Carbon dioxide emissions from international aviation
are small but growing much faster than other
greenhouse gas emissions. To date, aviation emissions
have been excluded from climate policy, inter
alia because it is an international industry regulated
by consensus. Recently, however, the European
Commission has announced that aviation emissions
will be part of the European Trading System (ETS)
for carbon dioxide. Specifically, permits will be needed
for all emissions from flights from and to an airport
in the European Union.1 This note investigates
the implications for emissions, for travel patterns,
and for the financial position of airlines.