Investment in scaling up global production of renewable fuels in the pursuit of the aviation industry’s Net Zero emissions target was at the forefront of discussions at this year’s Aviation Carbon conference in London. With Europe introducing from January sustainable aviation fuel (SAF) blending mandates, as well as monitoring requirements on aircraft non-CO2 impacts, industry concerns were raised over the complexity and cost of new regulations facing airlines. IATA’s SVP Sustainability and Chief Economist, Marie Owens Thomsen, criticised fossil fuel subsidies and the lack of investment by oil majors in the energy transition. Outcomes from the recent COP29, which have positive implications for ICAO’s CORSIA carbon scheme, and raising finance for SAF development, were central to a speech by the UN agency’s Secretary General, Juan Carlos Salazar.

As noted by Abdul Wahab Teffaha, Secretary General of the Arab Air Carriers Association during Aviation Carbon’s opening panel, one of the bugbears of airline associations is the prospect of a proliferation of regional mandates and schemes on the use of SAF by airlines. For example, he pointed to the EU’s and the UK’s SAF blending mandates that come into force from January 2025. The resulting “patchwork” would lead to an increase in costs and complexity for airlines, argued Teffaha.

Speaking to GreenAir after his speech, Salazar said that ICAO respects the sovereignty of any region if they chose to create their own schemes and regulations but stressed that the clear mandate given to ICAO was to address aviation’s carbon emissions at a global level and this resulted in CORSIA. “It is the only way for the international community to address CO2 emissions,” he noted.

For Salazar, the work being done by ICAO on aviation emissions is “a very solid basis to achieve our goal of net zero emissions by 2050…it is the way forward,” he said. “ICAO is steadily implementing CORSIA, and we are now moving from the voluntary to the mandatory phase. We are confident that the international community will continue its steady work on CORSIA and emission reduction policies as we create a very solid framework for the further advancement of the LTAG.”

As Salazar reminded delegates: “The landmark adoption of a long-term global aspirational goal (LTAG) of net-zero carbon emissions by 2050 during the 41st Session of the ICAO Assembly in 2022 settled an ambitious target for our industry. This goal recognises the urgent need to address climate change while acknowledging the vital role of aviation in global development.”

In addition, he added: “The success of the Third ICAO Conference on Aviation and Alternative Fuels held last year in Dubai, the CAAF/3, with its adoption of a Global Framework for SAF, Lower Carbon Aviation Fuels (LCAF),and Cleaner Energies, marked another significant step forward, setting out four key building blocks: Policy and planning; Regulatory framework; Implementation support; and Financing.

“The global target to achieve a 5% CO2 emissions reduction by 2030 through the use of SAF, LCAF and cleaner energies is also an ambitious, but achievable target with concerted effort. And the recently approved roadmap by the ICAO Council will guide our implementation activities, starting with the allocation of financial and human resources,” noted Salazar.

Obtaining the huge sums needed to develop a SAF industry was a constant theme during Aviation Carbon. According to Salazar: “Financing will be paramount for achieving our collective goals for a net zero future, this was the central focus of the discussions at COP29 last week.” This year’s UN climate change conference, COP29, took place the week prior to Aviation Carbon in Baku, Azerbaijan.

“The clean energy transition will require substantial financing. I am pleased to share that the ICAO Finvest Hub is well under development and our ambition is that it will be a crucial platform to facilitate investment partnerships, particularly for countries and regions that do not yet have SAF production capabilities,” explained Salazar.

“Our steady progress with the Finvest Hub is evidenced by our recent agreement with the International Renewable Energy Agency (IRENA). This co-operation, signed at the G20 Energy Ministerial meetings in Brazil last month, will significantly boost financing opportunities for sustainable aviation fuels and other cleaner aviation energy projects.

“The ICAO Finvest Hub will connect aviation decarbonisation projects with potential public and private investors, and beyond this matchmaking function, its value will lie in the collaboration between ICAO and financial institutions to fund projects,” said Salazar.

“The Finvest Hub is also an integral part of ICAO’s capacity-building and implementation support activities. More than 200 States and organisations are now part of ICAO’s Assistance, Capacity Building, and Training programme for SAF, known as ACT-SAF. This initiative provides crucial support for SAF development and deployment, offering training, feasibility studies, business implementation reports, support for SAF certification and policy development, and implementation of specific SAF projects for States,” Salazar told delegates.

“As we speak, more than 20 SAF feasibility studies and business implementation reports are under development. ICAO has a pivotal role in providing a harmonised, independent and robust regulatory framework for the environmental certification of cleaner aviation energies.

“I am pleased to inform you that currently 48 feedstocks are recognised under CORSIA. As States prepare their national policies for the aviation clean energy transition, adhering to this framework will ensure a level playing field for considering the environmental benefits of such fuels.

“Additionally, CORSIA continues as a crucial element in our basket of measures to reduce aviation’s carbon footprint.,” said Salazar. “Since 2019, all 193 ICAO member states are implementing the scheme’s monitoring, reporting and verification system. In addition, I’m delighted to acknowledge that 129 member states have confirmed their voluntary participation in the scheme subject to offsetting requirements in 2025, and we want more states to participate in future years.

“At its last session, the ICAO Council approved four additional programmes as eligible for CORSIA, ensuring that sufficient emissions units could be available for use in the scheme’s first phase,” said Salazar. The buying and selling of eligible emissions units through the carbon market is a crucial part of the functioning of CORSIA, but their availability has been limited up until now.

On this topic Salazar added: “The recent adoption of Article 6 of the Paris agreement at COP29 provides additional clarity in the way CORSIA eligible units can be authorised and cancelled, ensuring no double counting and stability for the voluntary carbon markets.”

Little control over fuel costs

IATA’s Marie Owens Thomsen, offering the airline perspective at Aviation Carbon, mused that as “complete price-takers” to the fuel suppliers, airlines have little control over what represents some 30% of their total costs. “The fantasy I harbour is that airlines can progressively take control over our own destiny and in-source more of their fuel supply,” she said. Her point was partly intellectual, but investing in jet fuel production is something various carriers are believed to be interested in.

She also noted that because aviation only takes 8% of global refined fossil fuel capacity, “the oil companies don’t need us for their profit optimisation.”

The health of the global economy, despite geo-political turmoil in the Middle East and war in Ukraine, is “strikingly stable”. With growth of 3.2% over the past two years and similar forecast into 2025 the economic backdrop is “super healthy”. This economic growth has seen oil prices dropping. “Anything under $80 a barrel is supportive of the global economy,” she noted.

However, Owens Thomsen questioned if today’s relatively low oil prices disincentivise investment in the move to renewable energy. They discourage the oil majors, she said, which have seen their stock prices rise on the back of lower oil prices, from investing in the energy transition. At the same time, lower oil prices have seen the stock prices of renewable energy industries “tank”.

“COP29 showed that the energy transition is a global problem. People need to understand that aviation is not a beast to be singled out,” she stated. “The real task is to switch from fossil fuels to renewable energies and we need to make money flow to the renewable energy industry. Imagine a world with ample energy supply that is cheap and renewable.”

One of the frequent questions at the two-day conference was whether the fossil fuel industry is investing enough in the energy transition. The answer was often it is not, mainly because it is not in its interests today to do so.

Owens Thomsen pointed to one of the impediments she believes is holding things back: the multi-billion-dollar subsidies given to the fossil fuel industry. “One of the discussions I struggle most to have is a conversation on fossil fuel subsidies,” she said.

This year’s Aviation Carbon 2024, co-organised by GreenAir, attracted a record 450 delegates from around 70 countries.

Photo (Shai Dolev): ICAO Secretary General Juan Carlos Salazar delivers the closing speech at Aviation Carbon 2024

Mark Pilling

Contributing Editor

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Countries meeting in Dubai for the third Conference on Aviation and Alternative Fuels (CAAF/3) have agreed a global framework to support the clean energy transition of the aviation sector that will be required to achieve its current objective of net zero carbon emissions by 2050. In the new ICAO Global Framework for Sustainable Aviation Fuels (SAF), Lower Carbon Aviation Fuels (LCAF) and other Aviation Cleaner Energies, such as hydrogen and electricity, Member States have agreed a ‘Vision’ to achieve an aspirational global interim goal of a 5% reduction in the carbon intensity of aviation fuel by 2030. The collective goal recognises that some States will be able to move quickly whereas others will take longer and require capacity-building assistance, finance and time to develop the necessary infrastructure. The agreement has been welcomed by industry, which expects the move to lead to supportive government policies and send a strong signal to investors and the traditional energy sector.

Key elements of the Framework agreement reached at CAAF/3 include a collective Vision for the clean energy transition, harmonised regulatory foundations, supporting implementation initiatives and improved access to financing so that, in ICAO parlance, “No country is left behind”.

Commenting on the outcome, ICAO Council President Salvatore Sciacchitano said: “The role of the Framework is to facilitate the scale-up of the development and deployment of SAF, LCAF and other aviation cleaner energies on a global basis, and mainly by providing greater clarity, consistency and predictability to all stakeholders, including those beyond the aviation sector.

“Investors, governments and others all need greater certainty regarding the policies, regulations, implementation support and investments required so that all countries will have an equal opportunity to contribute to, and benefit from, the expansion in the production and use of these fuels and the expected emissions reductions they will lead to.”

Haldane Dodd, Executive Director of the cross-industry Air Transport Action Group said it was another milestone event for the sector, following the adoption at last year’s ICAO Assembly of the Long Term Aspirational Goal of net zero carbon emissions by 2050. He said the agreement would “add another layer of certainty” in the shift towards the replacement of fossil fuels by SAF and unlock the significant capital investment needed, which ICAO estimates at $3.2 trillion.

“Aviation has provided a near-term objective and the global framework,” said Dodd. “Now it is up to the finance community and energy sector to support the necessary infrastructure and start delivering SAF in ever increasing quantities.”

IATA Director General Willie Walsh said the setting of a goal with a shorter 2030 time horizon was ambitious. “To that end, the CAAF/3 agreement signals to the world in no uncertain terms the need for policies that enable real progress. There is no time to lose. IATA now expects governments to urgently put the strongest possible policies in place to unlock the full potential of a global SAF market with an exponential increase in production.”

IATA pointed out that all SAF produced in 2022 had been bought by airlines at an additional cost of $500 million because of the price premium over conventional jet fuel, and yet the availability of SAF was expected to be limited to 0.2% of jet fuel consumption in 2023. Airline forward purchase agreements for SAF are worth around $45 billion in total, well in excess of SAF availability, it said.

“Airlines are ready with open arms to catch the resulting SAF production,” said Marie Owens Thomsen, SVP Sustainability and Chief Economist. “While airlines are at the sharp end of decarbonisation, they cannot bear the burden alone. CAAF/3 has again made it clear that aviation’s decarbonisation will require the wholehearted and united efforts of the entire value chain as we all focus on net zero by 2050. To be perfectly clear, where government money leads, private money will follow. It is absolutely essential that governments play their part, and we will certainly play ours.”

The adopted Global Framework is built across four interconnected building blocks: policy and planning, regulatory frameworks, implementation support and financing. The ‘Vision’ of a collective 5% emissions reduction goal in international aviation (an earlier draft had the goal ranging from 5 to 8 per cent) is to be continually monitored and periodically reviewed through an annual ICAO stocktake and the convening of a CAAF/4 that should take place no later than 2028. ICAO, with the contribution of its technical body CAEP, is required to identify and develop methodologies for monitoring progress.

To ensure environmental integrity, the CORSIA sustainability criteria, sustainability certification and the methodology for the assessment of lifecycle emissions used for CORSIA eligible fuels should be used as the accepted basis for the eligibility of sustainable fuels used in international aviation. With CAEP, the framework requires ICAO to undertake a study of fuel accounting systems for international aviation currently used in the open market, which is to include preliminary exploration of the book-and-claim concept.

The framework requires ICAO to urgently put in place the necessary structure and capability of the proposed ICAO Finvest Hub, through which a platform will be developed to connect aviation decarbonisation projects with potential public and private investors, and collaborate with financial institutions, such as development banks, to create pathways for the funding of projects.

A statement by the UK government, which had convened on the first day of CAAF/3 a meeting of the 62-country International Aviation Climate Ambition Coalition, an initiative it set up at COP26 in 2021, said the compromise agreement would enable countries across the world to develop their own SAF industries, “turning cleaner flying into a reality worldwide”.

Added Aviation Minister Anthony Browne: “While the UK sought to secure greater ambition, this is a significant moment in our path to sustainable flying. The UK remains steadfast in its commitment to decarbonise international aviation. This deal shows that when the world comes together and cooperates, we can bring about real change.”

Photo: ICAO

Christopher Surgenor

Editor

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In what ICAO Council President Salvatore Sciacchitano described as the UN civil aviation agency’s most important event of the year, countries are convening this week in Dubai to agree a global framework on a cleaner energy future for aviation. The purpose of the Conference on Aviation Alternative Fuels (CAAF/3) is to steer policy direction and financing to aid the rapid shift towards new forms of sustainable energy, in particular sustainable aviation fuels, to meet ICAO’s Long Term Aspirational Goal (LTAG) of net zero carbon emissions from international aviation by 2050. Sciacchitano said it would be a massive task that required immediate collective action. SAF production remains largely confined to Europe and the USA but the collective global target will require huge support and investment for energy transition in the developing world. The week-long meeting has been marked with an Emirates A380 demonstration flight with one engine powered by 100% SAF.

“We must urgently scale up the development and deployment of sustainable, lower carbon and other clean energy aviation fuels in order to meet the sustainability expectations of both the world and the stakeholders,” said Sciacchitano in his opening address at CAAF/3. “We have a massive task ahead of us this week as we deliberate on the ICAO Global Framework for aviation’s cleaner energy transition, a key step for the sustainable development of air transport. ICAO’s main priority is the implementation and achievement of LTAG. To do this, we need to take collective action now and CAAF/3 can be instrumental in laying the building blocks in terms of policy and planning, regulatory framework adjustments, implementation support and financing.

“This is also an opportunity for States to demonstrate strong leadership in addressing international aviation emissions just before the UN’s COP28 climate change conference also taking place here in the UAE. A successful, robust and ambitious global framework can only serve to shine a bright spotlight on the shared efforts and commitment to decarbonising our sector. We have a great opportunity to show and communicate to the world that aviation is seriously and strongly committed to decarbonise by 2050.”

In a video address, UN Secretary-General Antonio Guterres said aviation was one of the most challenging sectors to decarbonise, “but with innovation and investment, it can be done.”

He added: “A net-zero aviation sector means cleaner energy sources on a global scale. It means economic policies and regulations that can support a just and equitable transition while attracting investors, and it means measures such as carbon pricing, low-carbon fuel standards and subsidies for sustainable aviation fuels. The global framework emerging from this conference is a critical step towards a clean and prosperous future for this vital sector. By moving at jet speed you can speed up the clean energy revolution our world needs.

“With the upcoming COP28, now is the time to turn ambition into concrete action to find ways to deliver on your net zero target and shape a better, cleaner future for all.”

CAAF meetings take place only on a six-year basis, the first held in Brazil in 2009, and CAAF/3 is the culmination of a series of stocktaking and pre-CAAF/3 conferences and consultations to prepare the ground for a ‘2050 ICAO Vision’ for SAF, lower carbon aviation fuels (LCAF) and other aviation cleaner energy sources in order to define a global framework in line with ICAO’s ‘No Country Left Behind’ initiative that takes into account national circumstances and capabilities. SAF, LCAF and other aviation cleaner energies are expected to make the largest contribution towards achieving the LTAG.

The 2050 Vision acknowledges that no single fuel source will be produced at a level necessary to achieve the LTAG and so the framework needs to be flexible and not exclude any particular fuel source, pathway, feedstock or technology that meets the CORSIA eligible fuels criteria, says ICAO.

Since earlier this year, a Small Group for Preparations for CAAF/3, under the Climate and Environment Committee (CEC) of ICAO’s governing Council, has been considering possible CAAF/3 outcomes, including a draft global framework. The framework is built across four interconnected building blocks that need to advance and work together: policy and planning; regulatory frameworks; implementation support; and financing.

Although there has been general convergence on the Vision, some differences remain around aviation cleaner energies and financing, which will be discussed during the conference.

A number of States want to see CAAF/3 emerge with a quantified goal in order to send a political signal of support for sustainable fuels that could unlock private sector investment around the world.

“The reason why investors need this outcome is that it is crucial to assuring the durability of their investments,” US government representative Annie Petsonk said during an opening panel session. “If they are going to make the major investments that allow SAF to be produced in refineries and to develop the required feedstocks and supply chains, they want to see governments are serious about this transition. Through informal consultations I have had already, I am very hopeful that I will be able to communicate a positive outcome to them.”

The US is also supporting the creation of the ICAO Finvest Hub, which aims to act as a facilitating platform to connect projects contributing to the decarbonisation of international aviation, including feedstock and SAF production, with potential public and private investors. A priority of the initiative would be to support developing countries and those with special needs in financing aviation decarbonisation projects. It would also offer technical assistance, capacity building and guidance on the development of legal and policy frameworks.

Industry is also represented at CAAF/3 and has a similar wish list. “There are two key outcomes we would like to see from the conference: a goal for SAF deployment that can provide investment certainty to the finance markets and influence policy actions around the world, and a supportive global framework that will ensure countries everywhere can take advantage of the opportunities to build new energy industries and secure jobs in supplying SAF,” said Haldane Dodd, Executive Director of the cross-industry Air Transport Action Group (ATAG).

ATAG says the transition to SAF is already underway, with policy measures being implemented or discussed in around 40 countries, with $45 billion in forward SAF purchase agreements in place with airlines, operators and corporate partners. Ten facilities are currently producing SAF, it says, but by 2029 over 150 projects in 35 countries are being explored that could be used for SAF production.

“The SAF scale-up has begun,” said Dodd. “Over 10 times more SAF was delivered to airlines in 2022 than in 2019. That pace of development will continue but needs to accelerate significantly to keep in line with the industry’s path to net zero.

“Three things are needed to make the aviation energy transition happen: government policy to support supply and create certainty for demand; financing of the potentially $1.5 trillion in infrastructure capital needed to supply SAF at the scale required; and a serious effort by the traditional energy sector to shift their products from fossil to sustainable fuels. We believe the CAAF/3 meeting can set the scene for these developments and help catalyse the transition in aviation. These are tough decisions and complex challenges, but necessary ones to progress as climate change makes its impacts felt.

“A global framework from CAAF/3 will help capacity building and access to finance so that countries everywhere can build SAF industries of their own. Enormous value can be created in diversifying and democratising energy supply if governments grasp the opportunities ahead of them.”

Added Laurent Donceel, Deputy Managing Director of Airlines for Europe (A4E): “The future of aviation depends on sustainable aviation fuels and it is critical the CAAF/3 meeting produces a global agreement for a net-zero aviation with realistic targets to promote the use of SAF. Global investments in SAF and boosting the energy transition in aviation will create a bounty of jobs and growth around the world.

“Europe and the USA are accelerating down the runway towards a more sustainable future so it’s critically important that the rest of the world keeps up and delivers a truly net zero aviation industry. CAAF/3 is an ideal opportunity to set this in stone.”

Environmental NGOs belonging to the International Coalition on Sustainable Aviation have called on the meeting “to adopt a global aspirational quantified objective for 2050 and an aspirational trajectory that are consistent with the Paris Agreement temperature goals, and that prioritise the environmental and social integrity of alternative fuels.”

Setting the goal, they say, requires adopting, primarily, a metric that focuses on the carbon intensity of alternative fuels on a lifecycle basis, consistent with CORSIA eligible fuels methodology.

“A successful outcome requires focusing on defining an ambitious vision that prioritises the environmental and social integrity of alternative fuels and therefore avoids trading an environmental threat for another,” said a statement presented at CAAF/3. “The focus should always be on quality rather than quantity.”

In addition to a robust sustainability standard, said the NGOs, CAAF/3 should emphasise transparency to ensure alternative fuels are accurately reported and accounted for, with the avoidance of double counting critical for integrity.

The statement notes that whereas the CAAF/2 vision focused solely on sustainable aviation fuels, the scope for CAAF/3 has been expanded to cover not only other cleaner energy sources such as cryogenic hydrogen and electricity, but also lower carbon aviation fuels (LCAF) of fossil origin.

“ICSA believes that while LCAF may have potentially lower carbon emissions on a lifecycle basis, all fuels of fossil origin must, by definition, be regarded as unsustainable. The CAAF/3 Vision should avoid the use of encompassing terms such as ‘sustainable fuels’ and instead use suitable terms such as ‘alternative fuels’.

To coincide with CAAF/3, Emirates this week has become the first airline to operate an A380 demonstration flight using 100% SAF. In a collaboration with Airbus, Engine Alliance, Pratt & Whitney, ENOC, Neste and Virent, the Emirates aircraft took off from Dubai International Airport with one of its four engines powered on 100% SAF. The flight carried four tonnes of SAF, comprised of HEFA-SPK provided by Neste and HDO-SAK (hydro deoxygenated synthetic aromatic kerosene) from Virent. ENOC helped to secure the neat SAF comprised of HEFA-SPK and blended it with SAK at its facility in the airport.

The 100% SAF was used in one Engine Alliance GP7200 engine, while conventional jet fuel was used in the other three engines. The PW980 auxiliary power unit from Pratt & Whitney Canada also ran on 100% SAF. The flight on November 22 was preceded by robust engine testing, with the objective of validating the engine’s capability to run on the specially blended 100% drop-in SAF without affecting its performance or requiring modifications. Ground engine testing took place at the Emirates Engineering Centre in Dubai.

Earlier this year, Emirates completed the first 100% SAF-powered demonstration flight in the region on a GE90-powered Boeing 777-300ER. Shell has supplied Emirates with 315,000 gallons of blended SAF for use at Dubai and the airline currently uplifts SAF in Norway and France. Emirates recently expanded its partnership with Neste for the supply of over 3 million gallons of blended SAF in 2024 and 2025 for flights departing from Amsterdam Schiphol and Singapore Changi airports.

“The growing global demand for lower-emission jet fuel alternatives is there, and the work of producers and suppliers to commercialise SAF and make it available will be critical in the coming years to help Emirates and the wider industry advance our path to lower carbon emissions,” commented Adel Al Redha, COO, Emirates Airline.

Videos of the CAAF/3 proceedings are available on ICAO TV

Top photo: ICAO Council President Salvatore Sciacchitano addresses CAAF/3

Emirates A380 100% SAF demonstration flight:

Christopher Surgenor

Editor

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Following a decade of negotiations, ICAO’s member states have adopted at the conclusion of their 41st Assembly a collective long-term aspirational goal (LTAG) of reaching net zero carbon emissions for international aviation by 2050 that aligns ICAO with a similar commitment agreed by the industry last year and in line with the objectives of the Paris climate agreement. While setting a common global policy framework at a UN level, the goal does not assign binding targets to states or carriers and it will be up to countries to establish their own policies and measures to cut aviation emissions. While hailing the significance of the agreement, IATA Director General Willie Walsh said there was “not a minute to lose” and called on governments to work with the industry to decarbonise the sector, particularly on the deployment of sustainable aviation fuels that could mitigate up to 65% of the emissions needed for reaching net zero by 2050. The Assembly also agreed on a new lower CORSIA baseline from 2024 onwards, defined as 85% of CO2 emissions in 2019, a move previously resisted by the industry on cost grounds as it recovers from the impact of Covid.

“Countries have achieved some tremendous and very important diplomatic progress at this event and on topics of crucial importance to the future sustainability of our planet and the air transport system which serves and connects its populations,” said ICAO Secretary General Juan Carlos Salazar.

Congratulating ICAO states on the decision to back the industry goal, Haldane Dodd of the Air Transport Action Group said it was a milestone for the aviation sector. “The spirit of global cooperation has been on show at ICAO over the past year with governments making the most of the benefits of multilateralism,” he said. “But setting a goal is one thing, Making it a reality is where the hard work really begins and we need to continue – and accelerate – the efficiency improvements and energy transition that is already underway across the industry.”

Added IATA’s Walsh: “Now that governments and industry are both focused on net zero by 2050, we expect much stronger policy initiatives in key areas of decarbonisation, such as incentivising the production capacity of sustainable aviation fuels. And the global determination to decarbonise aviation that underpins this agreement must follow the delegates home and lead to practical policy actions enabling all states to support the industry in the rapid progress that it is determined to make.”

Efforts by states should now be focused on ways to incentivise an increase in SAF production capacity and thereby reduce its cost, he said. “The tremendous progress made in many economies on the transition of electricity production to green sources, such as solar power and wind, is a shining example of what can be achieved with the right government policies, particularly production incentives.

“The costs of decarbonising aviation are in the trillions of dollars and the timeline to transition a global industry is long. With the right government policies, SAF could reach a tipping point in 2030 that will lead us to our net zero goal.”

Walsh now wants the “aspirational” characterisation of LTAG “to be transformed into a firm goal with a clear plan of action” by the time of the next Assembly in 2025. “That means governments must work with industry to implement an effective global policy framework capable of attracting the financial resources needed to put aviation on an unstoppable track to achieve net zero by 2050. Governments must not lose the momentum that has driven the outcomes of this assembly.”

Dodd said many states will need help implementing a net zero pathway in their own country and financing the transition will be a priority. “Net zero aviation is a serious challenge but it is fully achievable if we work together across industry, government, the energy sector and finance communities,” he said.

Emerging economies with a fast-growing air transport sector, notably India and China, have argued their carriers would require until 2060 and 2070 respectively to achieve net zero emissions, implying the need for richer countries to reduce emissions even faster, said the International Council on Clean Transportation. “To build room for poorer countries to grow, richer countries will need to peak emissions even faster,” commented its Aviation Director, Dan Rutherford. “So the world will be looking for quick action from wealthier governments like the EU, US, Singapore and the United Arab Emirates. To get to net zero in 2050, we’ll need to peak emissions as soon as 2025.”

Dodd said the resolution is shaped to allow for different speeds of decarbonisation by countries around the world to ensure each government can respond to its own national circumstances but within a common global action framework. “Everyone is flying in the same direction towards net zero aviation by the middle of this century,” he added.

After the first periodic review of CORSIA, ICAO’s carbon offsetting scheme for international aviation, states agreed on another change to the all-important baseline, above which airlines are required to purchase and surrender units to offset the growth in emissions. Under the original design of the scheme adopted in 2016, the baseline was set at an average of 2019-2020 CO2 emissions from international aviation. When the Covid pandemic struck and brought air traffic to an almost complete halt, so skewing emissions in 2020, the industry successfully lobbied ICAO to change the baseline to the 2019 pre-Covid level for the pilot phase (2021-2023). Environmental groups, a number of whom believe CORSIA already to be an unambitious scheme, wanted a return to the original baseline whereas IATA advocated maintaining the 2019 baseline, on the grounds of increased costs to airlines.

Prior to the Assembly and after negotiations between states and an evaluation by ICAO’s CAEP technical committee, four options on the baseline were put to the ICAO Council, with a compromise option agreed of 85% of 2019 emissions baseline. During the Assembly, IATA changed its position to support the compromise, which was subsequently adopted by states, with the new baseline to take effect from 2024. Also agreed were revised percentages for the sectoral and individual growth factors to be used for the calculation of offsetting requirements from 2030 onwards.

Walsh commented the agreement would strengthen CORSIA but place a significantly greater cost burden on airlines. “So it is more critical than ever that governments do not chip away at the cement which bonds CORSIA as the only economic measure to manage the carbon footprint of international aviation,” he said. “States must now honour, support and defend CORSIA against any proliferation of economic measures. These will only undermine CORSIA and the collective effort to decarbonise aviation.”

The compromise did not please European clean mobility group Transport & Environment, which estimates the 85% baseline would mean just 22% of total international aviation emissions would be covered by the scheme and therefore offset in 2030. It said the low cost of offsets provided no incentive for the decarbonisation of the industry or the uptake of green fuels. T&E calculates €1.70 would need to be added to the price of a ticket to offset emissions on a flight from Europe to the US under the new baseline, compared with €2.40 for the average 2019/2020 baseline.

T&E is campaigning for all EU departing flights to be covered by the EU ETS as well as CORSIA. “This is not the aviation’s Paris Agreement moment. Let’s not pretend that a non-binding goal will get aviation to zero,” said Jo Dardenne, T&E’s Aviation Director. “If countries and industry are serious about this aspirational goal, they should stop bullying the EU out of its plans to finally price emissions from departing flights. The EU should not wait for many empty promises to move ahead with its SAF mandates and pricing of departing flights.”

Although criticising CORSIA’s lack of ambition, the Environmental Defense Fund (EDF) said the scheme was crucial for delivering monitoring, reporting and verification of international aviation emissions at the global scale and for hosting ICAO’s SAF framework.

“While ICAO missed a great opportunity to deliver greater CORSIA ambition, the 85% deal averted backsliding, an outcome that would have slashed CORSIA obligations for years,” said Pedro Piris-Cabezas, Director, Sustainable International Transport & Lead Senior Economist at EDF. “In parallel, the changes to the methodology to allocate obligations among air carriers paves the way for broader participation in CORSIA by addressing market distortions and equity issues. There’s much room for improvement and greater ambition for CORSIA, but this is a solid outcome that still gives us room to take a step forward.”

Representatives from the broader air transport industry welcomed the Assembly outcome. “This is a watershed moment in the effort to decarbonise the aviation sector with both governments and industry now heading in the same direction,” commented Luis Felipe de Oliveira, Director General of Airports Council International. “On a global scale, airports and ACI remain fully committed to reach this net zero goal and we look forward to working together as one aviation ecosystem – so air transport can sustainably deliver socio-economic benefits to people and communities for generations to come.”

Civil Air Navigation Services Organisation Director General Simon Hocquard said: “Reducing the environmental impact of aviation is one of the most pressing issues facing our industry. So we are delighted that governments have backed aviation’s aim to fly net zero.”

The Director General of the International Business Aviation Council, Kurt Edwards, added: “We commend ICAO for embracing net-zero carbon emissions by 2050, aligned with the business aviation industry’s long-term commitment. It signals to the world that governments, joining industry, must redouble climate-action efforts to achieve the goal, including implementing policies to encourage greater availability of and access to sustainable aviation fuels for all operators around the world.”

Chair of the International Coordinating Council of Aerospace Industries Associations, Jan Pie, said: “States’ agreement on an ambitious climate target aligns with the industry goal and is a strong signal of leadership in the fight against climate change by the civil aviation sector. As we go forward with new technologies and work to assure 100% compatibility of engines and aeroplanes with sustainable fuels, we look forward to working with ICAO to help put those targets into action.”

Five leading European aviation associations, which came together to publish the Destination 2050 net zero roadmap in early 2021, said the ICAO agreement would play a key role in providing consistency among policies, create a level playing field and set the ground for the necessary regulatory certainty for investment and finance to secure a sustainable future for the global air transport sector.

One of the first governments to react to the net zero agreement was the UK, which launched the International Aviation Climate Ambition, now comprising 59 countries, at the UN COP26 in Glasgow last year. The government said the initiative “played a critical role” in securing the Assembly agreement, which was in line with the UK’s own Jet Zero commitment.

“Climate change is a global challenge which will only be tackled by nations across the world working together towards clear, shared goals,” said UK Transport Secretary Anne-Marie Trevelyan, describing the collective net zero goal as an historic milestone. “It represents years of tireless work by the UK and its partners to lead the world towards a clean future for all.”

There was near unanimous support by the 184 states attending the Assembly for the LTAG and CORSIA draft resolutions presented for adoption, with objections (‘reservations’) only from China and the Russian Federation.

During the Assembly, for the first time since joining ICAO, Russia failed to win enough votes in the ballot to be re-elected for the new three-year term of the 36-member ICAO Council.

(L-R) Jane Hupe, Deputy Director, Environment, Air Transport Bureau, ICAO; Juan Carlos Salazar, ICAO Secretary General; Poppy Khoza, Director General of Civil Aviation of South Africa and the first ever female President of the ICAO Assembly; Salvatore Sciacchitano, President of ICAO Council; Mohamed Khalifa Rahma, Director, Air Transport Bureau, ICAO

A recent hybrid meeting of high-level representatives at ICAO has led to cautious optimism that the UN agency’s member states could reach a collective agreement at their forthcoming Assembly on a long-term aspirational goal (LTAG) of net zero carbon emissions from international aviation by 2050. In a concluding summary of the meeting (HLM-LTAG) held in Montreal, ICAO and its member states were encouraged to “strive to achieve” the goal in support of the Paris Agreement’s temperature aims, recognising that it should allow for the differing capabilities and circumstances of countries. The meeting’s outcomes will now be considered by ICAO’s governing Council before a resolution can be put forward at the 41st Assembly starting late September. The aviation industry has already adopted a net zero 2050 target and the sector’s Air Transport Action Group described the meeting as a significant step forward. A senior US official close to the negotiations said it was a positive development in the lead up to the Assembly. However, some important countries remain opposed to the goal with China saying at the end of the meeting it was “completely dissatisfied” with the outcome.

ICAO has been studying the “feasibility” of a LTAG since requested to do so by member states in 2010, which resulted in a major report by the Council’s environmental technical committee (CAEP) published in March, following two years of work by 280 experts that covered long-term trends, the emissions reduction potential of new technologies and fuels, as well as the cost implications (see article). Outside its remit were recommendations of what the goal should be or how residual emissions – those emissions not reduced by in-sector means – should be accounted for in order to reach net zero.

The HLM-LTAG, with representatives attending in-person or virtually from 104 member states and 15 international organisations, considered inputs from states and international organisations covering the different scenarios and options for in-sector CO2 reductions, based on the latest technological innovations, new types of aircraft and operations, and an increased global production capability for sustainable aviation fuels. No discussions took place on market-based measures, such as ICAO’s CORSIA out-of-sector carbon offsetting scheme, even though under the CAEP report’s most ambitious scenario, the net zero by 2050 goal cannot be achieved by in-sector emissions reductions alone.

A major challenge that has faced negotiators at ICAO over many years on climate goals is reconciling differences between developed and developing countries over the governing principles and responsibilities for dealing with emissions from international aviation. Countries like China, India and Russia have objected to ICAO’s mid-term goal of carbon neutral growth and have so far not joined CORSIA’s voluntary phases. China has always contended the UN climate principle of common but differentiated responsibilities and respective capabilities (CBDR) must take precedence over the non-discrimination and equal treatment principle set out in the Chicago Convention that underpins ICAO.

“CBDR is the cornerstone for all countries to establish wide international cooperation to address climate change,” said a working paper (WP/23) submitted by China for the HLM-LTAG. “ICAO’s efforts to conduct a feasibility analysis of any proposed LTAGs shall be aligned with the principle of CBDR.” Another paper submitted by China, together with India, Russian Federation and Saudi Arabia, said: “The developed nations must take [the] immediate lead in reducing carbon emissions and provide adequate implementation assistance to others; and recommend that ICAO as part of LTAG should make building assistance mechanisms [a] priority, and provide developing countries with adequate technical, funding and capacity-building, so as to strengthen the efforts of developing countries to address international aviation and climate change.”

While the concluding document from the HLM-LTAG specifically mentions a long-term aspirational goal of net zero carbon emissions by 2050, each state “is urged to contribute to achieving the goal in a socially, economically and environmentally sustainable manner and in accordance with national circumstances” and “contribute to the LTAG” within its own national timeframe. China has indicated a target of achieving carbon neutrality “before” 2060 and India has pledged to reach it by 2070.

Recognising that the largest potential impact on reducing aviation in-sector CO2 emissions will come from fuel-related measures, ICAO and its members states are encouraged to work with industry on new aircraft technologies and implementing enhanced air and ground operations, as well as with relevant stakeholders on research, development and deployment of sustainable aviation fuels, lower carbon aviation fuels and other cleaner energy sources for aviation. The document acknowledges substantial financial investments will be required and invites ICAO “to further consider the establishment of a climate finance initiative or funding mechanism under ICAO, while addressing the possible financial, institutional and legal challenges, and report to the 42nd Session [in 2025] of the ICAO Assembly.”

A working paper submitted by the EU and other ECAC states suggested the ICAO Voluntary Environment Fund “should be more visible” and states be encouraged to contribute to it, “whilst earmarking contributions for specific ICAO activities on LTAG”. A working paper presented by Brazil, India, Nigeria, Russian Federation and Sudan, and supported by some Latin American countries, recommended the establishment of a Multilateral Fund for Sustainable Aviation under the control of ICAO that would provide public and private stakeholders in developing countries with financing, capacity-building and technology transfer to help achieve an LTAG. An information paper from Australia, Costa Rica and the United Kingdom proposed the establishment of a Climate Finance Initiative, led by ICAO “as a trusted facilitator”, to bring states, industry, finance institutions and the investment community together to support, in particular, the most vulnerable developing states to access private sector financing.

ICAO set up a well-received programme to help developing states with their introduction of the CORSIA carbon offsetting scheme, called the Assistance, Capacity-building and Training for CORSIA (ACT-CORSIA). In June it established a similar programme for sustainable aviation fuels (ACT-SAF) and it is now recommended by the HLM to be extended to add support for the implementation of other emissions reduction measures in an ACT-LTAG programme. “Additionally, ICAO is encouraged to promote the voluntary transfer of technology, in particular for developing countries and states having particular needs, to enable them to adapt to cutting-edge technology and enhance their contribution to achieve the LTAG,” said the HLM-LTAG concluding text.

The outcome, described as a compromise by a number of states participating, was welcomed by the cross-industry Air Transport Action Group (ATAG), which has been urging ICAO states to adopt an LTAG at their 41st Assembly in line with the sector’s own established net zero by 2050 goal. It said a globally-aligned policy environment would bring stability of direction and certainty to bring about needed investments in new fuels and decarbonisation technologies.

“These negotiations are challenging as the different approaches of states are explored. But the effort to come together around a common goal of net zero has been encouraging and lays the groundwork for fruitful discussions at the Assembly,” said ATAG’s Executive Director, Haldane Dodd.

“Aviation decarbonisation is a huge challenge that needs investment and innovation from the industry, but also a coordinated approach with ICAO and its member states to set the appropriate policy frameworks required for success.”

In closing remarks to the four-day HLM-LTAG meeting, ICAO Secretary General Juan Carlos Salazar said: “Recovering from the effects of the pandemic and combatting climate change go hand-in-hand. As a global sector, aviation has a golden opportunity to show leadership as we ‘build back better’, aiming towards a sustainable decarbonised future.”

A full report of the meeting is available here. The ICAO Assembly runs from 27 September to 7 October.

Top photo: ICAO building

Bottom photo (ICAO): Closing session of HLM-LTAG

The first ever consignment of CORSIA-certified sustainable aviation fuel has been delivered to American Airlines at San Francisco International Airport. The world’s largest airline received the fuel from Neste as part of a pilot programme to certify SAF that airlines can use to meet their emissions obligations under ICAO’s carbon offsetting scheme for international aviation. The unspecified volume of SAF was delivered to American as the airline released its 2021 ESG Report, in which it reveals it used 1.4 million gallons of sustainable fuel last year, 0.05% of total fuel consumption. American has a goal of replacing 10% of jet fuel with SAF by 2030. In his introduction to the report, CEO Robert Isom said it was essential for long-term success of the airline to prepare for a carbon-constrained future by running a more fuel-efficient fleet powered by low-carbon fuel. In April, it received validation from the Science Based Targets Initiative for its interim 2035 GHG reduction target, the first airline to achieve this, reports Tony Harrington.

Under CORSIA, an airline can claim reduced GHG emissions against their offsetting obligations from the use of eligible fuels. Because CORSIA’s SAF certification process is new, American and Neste initiated a pilot project to certify a batch of the fuel to identify any challenges. In doing so, they became the first to receive CORSIA-certified SAF, which requires independent attestation by an ICAO-approved Sustainability Certification Scheme. Neste chose the International Sustainability and Carbon Certification (ISCC), a global system which verifies sustainable feedstocks.

“Sustainable fuel is widely acknowledged as a key element in achieving the aviation industry’s goals for carbon-neutral growth from 2020, and reaching net zero emissions by 2050,” said Thorsten Lange, Neste’s EVP, Renewable Aviation. “The pilot with American Airlines was a perfect opportunity for proving the feasibility of delivering CORSIA-certified SAF and gaining useful insights into setting up the process and the challenges we need to overcome to enable the implementation of CORSIA. Cooperation with American, ISCC and all others involved was absolutely critical in achieving this important milestone. We will be sharing our experiences in ICAO’s upcoming environmental report.”

American’s Head of ESG, Jill Blickstein, said: “American is proud to partner with Neste to demonstrate how SAF can meet the robust sustainability standards that ICAO has established for CORSIA. Our work together will also help to demonstrate to American’s customers that SAF can meet these high standards.”

The airline’s latest ESG Report focuses heavily on the importance of SAF as a decarbonisation tool and details the airline’s use and ongoing commitment to using the fuel, including a SAF offtake agreement late last year to source from US renewable fuels company Aemetis 16 million gallons of SAF per year, for seven years, commencing in 2024 – a total of 112 million gallons, which brings total purchase commitments to date to over 120 million gallons.

Isom says American was the only US airline to report using more than 1 million gallons of SAF in 2021.

On climate change, American said its strategy was to “anticipate, mitigate and respond to climate-related risks and to thrive in an uncertain future. The clearest near-term way for us to decarbonise is by using SAF, which is why purchasing and helping scale SAF production is the cornerstone of our climate strategy this decade. SAF will also be the key to achieving the in-sector reductions required to meet our science-based target for 2035.

“American’s science-based target is to reduce carbon intensity – which means greenhouse gas emissions per unit of passenger and cargo payload that the airline transports – by 45% by 2035, compared to a 2019 baseline. In setting this goal, we are committing to reduce the intensity associated with the entire life cycle emissions of jet fuel.

“This includes both direct emissions (Scope 1) – which are primarily from the jet fuel used in flight – and the emissions from the production of the jet fuel the airline uses (Scope 3). In April 2022, we received validation from the Science Based Targets Initiative (SBTi) that our intermediate 2035 GHG reduction target complies with the SBTi criteria. That makes us the first airline globally to achieve this milestone.”

To help manage its Scope 3 emissions, American has approached its key fuel suppliers to better understand the emissions created in production and distribution of jet fuel. “About 76% of American’s Scope 3 emissions are from jet fuel, including the fuel used by our contracted regional carriers and the upstream emissions from our fuel suppliers,” says the report. “These upstream ‘well-to-pump’ emissions – including extraction, crude transport, refining and product transport – constitute approximately 20% of petroleum jet fuel life cycle emissions. To move the needle on our Scope 3 emissions, we know we must work with our fuel suppliers to better understand the steps they are taking to reduce emissions within their operations.”

Image: American Airlines

As part of measures to revise the EU Emissions Trading System (EU ETS) to bring aviation in line with the bloc’s climate goals, the European Parliament has voted to apply the scheme to all flights departing the European Economic Area (EEA), to the anger of IATA. At present, the EU ETS covers only intra-EEA flights, as well as flights to Switzerland and the UK, but proposing to extend it to all international airlines serving the EU will raise concerns in countries outside Europe, says the airline body. The original scope of the scheme was to cover all flights arriving and departing EEA airports but after protests from third countries, particularly China and the US, the EU ETS was scaled back in 2013 under a ‘stop the clock’ mechanism to allow negotiations at ICAO on establishing an international agreement, which ultimately resulted in the CORSIA carbon offsetting scheme. The ‘stop the clock’ derogation ends in 2023 and unless extended again, the EU ETS reverts automatically to its original scope. Given Europe is pressing for a further agreement at ICAO on an international long-term emissions reduction goal, EU states will most likely oppose the Parliament’s position. Other measures agreed by MEPs include a quicker phasing out of free EU ETS allowances for airlines, the inclusion of non-CO2 emissions in the EU ETS and the creation of a SAF allowances pricing scheme.

Changes to the Aviation EU ETS is part of the EU’s ‘Fit for 55’ package that under European Climate Law plans to reduce greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels, in order to reach climate neutrality by 2050.

In a plenary vote in Strasbourg on June 8, MEPs adopted their report on changes to the EU ETS for aviation with 478 votes in favour, 130 against and 32 abstentions, although proposals for the wider EU ETS were voted against and must now be revised, which may hold up the legislative timetable. Parliament representatives will hold trilogue discussions with the Commission and Council (EU member states) to agree a common position on the legislative proposals.

The agreement by Parliament to extend the EU ETS to apply to all flights departing from an airport located in the EEA, starting 30 April in the year after entry into force of the new rules, is necessary to ensure ambitious GHG emissions reductions in the aviation sector are in line with the Paris Agreement, “and to contribute to an international level playing field while ensuring equal treatment on routes,” said MEPs on the environment committee (ENVI), which has responsibility for the file.

As part of ‘Fit for 55’, in July last year the Commission proposed a number of amendments to the EU ETS Directive in respect of aviation’s contribution to the EU emissions reduction target. It provided for continued application of the EU ETS on intra-EEA flights, while applying CORSIA to extra-EEA flights. Industry association Airlines for Europe (A4E) warns the Parliament amendment to include extra-EEA departing flights in the EU ETS will have regulatory overlaps leading to a potential double burden for carriers, who may have to pay for the same emissions twice through both the EU ETS and CORSIA, it argues. However, the Parliament proposal attempts to get round this, stating: “In order to take account of the [European] Union’s commitment to, and its simultaneous participation in, CORSIA, the financial value of expenditure on credits used for CORSIA for flights from the EEA to third countries that are implementing CORSIA should be deductible from the financial obligations under the EU ETS.”

This would still leave flights to countries that have not yet agreed to join CORSIA, which include major aviation markets such as India and China, subject to inclusion in the EU ETS. When the EU decided in 2012 to include all flights to and from the EEA in the newly-adopted Aviation EU ETS, India and China, along with Russia, the United States and others formed a ‘coalition of the unwilling’ to fight the plan. China threatened to cancel a large order for Airbus aircraft and the Obama Administration passed legislation, which still stands, that gives powers to the Secretary of Transportation to prohibit US airlines from complying with the EU ETS. Trade body the Air Transport Association of America (now renamed Airlines for America) brought a case against the EU over the issue in the European Court of Justice.

Reaction from the global airline industry to the new proposal has been swift. “A unilateral decision by the EU to expand the scope of ETS extra-territorially to non-EU destinations will threaten the prospects for major global decarbonisation efforts,” said an IATA statement, which argued it would make the adoption of a long-term goal at ICAO unlikely and could “weaken and potentially dismantle the existing CORSIA agreement which states agreed would be the single global market-based measure applied to international aviation.”

Moreover, it added, expanding the EU ETS scope “would lead to serious distortion of competition and weaken the global competitive position of EU airlines and hubs.”

IATA Director General Willie Walsh described the Parliament decision as “disturbing”, adding: “Europe has already suffered the embarrassment of a unanimous global rejection of its misguided attempt to impose ETS extra-territorially in 2012. The impact of any regional initiative by the EU will be quickly neutralised or worse if it derails decarbonisation efforts in faster growing markets outside of Europe. Now is the time for Europe to support CORSIA and the adoption of ICAO’s long-term aspirational goal (LTAG), which will propel global decarbonisation efforts further.”

Unsurprisingly, the Parliament decision was welcomed by NGOs, including Transport & Environment (T&E), whose Aviation Director, Jo Dardenne, said: “Europe’s lawmakers have sent a clear signal. The bulk of Europe’s aviation emissions will no longer be ignored, marking a major step forward in tackling heavily polluting long-haul flights. It’s now up to national governments to make this a reality.”

More surprising is that there are major airlines in Europe that support a move to include all extra-EEA flights in the EU ETS. In February, T&E and four of Europe’s largest low-cost carriers – easyJet, Ryanair, Jet 2 and Wizz Air – issued a joint statement calling on EU policymakers “to address the imbalanced contributions of European airlines in tackling climate change” and that all flights departing from European airports “should abide by the same rules, regardless of destination.”

Said Michael O’Leary, Group CEO of Europe’s biggest airline, Ryanair: “It is crucial that legislative proposals, such as the ‘Fit for 55’ package, apply equally to all flights, regardless of destination or distance. There is no justification to exempt any flights, especially the most polluting indirect ones, which require at least two flights to reach their destination, and/or connect onto long-haul flights, which account for just 6% of Europe’s air passengers but over 51% of EU air travel CO2 emissions.”

Other proposals passed in the Parliament include a derogation from the EU ETS to be provided for emissions from flights between airports located in an outermost region and airports located in another EEA region, and flights between airports located within the same outermost region.

The Commission proposes the phasing out of free EU ETS allowances for aircraft operators towards full auctioning by 2027, but MEPs voted to bring this forward to 2025. However, their report calls for 75% of auction revenues primarily go towards innovations and new technologies to green the aviation sector, including for the development of sustainable aviation fuels. EU member states have so far rejected attempts by the Parliament to ring-fence auction revenues for aviation decarbonisation measures.

A4E said it was “extremely concerned” about the early phase-out of free allowances, which it says should be better aligned with the emergence of decarbonisation solutions, such as SAF, suggesting 2030 would be a better date “to mitigate competitive distortion with non-EU carriers and avoid carbon leakage.”

The trade body said airlines spent €950 million ($1bn) on EU ETS compliance in 2019, having to buy certificates for 60% of their emissions at a price of €25 ($27) per tonnes. “Buying allowances for 100% of 2019 emissions at today’s carbon price of €80 per tonne would amount to ETS compliance costs of €5.2 billion ($5.5bn) annually,” it estimates. “ETS costs may well reach €6 billion by 2025, even as aviation emissions decline.”

The decision by Parliament to include obligations for aircraft operators on non-CO2 emissions within the scope of the EU ETS was described as “premature” by A4E. “Further scientific and legal analyses are still needed on the exact impacts of non-CO2 emissions from aviation and how best to address them,” it said.

The Parliament report calls for a monitoring, reporting and verification (MRV) scheme for non-CO2 emissions – such as NOx, soot particles, sulphur dioxide and water vapour – from aircraft operators, “with a view to expanding the scope of the EU ETS to cover non-CO2 aviation emissions, if deemed appropriate.”

One proposal welcomed by A4E is for a newly created SAF allowances pricing scheme that would aim to bridge the price gap between conventional jet fuel and SAF. Airlines would be granted CO2 allowances equivalent to the amount of CO2 saved by uplifting SAF. Use of synthetic or renewable fuels of non-biological origin (RFNBOs) would count double. A4E believes such a scheme would reduce the total cost of the ReFuelEU Aviation proposal.

“For it to be successful, the SAF allowances system should increase overall SAF uptake across Europe and incentivise airlines to go beyond blending mandates, in turn reducing more CO2 emissions from the sector,” said A4E. “It would also strengthen local SAF production across Europe and help Europe to better compete with the US tax credit scheme of $1.50 to $2 per gallon.”

After the vote in the plenary, the ENVI rapporteur handling the EU ETS aviation file, Sunčana Glavak, said: “With the report, we are aligning the aviation sector with our climate goals. But within that process, we have to offer decarbonisation solutions for the sector, which we managed to achieve in the ENVI committee with the introduction of SAF allowances. We are all aware that we have to focus on our climate goals, but we also cannot allow the industry to bear the whole burden. We must preserve our mobility and industry.”

Photo: European Parliament plenary session

Aviation industry pressure is intensifying on governments to adopt a long-term goal to help decarbonise air transport when they meet at this year’s ICAO 41st Assembly. Executives from across the industry have met to detail aviation’s climate aspirations ahead of the Assembly, to be held in September. At a Montreal meeting, the cross-industry Air Transport Action Group (ATAG) urged ICAO’s 193 member nations to agree on stable policies that enable aviation to transition to a net-zero future, reports Tony Harrington. “The decarbonisation of the global economy will require investment across countries and across decades, particularly in the transition away from fossil fuels,” said Haldane Dodd, ATAG’s Executive Director. “Stability of policy will matter for that investment environment.” The Clean Skies for Tomorrow Coalition, an initiative led by the World Economic Forum, has also called for an end to policy uncertainty on aviation decarbonisation, urging governments and industry to collaborate, particularly on expediting delivery of affordable supplies of sustainable aviation fuels.

The aviation industry is keen to reduce its emissions. But the cost of SAF is estimated to be at least three times that of conventional fossil fuels, deterring many airlines from buying the fuel, while lack of demand has left prices high and production low. As well, new propulsion technologies including hydrogen and electric power are still in development, and initially likely to be feasible only for short-range flights, limiting their potential to reduce emissions.

“In October last year, the industry – airlines, airports, manufacturers and business aviation – all committed to raise ambition on long-term climate action and pursuing net-zero carbon emissions by 2050,” said Dodd, in a statement following an ATAG-organised meeting, Aviation Net-Zero Dialogue, held in Montreal. “This was backed up by a high-level plan on how it can be achieved including advances in technology and a shift to new types of low-carbon fuel.

“We are one of the only industries in the world to have this kind of joined-up global vision but we need governments to also take part in this journey. The aviation industry is calling on governments meeting at this year’s Assembly to adopt a long-term climate goal aligned with industry’s ambitions.

“We know these ICAO negotiations are challenging. We are dealing with a global approach to a complex issue. We are trying to shift our energy supply very rapidly from something that has been built up over the last century. We are trying to do it without harming growth, ensuring we can continue to connect all parts of the world and provide jobs and be a conduit of trade. But the risks of not agreeing a goal also provide important impetus to the talks.”

ATAG said key to the discussions was balancing the need to decarbonise in a way that did not distort competition globally yet “raised climate ambition everywhere”, while taking into account the different levels of development and capacity around the world.

Speaking also at a UN meeting in Stockholm to mark 50 years since the 1972 UN Conference on the Human Environment, which established the United Nations Environment Programme and other processes including the UN Framework Convention on Climate Change, Dodd acknowledged the net zero emissions by 2050 pledge “is going to be a significant challenge, but we know that by working together we can make it happen.

“And we urge governments to grasp the opportunity of sustainable aviation fuel – on the flightpath to 2050, we have the chance to support more climate-friendly connectivity and transport, green energy industries in nearly every country on earth and up to 14 million jobs worldwide.”

Ahead of its Assembly, ICAO is inviting governments to take part in a hybrid high-level meeting on the feasibility of a long-term aspirational goal (HLM-LTAG) in Montreal on July 19-22. Representatives, said ICAO, “will discuss the CO2 emissions reduction scenarios and options for a goal, along with the means of implementation and the monitoring of progress, before concluding with recommendations.” The meeting will be preceded by an open-to-all online ICAO Stocktaking event to inform delegates and others on the latest developments on technology, operations and fuels.

Meanwhile, the Clean Skies for Tomorrow Coalition, in its newly-released 2030 ambition statement, said aviation historically accounted for around 1 billion tonnes, or 2-3% of global CO2 emissions, each year and risked rising again as airlines recovered from the pandemic and resumed operations.  

“Members of the coalition agree that achieving net zero in the sector will require reduction, as far as possible, of the emissions caused by the aviation sector through efforts including the optimisation of routes and increased energy efficiency through the use of new aircraft and improved ground operations,” said the coalition. “Any remaining emissions must be balanced by appropriate carbon removal, so as to arrive at net zero emissions in the sector.

“Hybrid-electric and hydrogen-powered aircraft could significantly help the industry reach the next efficiency horizon, but development and deployment at scale will take time and the technology will be first available for short to medium range aircraft. The deployment of sustainable aviation fuels is the most promising option to significantly reduce the industry’s carbon emissions in the near term, and for long-haul flying, even beyond 2050.

“The key issue currently preventing the production and use of SAF from taking off is the price gap between fossil-based jet fuel and SAF, which remains prohibitively large. But fuel providers are lacking a strong demand signal to increase production, and demand is low due to the high price premium. Furthermore, policy uncertainty deters investment, as does the high level of risk associated with new technologies.

“We are therefore calling on governments, international organisations and other stakeholders to work with us to achieve our vision through comprehensive policy mechanisms, targeted investments and fiscal support and regulations that afford a level playing field while incentivising transformation. Together we can take a giant leap towards the decarbonised, sustainable and affordable aviation industry needed for our global future.”

Photo: Montréal-Pierre Elliott Trudeau International Airport

Annual residual CO2 emissions from international aviation – those emissions that remain after in-sector reduction efforts – could range from 200 million tonnes (Mt) to 900 Mt by 2050, according to a major study by ICAO’s Committee on Aviation Environmental Protection (CAEP). The completed report provides the results of two years of technical work by 280 experts from around the world to explore the feasibility of a long-term global aspirational goal (LTAG) for international civil aviation CO2 emission reductions. Described as the most comprehensive and complex study of its kind, the analysis provides long-term trends and emissions reduction opportunities from operations, new aircraft technologies and future fuels and energy sources against a backdrop of traffic demand forecast scenarios and the climate science. The results show a heavy reliance on sustainable fuels for the most optimistic outcome on in-sector reductions. A decision on whether to adopt a long-term emissions reduction goal is expected to be taken at ICAO’s next triennial Assembly that starts in late September.

The report was adopted “unanimously” at the CAEP/12 meeting in February, according to CAEP Chairperson Urs Ziegler. Its main findings have been presented in an informal online briefing to State members of ICAO’s governing Council. In moves to become a more open and transparent organisation, the briefing, which included initial reactions and questions from Council members about the findings, has been made available publicly on ICAO TV.

ICAO adopted a resolution at its 37th Assembly in 2010 requesting the Council to explore the feasibility of a long-term goal for international aviation “through conducting detailed studies assessing the attainability and impacts of any goals proposed, including the impact on growth as well as costs in all countries, especially developing countries …”. In each subsequent Assembly climate resolution, the Council has been requested to continue the work on the goal’s feasibility.

Briefing Council members on the new report, Ziegler said: “I would like to underline that CAEP stands unanimously behind it and it is important CAEP noted no further work was needed in this area as it would not bring any fundamentally new insights or results that would go beyond what has already been evaluated. There are many other reports out there but none has gone as deep as our experts have done in the last two years. Everything we have proposed in this report is both feasible and attainable.”

A feature of the CAEP studies is that its forecast scenarios on air traffic and fleet evolution have been extended beyond 2050 to 2070. The results have been calibrated against the IPCC’s AR6 scientific report last year on the allowed global CO2 emissions for limiting the global mean temperature increase to 1.5°C or 2°C.

The CAEP LTAG Task Group developed a methodology involving three integrated scenarios – IS1, IS2 and IS3 – to represent a low, mid and high degree of aspiration related to readiness and attainability against a baseline (IS0). The least ambitious scenario (IS1) shows residual emissions of around 950 MtCO2 in 2050 (around 160% of 2019 CO2 emissions} from international aviation, after a total reduction of 39% in 2050 against the baseline as a result of in-sector incremental improvements in technologies (-20%) and operations (-4%), plus new fuels (-15%). The mid ‘increased/further ambition’ scenario (IS2) shows around 495 MtCO2 in residual emissions in 2050 (80% of 2019 CO2 emissions), with a 68% reduction in 2050 emissions from the baseline through technologies (-21%), operations (-6%) and fuels (-41%). The ‘aggressive/speculative’ (high) scenario (IS3) forecasts residual emissions of around 200 MtCO2 in 2050 (35% of 2019 CO2 emissions), with an 87% reduction in 2050 from the baseline through technologies (-21%), operations (-11%) and fuels (-55%).

The three scenarios therefore show the potential for CO2 reductions from in-sector emissions is substantial, although none reach zero emissions, even up to 2070, pointed out Ziegler. Even with a 100% replacement of conventional jet fuel with novel fuels, there are life-cycle emission considerations. However, drop-in advanced fuels are expected to have the largest impact in driving overall reductions by 2050. The analysis shows hydrogen is not expected to make a significant contribution to overall emissions reductions before 2050, largely because hydrogen power was considered appropriate to short-haul operations whereas the bulk of international aviation emissions (ICAO is not responsible for domestic aviation emissions) were from long-haul flights, but may increase afterwards if technically feasible and commercially viable, says the report.

The analysis shows advanced tube and wing aircraft have a clear potential to improve the fuel efficiency of the international aviation system, with an incremental contribution from aircraft with unconventional configurations. The emissions reductions from technology are expected to grow after 2050 as these aircraft penetrate the fleet.

CO2 emissions in 2050 after in-sector emissions reductions from technologies, operations and fuels were modelled against low, medium and high international aviation traffic forecasts. For IS1, CO2 emissions in 2050 are estimated to range from 730 MtCO2 to 1160 MtCO2; for IS2 the range is 420 MtCO2 to 590 MtCO2; and for IS3 the range is 150 MtCO2 to 260 MtCO2. The IS3 scenario demonstrates the critical importance of the contribution from novel fuels to decouple the growth in traffic from its CO2 emissions, says the report.

The costs of LTAG

Using a cost minus baseline approach, CAEP assessed the cumulative costs and investments associated with the integrated scenarios for the period 2020 to 2050. Costs and savings were assessed from technology, operations and fuels measures across stakeholders. Investments required from States in R&D to support aircraft technology developments could be as high as $870 billion in the IS2 and IS3 scenarios, with OEMs adding a further $350 billion. Investments from fuel suppliers were estimated to total $1.3 trillion (IS1) to $3.2 trillion (IS3) across the 30-year period. Costs and investments for ANSPs were estimated at $11-20 billion and for airports $2-6 billion across LTAG scenarios towards the implementation of operations measures. Under the IS3 scenario, a further $100-150 billion would be required towards investments in infrastructure at airports for hydrogen aircraft.

Airlines should benefit, found the analysis, from $710-740 billion in reduced operating fuel costs as a result of aircraft technology improvements, subject to a requirement for incremental fleet investments. A further $210-490 billion could be saved in reduced operating fuel costs from operational measures associated with $40-155 billion of implementation costs. Overall incremental fuel related costs (minimum selling price of novel fuels minus conventional jet fuel price) for airlines against the three integrated scenarios are estimated at $1.1 trillion (IS1), $2.7 trillion (IS2) and $4 trillion (IS3) cumulatively over the period.

CAEP acknowledges LTAG may result in some increases in operating costs being passed on to passengers. There may also be significant regional variations in the production and uptake of fuels due, for example, to regional availability of renewable energy and feedstocks, it adds.

CAEP was not tasked with consideration of the goal itself or out-of-sector emissions reductions, such as from market-based measures, but did look at the potential technical aspects of LTAG implementation, without prejudging future decisions on the goal. It suggests State Action Plans may be used for States to report progress towards a goal and if a goal was adopted, it could conduct future work, for example on possible metrics and reporting mechanisms. ICAO may need to review any goal to ensure it remains appropriate, it says, with perhaps a triennial review process similar to that for CORSIA. It also highlights a possible need for State capacity building and assistance that could include workshops, assistance on monitoring and measuring CO2 emissions and an overarching training programme like ACT-CORSIA.

Backed by other Council members during a Q&A session after the briefing, ICAO Council President Salvatore Sciacchitano congratulated CAEP on its “incredible” work and described the report as “impressive”, adding it would help to better inform the Council in its understanding. Ziegler recommended the full report, said to run to around 500 pages, be made available publicly, which Sciacchitano said would be a decision for the Council.

Some Council members said the report should be published as soon as possible and believed the findings had demonstrated the feasibility of a long-term goal. Other members expressed concerns over the potential costs of a LTAG and feared this would fall disproportionately on developing States and impact aviation growth in those countries.

Jane Hupe, ICAO’s head of environment, told the briefing that all States had approved the temperature goals of the Paris Agreement and they applied not just to individual States but also to all sectors, including aviation. “We have to comply and are required to have more ambitious goals,” she said, adding that there were already signs of a bottom-up reaction by governments and regions on policy decisions, which ICAO had to respond to at a global level. She said a LTAG would require looking again at the ambition of ICAO’s CORSIA offsetting scheme, which is designed to run until 2035 with a carbon-neutral growth goal.

A decision on LTAG will be taken at the 41st Assembly, which has now been extended to run over three weeks, rather than the normal two. It will now take place as a hybrid event between September 27 and October 14.

Before the Assembly, a special high-level meeting (HLM) of State representatives has been convened on the feasibility of a LTAG between July 20 and July 22, intended to be held in-person in Montreal and also online, subject to the Covid situation. It is expected to be immediately preceded by a two-day stocktaking event to share with delegates the latest relevant information. A Small ad-hoc Group comprising 13 Council representatives has been established that will play an important role in facilitating the drafting of a proposal for the HLM.

As a precursor to the HLM, ICAO is also holding a series of five regional virtual events for Member States starting on March 28 as part of the LTAG consultative process. Called the LTAG Global Aviation Dialogues (LTAG-GLADS), they aim to raise awareness of ICAO’s LTAG work and facilitate an exchange of views, in particular on reaching a decision on LTAG.

Update March 22: The report is now available to download at https://www.icao.int/environmental-protection/LTAG/Pages/LTAGreport.aspx

Photo: ICAO Council Chamber

Two years after it was launched as a pilot by IATA and CBL Markets, part of Xpansiv CBL Holding Group (XCHG), the Aviation Carbon Exchange (ACE) has seen its first transaction via the IATA Clearing House (ICH), which makes it easier for airlines to purchase carbon credits using IATA’s financial back-end process. The new technical integration with the ICH functionality will make the need for financial settlements through a third party unnecessary and enable transactions to be seamless, risk-free and quicker, said IATA.  As a centralised marketplace, the ACE was launched in response to a requirement by airlines to purchase eligible units in compliance with the ICAO carbon offsetting scheme CORSIA. Although the Covid-19 pandemic has largely pushed back that need by a number of years, IATA and non-IATA airlines can trade on the exchange to purchase offsets for voluntary passenger offset programmes and net zero commitments. According to IATA, several airlines have already used the exchange, with JetBlue being the first to make a trade, but Qatar Airways is the first to use the new integration with the ICH.

“Since it was launched in November 2019, the ACE has provided airlines with a secure access to real-time carbon offset data, with full price transparency. We’ve now completed the technical integration of the ICH functionality with the ACE, which is a significant milestone to make financial carbon offset transactions seamless, safe and timely for years to come,” said Michael Schneider, Assistant Director Environment Programs, in an IATA blog.

With an annual turnover of around $56 billion and over 430 participants, the IATA Clearing House provides billing and settlement services in multiple currencies for the air transport industry. Open to IATA and non-IATA airlines, airline-associated companies and travel partners, it is a “netting” solution for the clearance of passenger, cargo, UATP (corporate travel) and non-transportation billings between them.

“All of our member airlines already have access into IATA’s financial back-end process and can simply use the existing connectivity to have their trades settled,” explained Schneider. “To give you an example, let’s say airline X makes a $30 million trade for offsets. In the absence of the ACE/ICH set-up, it usually requires the involvement of numerous people to complete a trade, from procurement to treasury to finance, resulting in a lengthy process that can take weeks. By then the carbon price will no longer be guaranteed and they face issues each time they trade, because the price cannot be locked in.

“Using the ICH, on the other hand, will reduce the time to two days, offering a secure and safe mechanism to the airline. Furthermore, on the seller side the ICH guarantees payment, again with a speedy two-day process, so it’s excellent news for all participants.”

He told GreenAir that total trading volumes on the exchange in 2021 were close to 5 million tonnes of “high-quality” credits, most but not all CORSIA-eligible units. He pointed out that many forestry and REDD+ projects can be of high quality but have not yet been approved under the review process by ICAO’s Technical Advisory Body, which assesses and recommends programmes and units for eligibility under CORSIA.

“These non-CORSIA credits can be appealing to an airline in the context of its voluntary passenger offset programme where it is looking for a specific geographical region and/or the project is linked to a number of UN Sustainable Development Goals, for example gender equality and improving health and living conditions,” said Schneider. “So the ACE makes an important contribution to climate finance, providing project developers the opportunity to list their credits issued on the exchange and to reach out directly to airlines, instead of selling through intermediaries.”

He added: “Airlines’ individual offset commitments, the use of credits for passenger offset programmes and also to furnish corporate customers with credits has driven most of the demand in 2021 and we expect to see the same in the near future.”

Commenting on Qatar Airways’ trade following the ACE/ICH integration, IATA Director General Willie Walsh said: “CORSIA is a key tool for helping the industry achieve carbon-neutral growth as part of our long-term target to reach net zero carbon emissions by 2050. The Aviation Carbon Exchange enables airlines to purchase their offsetting credits with maximum transparency and minimum bureaucracy. By performing the first-ever trade on the ACE using the IATA Clearing House, Qatar Airways has demonstrated its support for the ICH as a means of pioneering efficiency in transactions that will make the purchase of quality carbon offsets easier for all airlines.”

Responded Akbar Al Baker, Qatar Airways Group Chief Executive: “Qatar is one of the States that voluntarily participates in the pilot phase of CORSIA. As a leader in aviation, Qatar Airways is driven by an ambitious environmental sustainability vision and we are determined to support Qatar in this pursuit by remaining compliant with the global scheme. We welcome the use of the Aviation Carbon Exchange as it enables airlines to invest in CORSIA eligible emission reduction units, further supporting Qatar Airways’ commitment to invest in a low-carbon future, while reducing our financial risk.”

Photo: Qatar Airways

Editor’s note: GreenAir is a co-organiser of the international Aviation Carbon conference and we are delighted to announce that Xpansiv CBL will be the lead sponsor of our 10th anniversary event, Aviation Carbon 2022, which will be held, hopefully in-person, at the London Heathrow Marriott on October 17-19. More details will be posted shortly.