While air and noise pollution represent a small fraction of total aviation related costs, these issues are often very controversial and visible. Aircraft noise frequently becomes a key issue in airport construction and expansion debates, despite considerable improvements in technology that have made aircraft much quieter over recent decades. An attempt to include aviation into the EU Emissions Trading Scheme from 2012 has met considerable resistance from US and Asian governments, leading to the EU limiting application of ETS to aviation to only intra-EU services.

While being responsible for under 3 per cent of the global CO2 emissions, aviation receives more than its fair share of negative publicity for its contribution to the global greenhouse gas (GHG) emissions. On the other hand, the fact that aviation is one of the very few industries that have, at the global level, made clear commitments to reducing its carbon footprint, gets undeservedly overlooked.

Air and noise pollution, as well as greenhouse gas emissions are classic examples of negative externalities, just like congestion, which we discussed in Chapter 9. Therefore, mechanisms to tackle them include quantity restrictions and/or pricing. In this short chapter, I will be focus on those mechanisms rather than on the details of various air quality and noise restriction standards in effect in different jurisdictions – even though I will provide some examples.

A rather important difference between air and noise pollution is in the extent of their effects. Air pollution has both local and global effects: while aviation clearly affects air quality near airports, pollution generated by aviation activity also contributes to man-made climate change. As such, tackling air pollution generated by aviation requires a concerted global effort – something that is unfortunately largely missing, as I will discuss later. Effects of noise pollution, however, are largely localized on a relatively small number of households. For example, for the last 15 years I have been living within ten miles of airports handling millions of passengers annually (Orange County airport in California, Newcastle International in England, and now Singapore Changi), yet my exposure to aircraft noise pollution has been minimal, as I have lived away from flightpaths. Aircraft noise does however become a controversial issue (and often an important obstacle) in major airport expansion projects.