![handle is hein.congrec/cbo10834 and id is 1 raw text is: CONGRESSIONAL BUDGET OFFICE
COST ESTIMATE
August 1, 2012
S. 1956
European Union Emissions Trading Scheme Prohibition Act of 2011
As ordered reported by the Senate Committee on Commerce, Science,
and Transportation on July 3], 2012
The European Union (EU) has established the European Union Emissions Trading Scheme
(ETS), a regulatory framework related to greenhouse gas emissions. Currently, the ETS
covers emissions from air carriers that operate flights within, to, and from EU member
states. Negotiations between the U.S. government and the EU about the applicability of the
ETS to U.S. air carriers are ongoing, and the potential outcome of those negotiations is
unclear.
S. 1956 would direct the Secretary of Transportation to prohibit U.S. air carriers from
participating in the ETS if the Secretary believes such a prohibition to be in the public
interest. The bill would direct federal agencies to continue negotiations in pursuit of a
worldwide approach to addressing aviation-related emissions and would authorize the
Secretary to use existing authorities to ensure that U.S. air carriers are held harmless for
any costs they incur if they participate in the ETS.
CBO estimates that enacting S. 1956 would have no significant impact on the federal
budget. We expect that the bill would not alter the scope of diplomatic efforts currently
underway or federal agencies' costs to participate in those efforts, which are subject to
appropriation. The bill would not affect direct spending or revenues; therefore,
pay-as-you-go procedures do not apply.
S. 1956 contains no intergovernmental mandates as defined in the Unfunded Mandates
Reform Act (UMRA) and would not affect the budgets of state, local, or tribal
governments.
5. 1956 would impose a private-sector mandate, as defined in UMRA, if U.S. air carriers
would be prohibited from participating in the ETS. The cost of the mandate would depend
on how the prohibition is administered by the Department of Transportation. Because
information about how the prohibition would be implemented is not available, CBO has no
basis for estimating the cost, if any, to U.S. air carriers. Consequently, CBO cannot
determine whether the cost of the mandate would exceed the annual threshold established
in UMRA for private-sector mandates ($146 million in 2012, adjusted annually for
inflation).](ViewImageLocal?handle=hein.congrec/cbo10834&div=1&collection=&method=preview&ext=.png&size=3)
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