| dc.description.abstract | Aviation accounts for approximately 2.5% of global CO2 emissions. However, this seemingly low number
is deceiving for several reasons. For one thing, it does not account for other warming effects of aviation,
and further, it does not show the increasing trend in carbon emissions from aviation during the last
decades. To reach global climate targets, policy adjustments for carbon emissions from aviation are more
than likely to be needed. In this study, we investigate the climate policy for aviation in the European Union
Emissions Trading Scheme (EU ETS). More specifically, we examine the potential carbon leakage that
can arise from removing the free allocation of emission allowances (EUA) for the aviation sector in the EU
ETS by 2026. To narrow down the scope of the study, we only analyze how the policy change would
affect demand changes for three charter destinations from Landvetter Airport, Gothenburg, and the
potential carbon leakage that could arise because of the demand changes. For the analysis, we use a
regression model, containing time series data on number of passengers and fuel costs as a proxy for
ticket prices, to estimate how variations in ticket prices affect demand for each destination. Using the
estimations together with predicted future costs of EUAs, we find a reduction in demand of 10 to 20% in
2026. To illustrate the potential carbon leakage, we employ four different scenarios of travel substitution
to a destination that is not affected by increased costs from EUAs, namely Antalya, Turkey, and find a
leakage of 1.7 to 6.9 million kg CO2. | sv |
