over by a consortium led by Virgin Atlantic, with Stobart and Cyrus Capital, after posting recurring losses of around £20m per year.

Flybe has long struggled financially, and the fall of sterling since the 2016 EU referendum has piled additional pressure on UK airlines, with major costs such as fuel incurred in US dollars.

The airline has argued it is particularly hard-hit by APD, which is charged on each passenger on a flight taking off in the UK. While all short-haul economy flights, including domestic, are charged at the same rate – £13 – the tax is applied to each leg of a domestic return flight. That means, for example, that a return Flybe flight from Cardiff to Manchester is taxed at £26, while the duty on a Glasgow to Malaga return costs half that.

Potential moves to ease APD were condemned by environmental groups. The MEP for South West England – a constituency that includes Flybe’s Exeter home – Molly Scott Cato of the Green party, said it was “absurd to suggest that we should provide a further boost to the aviation industry”. She highlighted that routes deemed socially necessary could be subsidised under EU rules – Flybe’s Newquay to London route is already funded with state aid.

Greenpeace UK’s chief scientist, Doug Parr, said: “The government cannot claim to be a global leader on tackling the climate emergency one day, then making the most carbon-intensive kind of travel cheaper the next. Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need if we’re to cut climate-wrecking emissions from transport.”

Flybe flights were operating as normal on Tuesday.

https://www.theguardian.com/business/2020/jan/14/flybe-saved-after-successful-last-ditch-talks

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More on APD – from AirportWatch:

1. APD was introduced in 1994 by Ken Clarke, the then Chancellor of the Exchequer, not as an environmental tax but because he considered the aviation industry to be lightly taxed compared to other sectors, largely arising from its exemption from fuel duty and VAT.

2. It was initially set at £5.00 for short haul economy travel, which accounts for more than three quarters of all air travel. In 1997 Ken Clarke doubled APD to £10.00 for short haul economy flights.

3. Gordon Brown halved the short haul economy rate of APD in 2001, put it back up again to
£10.00 in 2007 and Alistair Darling raised it to £11.00 in 2009. George Osborne increased it to £12.00 in 2010. There was no increase in 2011 but it was raised to £13.00 in April 2012. Thus, for the vast majority of passengers APD has increased by just £3.00 (30%) over the past 15 years.

4. APD is payable only on departure from a UK airport and so the basic Band A rate of £13.00 is for a round trip to an overseas destination. APD is however payable on both legs of a domestic round trip within the UK.

5. APD raised £2.6 billion for public finances in 2011/12 and this is planned to increase to £3.9 billion by 2015/16. APD would, however, need to rise to four times its current level to offset the value of the industry’s exemption from fuel duty and VAT. If airlines paid the same level of fuel duty and VAT as road users, the cost to the aviation industry would be around £10.5 billion a year.

6. Not only do airlines pay no VAT on fuel, they are exempt from VAT on everything they buy
relating to the provision of air transport services. Mostly, VAT is not charged in the first place; aircraft and aviation fuel, for example, are zero rated. However, where VAT is charged, the airlines claim this back and in 2010/11, HMRC paid UK airlines a VAT rebate of £583 million (net).

See more at  http://www.airportwatch.org.uk/air-passenger-duty/ 

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See earlier: 

Flybe saved after ministers agree a loan and deferral of APD, and review of APD on domestic flights

The immediate future of Flybe was secured on 14th January evening, after ministers agreed a rescue deal with shareholders to keep the loss making regional airline flying.  The package of measures includes a potential loan in the region of £100m and/or a possible short-term deferral of a £106m air passenger duty (APD) bill to the Treasury, to help it sort out its debts Also a pledge to review APD on domestic flights before the March budget. Flybe’s owners Connect Airways – a consortium led by Virgin Atlantic – were persuaded to commit millions more to cover ongoing losses. The government is still in negotiations to finalise any loan to Flybe.  The deal was condemned by IAG as “a blatant misuse of public funds” and Virgin “wanting the taxpayer to pick up the tab for their mismanagement of the airline”. Moves to cut APD on domestic flights are totally at odds with any serious attempt to cut CO2 emissions from aviation, as most UK domestic trips can be made on (lower CO2) rail routes. Air travel is already subsidised, by paying no VAT or fuel duty. Some routes deemed socially necessary could be subsidised under EU rules – Flybe’s Newquay to London route is already funded from taxpayers.

Click here to view full story…

Any plans by UK government to remove APD on domestic flights would be unhelpful on CO2 emissions

Responding to the news that Boris Johnson’s Tory government is considering dropping all APD on domestic flights (just cutting it for Flybe would not be legal, for competition reasons) groups that understand about the need for cuts in carbon emissions reacted with dismay (to put it politely). Doug Parr, chief scientist at Greenpeace, commented: “This is a poorly thought out policy that should be immediately grounded.  The Government cannot claim to be a global leader on tackling the climate emergency one day, then making the most carbon-intensive kind of travel – flying – cheaper the next. Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need if we’re to cut climate-wrecking emissions from transport. The aviation sector has got away for years with increasing its carbon footprint. The last thing we need is another incentive for them to pollute more.”  Caroline Lucas commented on Twitter: “Addressing #Flybe problems by reducing #APD on all domestic flights is utterly inconsistent with any serious commitment to tackle #ClimateCrisis. Aviation already subsidised – no tax on fuel. Domestic flights need to be reduced, not made cheaper.”  Jenny Bates at Friends of the Earth said on Twitter: “APD cut on domestic flights would be “unacceptable & reckless” ⁦we at  @friends_earth ⁩ say-we must cut aviation emissions not encourage them.”

Click here to view full story…

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Any plans by UK government to remove APD on domestic flights would be unhelpful on CO2 emissions

Responding to the news that Boris Johnson’s Tory government is considering dropping all APD on domestic flights (just cutting it for Flybe would not be legal, for competition reasons) groups that understand about the need for cuts in carbon emissions reacted with dismay (to put it politely). Doug Parr, chief scientist at Greenpeace, commented: “This is a poorly thought out policy that should be immediately grounded.  The Government cannot claim to be a global leader on tackling the climate emergency one day, then making the most carbon-intensive kind of travel – flying – cheaper the next. Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need if we’re to cut climate-wrecking emissions from transport. The aviation sector has got away for years with increasing its carbon footprint. The last thing we need is another incentive for them to pollute more.”  Caroline Lucas commented on Twitter: “Addressing #Flybe problems by reducing #APD on all domestic flights is utterly inconsistent with any serious commitment to tackle #ClimateCrisis. Aviation already subsidised – no tax on fuel. Domestic flights need to be reduced, not made cheaper.”  Jenny Bates at Friends of the Earth said on Twitter: “APD cut on domestic flights would be “unacceptable & reckless” ⁦we at  @friends_earth ⁩ say-we must cut aviation emissions not encourage them.”
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The BBC’s Roger Harrabin commented on Twitter: 

“Is #APD punitive? Well, @aapresident  says you pay £13 in APD to fly from Newquay to Newcastle – and £35 in tax to drive… @The_AEF @CBI_CC “

and

Cutting #APD will exaggerate the price advantage of planes over trains. Here’s a test for @BorisJohnson  ’s commitment to #net zero emissions. @BusinessGreen @AviationWeek @friends_earth  @GreenpeaceUK  @thegwpf  @transenv  @HACAN1

 

See also

Government considering UK APD cut to save loss-making airline Flybe – to boost profitability of domestic flights

Flybe is one of the main airlines that fly domestic routes in the UK – 38% of them. Currently air passengers pay £26 APD on a return domestic flight (and £13 on a return flight to a European airport). Flybe has been struggling for years, as many of its routes are not profitable. It said in October that it recognised, with growing awareness of the higher CO2 emissions from a flight that using the train or coach, (and “flight shame”) that some of the domestic routes should be scrapped. Now Flybe cannot pay its APD bill to the government – about £100 million over three years. So the government, which talked up the importance of regional connectivity before the election, is considering removing APD from all domestic flights. That would be entirely the opposite of what is needed, to tackle UK carbon emissions, and those from UK aviation in particular. Aviation is already subsidised by not paying VAT. The loss to the Treasury from cutting domestic APD would have to be made up by  taxation from other sources. It is not as if all domestic flights are vital to the economy. Most are leisure passengers, making trips to visit places or people, friends or family.

Click here to view full story…

 

and

Boris Johnson says Flybe key for UK’s ‘connectivity’ as Government weighs up air passenger duty cut

14.1.2020 (The Telegraph)

Boris Johnson has said Flybe plays an important role in “delivering connectivity across the whole UK” amid reports the Government could cut air passenger duty on all domestic flights to help rescue the struggling airline.

The Prime Minister declined to reveal details of discussions with the struggling airline, but said: “We’re working very hard to do what we can, but obviously people will understand that there are limits to what a government commercially can do to rescue any particular firm.

“It’s not for government to step in and save companies that simply run into trouble, but be in no doubt that we see the importance of Flybe in delivering connectivity across the whole UK,” Mr Johnson told the BBC.

His comments came after the BBC reported the Government was considering cutting air passenger duty for all domestic flights, which would allow Flybe to defer payments due to the government and devise a rescue plan that would save more than 2,000 jobs.

Chancellor Sajid Javid will meet representatives from the business and transport departments to discuss APD and possibly deferring Flybe’s bill.

A possible deal could allow Flybe to defer a payment of more than £100m for three years, Sky News reported.

Under the plan, Flybe’s owners would be required to invest tens of millions in fresh equity into the company as a condition of any deal.

Flybe’s flights appeared to be operating as normal on Tuesday, a day after reports emerged suggesting it needed to quickly raise new funds to help it survive through the winter when demand for travel is lower.

That has heaped pressure on Mr Johnson’s government, which won seats in regions served by Flybe, helped by a promise to improve connectivity between UK cities outside the South East.

Flybe’s network of routes include more than half of UK domestic flights outside London.

Based in Exeter, it connects smaller cities such as Southampton to Newcastle and carries eight million passengers a year between 71 airports in the UK and Europe.

APD is a tax of at least £13 levied by the Government on passengers departing from UK airports, which the aviation industry has long opposed as making them less competitive compared with European rivals.

Flybe has argued that the tax disproportionately affects it, making its flights more expensive compared to its rail and road competitors, because passengers travelling on return flights within the UK will pay it twice.

The DfT and Flybe declined to comment, while the Treasury could not immediately be reached for comment.

If the Government does cut APD for domestic UK flights, other airlines such as easyJet and British Airways, which fly routes such as London to Edinburgh, would also benefit.

Flybe has 68 aircraft and about 2,000 staff and was already struggling financially when it was bought by Connect Airways, a consortium created by Virgin Atlantic, Stobart Group and investment adviser Cyrus Capital for $2.8m (£2.16m) last year.

The airline, due to be rebranded Virgin Connect later this year, has suffered as the fuel price has risen in recent months, and news stories about its demise could cause a cash flow squeeze as potential customers stop booking.

Should Flybe collapse, it would be the second high-profile failure in Britain’s travel industry in less than six months after Thomas Cook went into liquidation last September, stranding thousands of passengers.

That followed the collapse of UK holiday airline Monarch in 2017 and Flybe competitor FlyBMI last year.

https://www.telegraph.co.uk/business/2020/01/14/government-consider-cutting-air-passenger-taxes-save-struggling/

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Read more »

Government considering UK APD cut to save loss-making airline Flybe

Flybe is one of the main airlines that fly domestic routes in the UK – 38% of them. Currently air passengers pay £26 APD on a return domestic flight (and £13 on a return flight to a European airport). Flybe has been struggling for years, as many of its routes are not profitable. It said in October that it recognised, with growing awareness of the higher CO2 emissions from a flight that using the train or coach, (and “flight shame”) that some of the domestic routes should be scrapped. Now Flybe cannot pay its APD bill to the government – about £100 million over three years. So the government, which talked up the importance of regional connectivity before the election, is considering removing APD from all domestic flights. That would be entirely the opposite of what is needed, to tackle UK carbon emissions, and those from UK aviation in particular. Aviation is already subsidised by not paying VAT. The loss to the Treasury from cutting domestic APD would have to be made up by  taxation from other sources. It is not as if all domestic flights are vital to the economy. Most are leisure passengers, making trips to visit places or people, friends or family. 
.

See also

 

Any plans by UK government to remove APD on domestic flights would be unhelpful on CO2 emissions

Responding to the news that Boris Johnson’s Tory government is considering dropping all APD on domestic flights (just cutting it for Flybe would not be legal, for competition reasons) groups that understand about the need for cuts in carbon emissions reacted with dismay (to put it politely). Doug Parr, chief scientist at Greenpeace, commented: “This is a poorly thought out policy that should be immediately grounded.  The Government cannot claim to be a global leader on tackling the climate emergency one day, then making the most carbon-intensive kind of travel – flying – cheaper the next. Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need if we’re to cut climate-wrecking emissions from transport. The aviation sector has got away for years with increasing its carbon footprint. The last thing we need is another incentive for them to pollute more.”  Caroline Lucas commented on Twitter: “Addressing #Flybe problems by reducing #APD on all domestic flights is utterly inconsistent with any serious commitment to tackle #ClimateCrisis. Aviation already subsidised – no tax on fuel. Domestic flights need to be reduced, not made cheaper.”  Jenny Bates at Friends of the Earth said on Twitter: “APD cut on domestic flights would be “unacceptable & reckless” ⁦we at  @friends_earth ⁩ say-we must cut aviation emissions not encourage them.”

Click here to view full story…

 

Flybe: UK air passenger duty cut considered to save airline

14.1.2020 (BBC)

Prime Minister Boris Johnson has told the BBC there is “no doubt” about the importance of regional airline Flybe.

The carrier’s network includes more than half of UK domestic flights outside London.

The government is to consider cutting air passenger duty on domestic flights as part of a plan to save the airline from collapse.

However, environmental groups said such a move would be “reckless” given the need to prevent climate change.

Why is Flybe so important?

The prime minister told the BBC that it was “not for government” to step in and save companies that run into trouble.

But he added: “We see the importance of Flybe in delivering connectivity across the whole of the United Kingdom.”

The airline carries about eight million passengers a year from airports including Birmingham, Manchester, Southampton, Belfast City, Cardiff and Aberdeen, to the UK and Europe.

Tim Jeans, chairman of Cornwall Airport, said Flybe was “very important not just to our airport but to regions, to nations and to island communities across the UK”.

“They provide lifeline services to destinations across the rest of the UK that simply are not replicated by either other airlines or convenient and affordable train services.”

Flybe flight share

 

Regular Flybe passengers have also expressed their concern, with many describing its routes as “vital”.

Nick Lake, 39, who works for a property development company, said he uses Flybe at least once a week to fly between Manchester and Edinburgh and “would be devastated if they went under”.

What is the government considering?

The UK government is considering a cut to air passenger duty (APD) to help the Exeter-based company.

The change would allow Flybe to defer its tax bill, design a rescue plan, and secure more than 2,000 jobs.

Improving connectivity outside of London was a key Conservative manifesto pledge and at least one of Flybe’s routes, between Newquay and London, is subsidised by the government.

Flybe graphic

 

Sky News reported that the possible deal over air passenger duty could see Flybe defer a payment of more than £100m for three years.

By applying the move to the whole industry, the government would avoid breaching EU state aid rules.

It’s also thought any Flybe turnaround plan would be financed by a consortium led by Sir Richard Branson’s Virgin Atlantic, which rescued the airline a year ago.

Virgin Atlantic, Southend Airport-owner Stobart Group and hedge fund Cyrus Capital Partners paid £2.8m for the airline and agreed to invest £100m in the loss-making business.

Flybe has refused to comment on talks over a rescue.

What is air passenger duty?

Air passenger duty (APD) is charged on all passenger flights from UK airports, excluding the Scottish Highlands and Islands region.

The amount depends on the destination and class of travel.

Under current rules, passengers on domestic flights pay £13 in APD for a single journey, with higher rates for longer flights and premium cabins.

Flybe is a long-time critic of APD, which it says disproportionately burdens its domestic customers because they have to pay it each time they take off from a UK airport.  [APD is just £13 for any adult on any short-haul return trip in Europe  – under 2,000 miles.  It is charged on passengers leaving a UK airport. So it is charged twice – £26 – on domestic flights, as both involve leaving a UK airport. AW comment]

Changes to air passenger duty could reduce the billions of pounds the charge generates for the government, which is expected to reach £3.7bn this financial year, according to Office for Budget Responsibility.

What do climate change activists think?

Doug Parr, chief scientist at environmental campaign group Greenpeace, said cutting air passenger duty would be “a shocking decision”.

He said:

“This is a poorly thought out policy that should be immediately grounded.  The Government cannot claim to be a global leader on tackling the climate emergency one day, then making the most carbon-intensive kind of travel – flying – cheaper the next.

“Cutting the cost of domestic flights while allowing train fares to rise is the exact opposite of what we need if we’re to cut climate-wrecking emissions from transport.
The aviation sector has got away for years with increasing its carbon footprint. The last thing we need is another incentive for them to pollute more.”

Jenny Bates, a campaigner for the Friends of the Earth charity, told the BBC any cut to air passenger duty would be “reckless”.

Ms Bates said: “These short UK trips are exactly the ones we need to avoid in the drive to cut aviation climate emissions needed to prevent climate breakdown.

“Instead the government could invest more in our rail system, helping make such trips more affordable.”

Is there another solution?

Former transport secretary and Labour peer Lord Adonis said that if the tax was cut, it was likely that general taxes would have to be raised to make up for the lost revenue.

He added: “There may be a case for subsidising more routes. If they are vitally necessary there is a case for subsidising them… but not to give Virgin and BA a free lunch at the expense of the general tax payer.”

BBC business editor Simon Jack said a cut to air passenger duty could create what Boris Johnson has previously described as a “moral hazard” – a dangerous precedent that would lead struggling companies to believe they could rely on the government to help them if they got into financial difficulties.

…. and it continues about passengers’ rights….

https://www.bbc.co.uk/news/business-51100029

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Government working ‘very hard’ to save Flybe, says PM as ministers ‘prepare to discuss rescue package’

13.1.2020 (ITV)

The government is “working very hard” on Flybe’s rescue, the prime minister has said ahead of reported ministerial meetings which will evaluate what can be done to save the struggling airline.

Boris Johnson declared it was not for government “to step in and save companies that simply run into trouble” but admitted the company has an integral role in “delivering connectivity across the whole United Kingdom”.

It is reported Chancellor Sajid Javid, Business Secretary Andrea Leadsom and Transport Secretary Grant Shapps will meet to discuss whether a £100 million tax payment can be deferred until 2023, according to Sky News.

It was reported that the deal would be conditional on Flybe’s three shareholders pumping tens of millions of pounds into the loss-making carrier.

“We’re working very hard to do what we can, but obviously people will understand that there are limits, commercially, to what a government can do to rescue any particular firm,” Mr Johnson told the BBC.

“But what we will do is ensure that we have the regional connectivity that this country needs.”

https://www.itv.com/news/2020-01-13/cabinet-ministers-to-discuss-flybe-rescue-package/

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See earlier:

‘Flight shame’ could lead Flybe to cut domestic routes

18 Oct 2019

by Alex McWhirter (Buying Business Travel)

As readers will know Flybe has cancelled and/or suspended a number of routes in recent weeks.

Several readers have told me that these cuts had been announced months ago. In truth these changes are being made in addition to the cuts announced last spring.

Now comes news from the new CEO of Flybe (soon to be rebranded Virgin Connect) that the future of certain domestic routes is in doubt.

Devonlive.com reports that CEO Mark Anderson says that Flybe could stop flying between (domestic) airports where the journey could be made easily by train or car.

Interviewed on Thursday by PA news agency the CEO said:

“We need to be responsible. Maybe there are some routes in the future, as I look at the future of Virgin Connect and how we’re connecting people to the world, that we will potentially not fly.”

“We will potentially say ‘Actually this makes more sense by train or this makes more sense by road.’ And maybe in the future we’ll get behind that as well.”

Routes under threat, because of good train links, might include Birmingham to Edinburgh and Glasgow and Exeter to London City.

Any changes made to the latter route will not go down well with Exeter’s weekly commuters to London as we reported earlier this week.

Flybe has already said it will cease flights between Manchester and Glasgow towards the end of this month, while it’s unlikely the former Cardiff-London City service will ever return … even though much requested by Welsh customers.

In other news Flybe and Scotland’s Loganair have said they will enter into a cooperation agreement on Anglo-Scottish routes.

Travellers will be able to buy through tickets (for the entire journey) and through-check their luggage.

Buying a through ticket means travellers will be looked after should the connection be missed. They will also have the ability to through-check luggage, and will make APD savings as the duty is payable once, not twice.

https://www.businesstraveller.com/business-travel/2019/10/18/flight-shame-could-lead-flybe-to-cut-domestic-routes/

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