Swiss Emissions Trading Scheme
Switzerland has decided to include carbon emissions from aviation into the Swiss Emissions Trading Scheme (ETS) to prepare for the future linking of Swiss and EU ETS. As a first step, it adopted the so called tkm-Ordinance which requires certain aircraft operators to disclose distance and payload information for flights falling under the scope of Swiss ETS. This information is used to determine the number of emission allowances that will be distributed free of charge to participating aircraft operators. As with EU ETS, aircraft operators will eventually need to report on their emissions. They will be able to use the free emission allowances to offset their emissions from the first monitoring year – most likely 2020.
What is Swiss ETS?
The Swiss ETS is a cap-and-trade system designed largely in accordance with the same principles and rules governing its bigger brother the EU Emissions Trading System. It regulates a total of 56 CO2-intensive companies from the cement, chemicals and pharmaceuticals, refineries, steel, paper, district heating and other sectors. The newest addition are carbon emissions from flights that fall within the scope of Swiss ETS. The illustration below tells you which flights these are.
* The EEA comprises all 28 EU Member States, as well as Iceland, Liechtenstein and Norway. List of EU Member States: Austria, Belgium, Bulgaria, Cyprus, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, United Kingdom.
Who must participate?
Both Swiss based and foreign aircraft operators must participate in the Swiss ETS unless they are exempt. Participation means first of all the submission of a tonne-kilometre monitoring plan.
You are required to submit a tonne-kilometre monitoring plan if you had any surrendering obligations under EU ETS in 2016 and cannot rule out to operate flights under the scope of Swiss ETS in 2018. By contrast, you are exempt if you had no surrendering obligations under EU ETS in 2016 unless you are above the Swiss de minimis threshold (see definition below) in 2016.
A commercial operator is above the de minimis threshold if it operates more than 243 qualifying flights in any of the three successive four-month periods and if its total annual emissions of CO2 from all flights under the scope of Swiss ETS are above 10,000 metric tons.
A private, non-commercial operator exceeds the de minimis threshold if its total annual emissions of CO2 from all flights under the scope of Swiss ETS are above 1,000 metric tons.
The Swiss and EU ETS are identical when it comes to flight exemptions, such as flights performed by aircraft with a MTOW of less than 5,700 kg, circular flights or training flights. Click here, for the full list of flight exemptions.
It is also worth noting that emissions from these flight exemptions shall not be accounted for when determining your position relative to the de minimis threshold.
Participation in Swiss ETS also means the submission of a verified tonne-kilometre report for 2018 by 31 March 2019. You are exempt from the obligation to submit a verified tonne-kilometre report for 2018 if in 2018 you are below the exemption threshold (see above).
However, the exemption threshold only applies if you had no reporting obligations under EU ETS for 2016. So you are still required to participate in Swiss TKM reporting (even if you are below the exemption threshold) if you had to participate in EU ETS in 2016 and if you have at least one Swiss ETS relevant flight in 2018.
Obligations under the Swiss ETS?
Participating aircraft operators must:
- submit a tonne-kilometre monitoring plan to the Swiss Federal Office for the Environment (FOEN) by 30 September 2017
- monitor distance and payload information for qualifying flights in 2018 in accordance with the approved monitoring plan and the Swiss tkm-Ordinance
- submit a verified tonne-kilometre report for 2018 to the FOEN by 31 March 2019 unless you are exempt (see above)
Please note obligations for the monitoring, reporting and verification of emissions data and the surrendering of emission allowances are yet to be specified by the regulator.