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Aviation

Subsector
Not on track
Shutterstock 1509194717

About this report

In 2021 aviation accounted for over 2% of global energy-related CO2 emissions, having grown faster in recent decades than road, rail or shipping. As countries emerged from Covid-19 lockdowns, aviation emissions in 2021 reached around 720 Mt, regaining nearly one-third of the drop from 2019 levels seen in 2020. Many technical measures related to low-carbon fuels, improvements in aircraft and engines, operational optimisation and demand restraint solutions are needed to get on track with the Net Zero Emissions by 2050 Scenario – to curb growth in emissions and ultimately reduce them this decade. 

Important recent policy developments that could help towards this end include the US Sustainable Aviation Fuel Grand Challenge announced in September, which includes funding to demonstrate fuel and aircraft technologies, and the proposed ReFuelEU Aviation regulation, which is currently under development and if adopted will set blending mandates for sustainable aviation fuels.

CO2 emissions

Aviation emissions rose in 2021, rebounding to a level between their pre-pandemic peak in 2019 and the level in 2020. After increasing at an average of 2.3% per year from 1990 to 2019, the Covid-19 pandemic led direct CO2 emissions from aviation to plummet from over 1 000 Mt CO2 in 2019 to 600 Mt in 2020. Emissions in 2021 totalled around 720 Mt CO2, regaining nearly one-third of the fall seen in the previous year. They are expected to continue to grow rapidly, surpassing their 2019 level in the coming few years. 

Direct CO2 emissions from aviation in the Net Zero Scenario, 2000-2030

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Multiple additional measures will be needed to promote the technologies, operations and market conditions necessary to get emissions below 900 Mt CO2 by 2030, in line with the Net Zero Scenario milestones. Near- to medium-term priorities include promoting efficiency through fiscal and regulatory measures; stimulating investment in sustainable fuels; and developing alternatives to jet kerosene, such as battery electric and hydrogen-powered aircraft.

Activity

Passenger demand recovered gradually in 2021, with domestic traffic at 68% of 2019 levels and international traffic at just 28%. This represents an overall increase of 28% versus 2020, with traffic not expected to fully recover until the end of 2023. Air cargo, however, showed stronger growth in 2021, rising by nearly 7% above the pre-pandemic peak.

Post pandemic, the International Civil Aviation Organisation (ICAO) revised their projected annual growth to 2050 from 4.2% to 3.6%. Within the Net Zero Scenario a shift to high-speed rail, reducing business flights and a frequent flyer levy are used to reduce demand growth.

Global commercial passenger traffic, 2019-2021

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More recently, Russia’s invasion of Ukraine has dealt multiple blows to aviation through increased oil prices, modified flight routes, economic sanctions and repossession or writing off of aircraft leased to Russian airlines.

Energy

New aircraft are up to 20% more efficient than the models they replace, but this has been insufficient to keep up with growing activity. Between 2000 and 2010 fuel efficiency improved by 2.4% per annum, and by 1.9% from 2010 to 2019, demonstrating that additional incremental improvements are becoming more difficult. Meanwhile passenger demand grew at over 5% per year from 2000 to 2019, meaning that annual improvements are far below what is needed to align with the Net Zero Scenario.

Energy intensity of domestic and international commercial passenger aviation in the Net Zero Scenario, 2000-2030

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Technology Deployment

The commercial sale of sustainable aviation fuels (SAF) is subject to blending limits, but with 100% SAF flights completed and further trials ongoing, the sale of 100% SAF is expected soon. Increasing SAF use from less than 0.1% of all aviation fuels in 2021 to around 10% by 2030 in line with the Net Zero Scenario will require investment in production capacity and new policies such as fuel taxes, low-carbon fuel standards and mandatory blending.

Proposed EU legislation excludes purpose-grown crops from SAF due to sustainability concerns, and while cheaper and more mature, volumes of SAF from wastes are limited. Renewable synthetic kerosene is relatively far from commercialisation, with cost driven by the sources of CO2 and green hydrogen, but it is also highly scalable and has a far superior carbon balance than biofuels.

Incremental improvements to engines, aerodynamics and mild hybridisation can and should be implemented. However, “revolutionary” designs, such as new airframe configurations to enable further efficiency improvements, and electrified or hydrogen-powered aircraft, are needed to enable the significant CO2 emission reductions that could be realised in short- to medium-range operations by switching to alternatives to jet kerosene fuel.

Innovation

Hydrogen can be used via direct combustion in jet engines, through fuel cells to generate electricity for electric motors, or a combination of both. However, using hydrogen in aircraft poses a significant set of challenges including the need for innovative fuel storage and delivery methods, low-cost and lightweight cryogenic tanks, and redesigned airframes to accommodate them.

Airbus’s ZEROe is perhaps the most prominent programme, developing large hydrogen aircraft for commercial operation by 2035. Together with CFM, Airbus is building a jet turbine capable of combusting hydrogen. CFM, Airbus, GE and Safran are collaborating on a hydrogen-powered open-rotor engine demonstration programme for larger jets. Rolls-Royce is also researching hydrogen-powered engines for small aircraft, including narrow-body aircraft. Airbus is also investigating fuel cells, having ordered modular, scalable stacks for testing.

Other companies are designing smaller hydrogen aircraft, including retrofits and hydrogen tank-swapping concepts, with demonstrations planned for the near future.

Battery electric aircraft have no direct emissions, potentially much lower operational and maintenance costs (though this depends on battery durability), high efficiency and much lower noise emissions. However, current battery energy density and weight severely restrict the range of battery electric flights and the size of aircraft. Hearth Aerospace, using current state-of-the-art batteries, is aiming to design a 19-seater electric aircraft by 2026. More broadly, the number of competing prototypes is growing.

The energy density of today’s Li-ion batteries is around 200 Wh/kg at the cell level, but for short-haul flights over 1 000 km, a battery pack energy density of at least 800 Wh/kg would be needed.

Such designs may become commercially available in the 2030s. By 2040 they are likely to have a maximum range of less than around 3 500 km and hence serve flights that account for a maximum of about half of all fuel consumption in current commercial aviation operations.

Share of flights and fuel use in commercial passenger aviation, and alternative fuel technology options by range

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Share Of Flights And Fuel Use In Commercial Passenger Aviation And Alternative Fuel Technology Options By Range
Share of flights and fuel use in commercial passenger aviation, and alternative fuel technology options by range
Share Of Flights And Fuel Use In Commercial Passenger Aviation And Alternative Fuel Technology Options By Range
Supporting Infrastructure

Liquid hydrogen must be stored at airports and on aircraft at -253˚C, creating challenges in production, storage and logistics that will require significant investment in airport infrastructure. Potential changes in aircraft design itself (e.g. longer wingspan and fuselage) are also likely. Despite these and other challenges, Air Liquide and others are moving forward with plans to equip airports with the infrastructure needed to support the hydrogen aircraft seen in the Net Zero Scenario post 2030.

Policy

A growing number of regulatory frameworks, including Brazil’s RENOVABIO (certificate trading), California’s Low Carbon Fuel Standard (based on carbon intensity), and the European Union’s proposed ReFuelEU Aviation (a blending mandate), include incentives for SAF alongside the United States’ proposed SAF Grand Challenge.

Further, ReFuelEU includes a proposed obligation on aviation fuel suppliers to blend a minimum share of SAF into fossil jet kerosene, 2% from 2025, reaching 63% in 2050. The proposed regulation includes sub-targets for synthetic jet kerosene, which increase from 0.7% in 2030 to 28% in 2050. Individual countries, like Norway (30% SAF blending) and Sweden (27% greenhouse gas reduction), have introduced more ambitious mandates by 2030 (though in the case of Sweden, the ReFuelEU target may override the national mandate). The European Union already regulates intra-EU flights through its carbon emissions trading system. The introduction of a kerosene tax or bringing forward the date when airlines stop receiving free CO2 credits would substantially strengthen it.

International Collaboration

The ICAO Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), requires airlines to offset CO2 emissions growth above average pre-pandemic levels, covering all non-exempt international flights from 2027. ICAO approved six offset programmes for CORSIA compliance during the pilot phase, and the programme success will largely depend on the quality of these offsets, which are currently cheaper than SAFs, which can also be used to comply with CORSIA .

In 2021 IATA (International Air Transport Association) member airlines articulated a commitment to achieve net zero CO2 emissions form aviation by 2050, calling on ICAO to endorse their commitment. A representative body of around 290 airlines covering 83% of global air traffic, IATA aims to abate nearly 1.5 Gt of CO2 emissions from SAF (65%), new propulsion technologies (13%), and more efficient operations and infrastructure (3%). Residual emissions of about 300 Mt CO2 are to be dealt with using carbon capture and storage as well as offsets.

The Air Transport Action Group (ATAG), a coalition of aviation industry experts that consists of representatives from a wide range of industries related to aviation, has also laid out a pathway to net zero emissions by 2050 in their Waypoint 2050 report. Following the publication of two important roadmaps, Waypoint 2050 and Destination 2050 by the European industry, ICAO is expected to deliver a long-term aspirational goal at its 41st Assembly later this year in line with the Paris Agreement.

Private-Sector Strategies

Many airlines are partnering with suppliers to achieve their SAF goals. However, governments need to harmonise their approach to bridging the price premium, otherwise companies that use SAF face a competitive disadvantage.

Corporate signatories of the World Economic Forum’s Clean Skies for Tomorrow initiative have pledged their support for a goal to achieve a SAF blend of 10% in global jet aviation fuel supply by 2030.

Role 

Company or initiative 

SAF usage/ production target 

Target year 

Airlines, airports, logisticscompanies, fuel producers, customers and platforms 

Clean Skies for Tomorrow 

10% 

2030 

Logistics 

FedEx Corp 

30% 

2030 

Deutsche Post DHL Group 

30% 

2030 

Amazon Air

5% 

2030 

Airlines 

Alaska Air Group, Delta Air Lines, Finnair, International Airlines Group, JetBlue Airways, Malaysia Airlines, Qantas Airways, Royal Air Maroc, Sri Lankan Airlines 

 

10% 

2030 

Norwegian Air Shuttle 

16-28% 

2030 

Scandinavian Airlines System 

17% 

2030 

Ryanair 

12.5% 

2030 

Lufthansa Group 

5-10% 

2030 

Fuel providers 

Neste 

1.5 Mt 

2023 

Shell 

2 Mt 

2025 

OMV 

0.7 Mt 

2030 

Eni 

0.5 Mt 

2030 

Sources: BNEF and company announcements.

Recommendations for Policy Makers

Carbon pricing beyond the CORSIA scheme is critical to equitably reflect the negative externalities of air travel. Passing on costs to passengers can help curb demand growth, while revenues generated could be used to foster low-carbon innovation and address potential economic hardship faced by airlines.

Since frequent flyers likely account for around half of all aviation emissions, progressive tax rates that increase with flight frequency as well as higher taxes on business and first class tickets could discourage excessive flying, especially as jet kerosene is taxed at lower levels than automotive fuels in many jurisdictions.

Policies are needed to support SAF consumption and boost demand growth, which are required to realise economies of scale. Action from leading airports can generate the market pull that is needed to catalyse SAF adoption too.

Funding and financial de-risking will be needed to promote continued innovation around sustainable production processes including novel feedstocks (wastes, residues, marginal land, double cropping) and to promote the leap from demonstration to commercial plants. It will also be needed to drive investment at all stages of research, development and deployment, to enable power-to-liquids (i.e. synthetic) jet kerosene to scale up rapidly.

On the demand side, low-carbon fuel standards and blending mandates provide clear long-term demand signals beyond offtake agreements. In all cases sustainability guardrails must be established and enforced to avoid other environmental or social impacts while increasing supply.

While offsetting could be useful to compensate for any residual emissions, the member states of ICAO should ultimately try to address all emissions generated within the aviation sector.

SAF is eligible under CORSIA as a means to directly reduce emissions. Robust GHG modelling and certification requirements for SAF have been built into the scheme; this regulatory framework can be leveraged and improved further by national policy frameworks seeking to promote SAF. Only once CORSIA can effectively ensure that both offsets and SAF used for compliance offer additional and robust life cycle emission reductions will it offer a genuine avenue for decarbonising aviation.

Recommendations for the Private Sector

Providing customers with the option to pay extra for SAF, and facilitating other offsets, can stimulate demand. For those residual emissions that are particularly difficult to reduce via technical or policy measures, airlines and consumers can follow through on their “green” signalling by purchasing offsets on international carbon markets.

Action from leading airlines and airports that serve as key international and domestic hubs can generate the market pull that is needed to catalyse adoption of efficient operations, best-in-class technologies and SAF. Those that act early will benefit not only from asserting their leadership in corporate social responsibility, but from being the first to gain experience in innovative practices and technologies that will eventually need to be taken up more broadly.

Acknowledgements
  • Lynnette Dray, University College London, Reviewer
  • Till Bunsen, International Transport Forum, Reviewer

Analysis