Europe’s Aviation Growth Threatened By Green Caps, New Taxes

Amsterdam Airport Schiphol
Credit: Amsterdam Airport Schiphol

Political pressure on airlines in Europe to limit flying on environmental grounds continued to mount during 2023 and looks set to intensify further in the year ahead.

The Dutch government’s effort to reduce the annual number of flights at Amsterdam Airport Schiphol (AMS) from 500,000 to 460,000—ostensibly to address noise complaints—was set to come into force from the 2024 northern summer season until an unexpected U-turn just days before the Netherlands’ general election in mid-November.

The decision to abandon the cap followed intense pressure from airlines, the European Commission (EC) and the US government, including an order from the US Transportation Department indicating that the capacity reduction would be “unfair, discriminatory and anti-competitive” for carriers.

IATA director general Willie Walsh made no bones about how much of a step down this was for the Dutch government.

“A balanced approach is enshrined in legal frameworks to manage noise while maintaining the benefits of aviation,” he said. “Four times the number of people are impacted by noise from rail versus air and 30 times the number are affected by noise from roads. There were a lot of things that the Netherlands government could have done about noise at Schiphol before cutting flights. It was highly embarrassing for the government to be forced to back down because of the opposition from the US DOT and the EC.”

However, while the push to limit flights at one of Europe’s busiest hubs may have diminished for now, the political appetite to curb domestic and short-haul flying to cut carbon emissions remains high. France introduced a ban on domestic flights where a train alternative exists last May, and similar proposals have been mooted in Spain.

“This could affect routes like Madrid-Barcelona and Madrid-Malaga,” said Patrick Edmond, managing director at consultancy firm Altair Advisory. “The proposals in Spain aren’t clear but the fact that this is another country where it is on the table is indicative of which way the wind is blowing.”

Allied to the threat of further flight restrictions, airlines and airports in Europe are grappling with even higher aviation taxes. The Netherlands has already voted to introduce a transit tax at AMS, while Denmark’s government is bringing in a tax on domestic and international services. The Danish tax could add up to $57 on the cost of a long-haul flight by the end of the decade. Ministers said revenues would support aviation’s green transition—although funds will also support pension increases for elderly citizens.

“There is broad confusion as to how this has come about or is justified,” David Surley, senior director route development at Aarhus Airport, said. “The EU already has robust green targets under its Europe-wide climate directive, so there are concerns about differing goals and objectives, where many in the industry believe an internationally aligned approach with economy of scale is optimal.”

David Casey

David Casey is Editor in Chief of Routes, the global route development community's trusted source for news and information.