REFILE-Carbon-offset deal seen costing airlines up to $6.2 bln in 2025

(Corrects to remove "IATA" from headline, adds "citing ICAO
figures" to first paragraph to clarify IATA cited ICAO data)
By Allison Lampert
MONTREAL, May 10 (Reuters) - A global market-based measure
to curb aviation emissions would cost the airline industry up to
$6.2 billion in the year 2025, but carriers could face higher
charges if governments fail to reach a deal by October, the
International Air Transport Association said, citing ICAO
figures.
Government representatives are gathering Wednesday at the
International Civil Aviation Organization to negotiate a draft
deal on carbon-neutral growth from 2020 which is to be voted on
at a fall assembly.
"That of course is the result the industry is counting on,"
IATA Chief Executive Tony Tyler told participants at a global
sustainable aviation forum in Montreal on Tuesday, in reference
to the draft deal.
By 2035, the deal would cost airlines up to an estimated $24
billion, as air traffic grows, according to figures from the
Montreal-based International Civil Aviation Organization, or
ICAO.
The cost projections are for sample years after the deal
would become active in 2021.
Airlines are nevertheless urging ICAO's 191-member states to
reach a global agreement in the fall because the cost of a
patchwork of national and regional agreements could be even
higher.
"A market-based cost will be much more efficient, and much
fairer than the alternative which is a patchwork of inefficient
and ineffective charges and taxes which are cooked up primarily
just to raise cash rather than to tackle climate change," Tyler
said. "We expect that the cost will be not insignificant, but it
will be manageable."
According to ICAO data cited in an IATA position paper, the
estimated cost of offsetting a flight carrying 267 passengers
from Moscow to New York on a B777 would cost up to $804 in
offsets.
Aviation was not included in the global climate deal reached
at a U.N. conference in Paris in December, and ICAO is tasked
with nailing down a strategy to limit emissions after six years
of talks.
The plan would allow airlines to offset their emissions by
buying carbon credits from designated environmental projects
around the globe, but countries remain divided on how offset
obligations are shared between developing and developed states.
ICAO's proposed Carbon Offsetting Scheme for International
Aviation recommends bringing in the carbon offsets agreement in
phases to accommodate developing nations and exempting the
world's least-developed countries. But in a recent position
paper, China raised concerns that the deal would "impose
inappropriate economic burden on developing countries, where the
international aviation market is still maturing."