The European Union's planned carbon emission scheme is expected to cost Chinese airlines 800 million yuan ($126 million) in 2012, the head of the China Air Transport Association said.

Chinese airlines are expected to spend an estimated 17.6 billion yuan (US$2.77 billion) on the scheme by 2020, Wei Zhenzhong said.

Starting in January, airlines flying to or from Europe will have to buy permits from the EU's emissions trading scheme for carbon emissions produced during the flight, the EU announced in March.

U.S. airlines challenged the EU plan in the European Court of Justice in July for breaching international law. Russia also railed against the EU scheme and issued a joint statement with China in September, saying the move infringes upon other countries' sovereignty and burdens global air carriers.

But the European Court of Justice ruled in October that the EU's carbon tax plan is legal.

China's business press carried the story above on Monday.