Monday, 24 September 2012

Disingenuous Skies

Airbus has recently launched its ‘Smarter Skies’ vision of how aviation will look in 2050. There are some good ideas but the overall package is looking more disingenuous than smart.

Aviation is fighting hard to protect the status quo against the demands of environmentalists. In Europe, Airbus describes the situation on its website under the heading ‘The Environment and Air travel’:

‘Air travel is an invaluable global asset which is at the heart of today’s global economy. Therefore, safeguarding aviation’s economic & societal benefits is crucial. More than 56 million jobs and USD $2.2 trillion of global gross domestic product are supported by the air travel industry. The aviation industry’s global economic impact is 3.5 per cent of global GDP. If aviation were a country, it would rank 19th in size by GDP – approximately the size as Switzerland or Poland. Globally the aviation sector is expanding. Passenger demand doubles every 15 years and by 2050 it could be handling 16 billion passengers and 400 million tonnes of cargo annually. In the meantime, passengers have become increasingly mindful of the ecological impact of their travel choices.’

Four sentences before any mention of the environment, in a section specifically about the environment, is a peculiar way to present their case.

On the other side of the Atlantic, Boeing’s environmental report 2012 is more upbeat:

‘At Boeing, we are focused on creating cleaner, more efficient flight. Each new generation of products we bring to the marketplace is quieter, consumes less fuel and is better for the environment.’

This claim is referenced to the dawn of the jet age when we discovered how to pump fuel out the back and ignite it to produce thrust. Boeing omits to mention that only their newest planes match the fuel efficiency of the propeller driven airliners of the 1950s.

Policy makers should look outside the aviation industry, for advice and the policy choices available, as the industry is hell bent on defending an antiquated vision of aviation which has no place in the 21st century.

Tuesday, 18 September 2012

Increase VAT on Energy

“To help the transition to a low-carbon economy, VAT on gas and electricity should rise to 20%.”

This is what needs to be said and I will salute the politician who has the courage to say it.

The world shares the challenge of curing a dangerous addiction. Fossil fuel is something we feel that we cannot do without, despite the negative consequences and despite there being other ways to live our lives. Breaking the habit will be hard whilst we live in societies where addiction is regarded as normal. Realization is growing that burning fossil fuel is dangerous with potentially severe consequences over the long-term but that does not make it any easier to overcome the short-term craving for the next fix.

Across the world, governments subsidise fossil fuel out of political expediency, bowing to the demands of the fossil-fuel junkies. This is not quite as bad as subsidising pushers to keep the street price of heroin affordable, but the analogy is not entirely misplaced.  Higher prices for fossil fuel are a necessary precondition to force the transition way from its use. This underpins the business case for low-carbon energy generation and investment in efficiency measures as well as providing the means to cajole people into appropriate lifestyle change.

In the UK, VAT on gas and electricity is set at 5% compared with a general rate of 20%. This is in effect a subsidy, which becomes particularly invidious when you consider that, if the European Commission gets its way, VAT at the full rate will be charged on energy-saving materials used to insulate homes. It is high time that politicians removed this anachronism and raised VAT and gas and electricity to 20%. The logic is inescapable but the political fallout could be huge.

The way to sell this change of policy to a general public, concerned at how to pay for their next ‘fix’, is to focus on how the extra tax will be deployed. A cynic might argue it should be spent on whatever bribe will stifle dissent, but a more principled approach would be to focus on increasing investment in low-carbon public infrastructure and support for efficiency measure such as the insulation of homes of the less well off. The other way is just to do it, and face-down the political consequences, but such direct and decisive action does not fit with modern emasculated politics.

Monday, 10 September 2012

Government Stalls

UK plc needs a sound strategy for aviation but the government has stalled the process of locating one. Instead of taking a decision, it has set up a commission to examine the options and report after the next election. This is the oldest political trick in the book, putting short-term political expediency before the long-term planning needs of the country. It also makes David Cameron’s pledge to be ‘the greenest government ever’ look increasingly threadbare.
‘Green’ was never going to be an easy objective when policy has to be economically literate and commercially viable but green means giving equal weight to the needs of society and effective stewardship of the environment.

Aviation policy is not about this electoral term, or the next, it has to be about the nature and shape of aviation through the course of the 21st century. It is much more than a decision about extra runways serving the South East of England; aviation policy requires a complete reappraisal of aviation and its role in society and the economy. We have all the facts and data needed to make a decision about coherent policy that deals with people’s aspirations, the needs of the economy and the pressing need to control emissions.

It can be done; let’s do it.

Sunday, 2 September 2012

Prowl and Pounce

Last week, the UK Prime Minister was taunted by Tim Yeo MP as to whether he is a man or a mouse in relation to making a decision over a third runway for Heathrow. This week I would like to challenge the UK government on the same issue with another animal metaphor. Is the UK government a flock of sheep or a pride of lions? When I observe the government dealing with aviation policy – shifting this way then that, one moment influenced by environmental policy and the next responding to demands from the business lobby – it looks like a flock of sheep without a sense of direction. I would like to see government acting like a pride of lions, eyeing up the possibilities and then going in for the kill.
Aviation is affected by a range of issues; at the core are two sets of predictions. First, aviation is predicted to grow substantially and this is presented as vital to the economy to ensure that the UK remains well connected to the global market. Second, the emissions from aviation are predicted to grow exponentially increasing their contribution to climate change. The government is torn between supporting growth to help the economy and controlling emissions to counter climate change. It wants to do both, of course, but in the blinkered world of conventional narrow economic analysis it is seen as one or the other. The flock of sheep rushes from one side of the field to the other depending on which lobby group, or focus group, is shouting loudest at the time. The result is procrastination and a policy vacuum which serves no one.

 A pride of lions would prowl around the issues and decide where to attack before pouncing. The argument from economists – that we need more conventional aviation – is a distraction. The prey to hunt down is the blockage that prevents the development of green aviation (within a sustainable economy). In hunting down the problem, it is worth scanning the bigger picture. Conventional aircraft will continue to have a role for many decades but conventional flying will become much more expensive, leading to much reduced capacity (and much reduced emissions).  This part of the new landscape for aviation is clear; the other side of the argument – as to what will evolve to satisfy the demand for low-cost air travel – is much more interesting. New designs of air vehicles that are slower and more efficient will come off the drawing board into development and deployed into the fleets. These will need different ground handling facilities, so planning airport capacity is not simply about numbers of terminals and runways but requires a fundamental rewrite of the design codes for airports.
None of this will happen whilst the old economic model of growth based on tax-free fuel dominates aviation. The lions should single out the weakest link in the herd of issues and circle around the blockage in international politics, and pounce, taking down the tax exemption for aviation fuel. The problem moves from an impossible dilemma into a difficult but workable transition to sustainable aviation.
I hope the Prime Minister proves to be a man and not a mouse, and his government lions not sheep.