The government has been accused of 'betrayal' after it gave £300m of free ‘pollution permits’ to airline including British Airways, Ryanair and easyJet under a scheme designed to tackle climate change.
The UK’s Emissions Trading Scheme is meant to reduce carbon emissions by forcing big polluters to buy permits for each tonne of carbon they emit.
But data through freedom of information request reveals the UK’s aviation sector was handed more than four million “pollution permits” last year, free of charge.
The free permits allowed airlines to avoid the extra charges, which would have otherwise cost £336m when calculated against the annual average carbon price.
EasyJet, RyanAir and British Airways were the big winners of the handouts, bagging permits worth £84m, £73m and £58m respectively, data obtained by OpenDemocracy and shared with The Mirror shows.
Wera Hobhouse MP, the Liberal Democrat spokesperson for Climate Change, told The Mirror: “The Conservative Government has dragged their feet for years on using this scheme to tackle emissions from big polluters. In the mean time, we have lost crucial years of progress in tackling the climate emergency.:
She added that the move "shows a serious lack of judgement", adding: "This is nothing less than a betrayal of the British people who want to tackle this crisis.”
The value of the permits has shot up in the past year, increasing by 39% against the previous 12 months.
Finlay Asher, a former aerospace engineer at Rolls-Royce who left the industry to become a full-time climate campaigner, described the government's permit model as "inadequate and ineffective."
"We would instead prefer governments to deliver a roadmap of emissions pricing which increase every year and provides a clear price signal to aerospace manufacturers, airlines and airports to transform air travel via early design rather than late disaster," the Safe Landing founder told The Mirror.
Caroline Lucas, the Green MP for Brighton Pavilion, said that the government was letting companies "get away with it” and “forcing the public to pick up the tab”.
“Ministers must bring an end to these free pollution permits immediately, and make high-carbon companies pay for the climate-wrecking damage they’re causing,” Lucas added.
The Department for Net Zero and Energy Security is now analysing the results of a consultation on phasing out free permits for the aviation sector – but policy changes will not take effect until at least 2026.
The government has already allocated 12.2m free permits for the next three years, which at last year’s carbon price will be worth a further £965m.
A government spokesperson said that the UK was giving away free permits because it was “committed to tackling climate change” but also to “protecting our industry from carbon leakage”.
But the risk of carbon leakage – when companies relocate to countries that do not have carbon pricing – is “minimal”, according to research commissioned by the government itself.
A study by Frontier Economics on behalf of BEIS also found that ending permit giveaways would curtail profits: “If free allowances are phased out, under the assumptions used in this study it is likely that airline profitability (for both UK and non-UK airlines on UK ETS routes) will decrease.”
The giveaway of permits could also undermine competition, according to the research.
The remaining £120m in free permits was carved up the rest of the UK airline industry - with even the owners of private jets getting free handouts.
A Government spokesperson said: “The UK is committed to tackling climate change while protecting our industry from carbon leakage.
"That is why a proportion of allowances are allocated for free to businesses under the UK Emissions Trading Scheme (ETS).
“This will support industry in the transition to net zero in the context of high global energy prices while incentivising long term decarbonisation.”
A spokesperson for easyJet said: "All airlines operating to and from the UK receive a proportion of ETS credits. The amounts that are distributed to airlines by the Government for the UK ETS are set by law.
"In addition, easyJet regularly purchases a significant amount of additional ETS permits in order to ensure we cover all our applicable carbon emissions."
British Airways and Ryanair were contacted for comment.
