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The International Air Transport Association (IATA) on 4 October this year has committed to achieving net-zero carbon emissions by 2050. This is no small undertaking: it will require the co-ordination of all industry stakeholders to mitigate an estimated 1.8 gigatons of carbon at an estimated cost of 2 trillion USD. This commitment will align with the Paris Agreement goal for global warming not to exceed 1.5°C.

How will this be done?

Though technological breakthroughs, increased supplies and the more cost-effective solutions will emerge between now and 2050, the industry expects that emissions will be abated in the following ways:

Sustainable aviation fuels (SAF) (65%)

Production of SAF needs to increase a staggering nearly 4500 times by 2050 (from 100 million litres to 449 billion litres). The IATA points to other sectors, such as wind power generation, to suggest that such increase is not unprecedented. British Airways, which already had a commitment to be net-zero by 2050, operated its first carbon-neutral flight by running on SAF in September this year.

New propulsion technology (13%)

The use of electric, hybrid, then eventually hydrogen propulsion could start in regional and short-haul services by 2030 or 2040. EasyJet is already working with American company Wright Electric to develop an all-electric 186-seater aircraft, aiming to ground test in 2022 and flight test in 2023. However, despite being the second largest contributor to expected emission reductions, IATA asserts that it is not reliant on these new technologies to meet net-zero.

Other efficiency improvements (3%)

These include changes such as retro-fitting winglets, light-weight seating, fuel efficiency management systems, reduced engine taxiing and air traffic management programs such as Single European Sky and NexGen.

Carbon capture and storage (11%) and Offsets (8%)

The industry expects that its use of offsetting will diminish dramatically from 97% reliance in 2025 to 8% reliance in 2050. Types of offsets are also expected to evolve over the years, particularly in carbon capture technologies which may even become a carbon-negative option.

Who will be involved?

IATA’s resolution ‘demands that all industry stakeholders commit to addressing the environmental impact of their policies, products, and activities with concrete actions and clear timelines’. This will include:

  • Governments providing policy support, particularly of SAF;
  • The oil industry supporting cost-competitive production of SAF;
  • Corporates boosting SAF purchase agreements;
  • Researchers fast-tracking research and development on electric/ hydrogen aircraft;
  • Manufacturers accelerating research on airframe designs and electric/ hydrogen propulsion;
  • Air Navigation Service Providers implementing and updating programs and collaborating on efficiencies;
  • Investors and the carbon markets innovating new financial products to de-risk investment;
  • Airlines investing in new technologies and incentivising positive passenger behaviours; and
  • Passengers supporting the industry’s efforts.

Achieving this goal

IATA’s resolution is not the first initiative by major carriers to reduce carbon emissions. Some airlines, such as Virgin, have been supporting the development of SAF since as early as 2008. Others, such as QANTAS, had in 2019 made the commitment to be net-zero by 2050.

Nevertheless, efforts undertaken by the 58 biggest airlines to reduce emissions amounted to an improvement of merely 1% between 2017 and 2018, while the industry as a whole increased emissions by 5.2% over the same period.

Although the COVID-19 pandemic has meant that, with reduced flights, emissions have also significantly, if temporarily, reduced, it has also caused losses to the industry exceeding 200 billion USD. In light of this and the flagging results of past efforts, the airline industry’s new commitment is truly both ambitious and challenging. However, in the words of IATA Director General Willie Walsh, it is also ‘realistic’: I think the significant development today was recognition by all airline CEOs that not only is this the right thing to do but we must do it. If we want to continue to provide our services we have to continue to demonstrate that we’re improving our environmental performance… I’ve no doubt the airline industry will demonstrate once again how it can drive innovation for the benefit of not just our industry but other industries.

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John Angus

Partner, Sydney

John Angus