Key themes from the IATA World Sustainability Symposium

Sustainability Partner Caroline May and Aviation Finance Partner Andrew Williams joined 500 delegates from the aviation sector who met in Madrid recently for the first IATA World Sustainability Symposium (WSS). Representatives from across the industry, including airlines, airport operators, ground handlers and fuel storage, trading and suppliers gathered to discuss common issues and challenges in the race to achieve net zero by 2050.

IATA Director General, Willie Walsh, opened the keynote session by underlining the aviation sector’s commitment to net zero by 2050, and highlighted the need for collaboration across the industry, whilst recognising the huge challenges posed. He highlighted the need for consistent regulation to provide a sound framework for innovation, investment and development, pointing out the need for subsidies in Europe, especially in respect of sustainable aviation fuel (SAF) production, which are lacking compared to the incentives provided in the US through the Inflation Reduction Act.

Walsh observed that other emerging market sectors, for example, renewable energy, had been the recipients of subsidies at the outset to assist market development and he stressed the need for governments to do more to assist the aviation sector, and to recognise the role it plays in meeting their national net zero commitments.

Sustainable aviation fuel (SAF)

A comparison of various different published “roadmaps” to net zero showed that every one recognised increased use of SAF as the most critical aspect of the aviation industry’s ability to achieve net zero by 2050. However, there are significant issues with the manufacture, production and supply of SAF in the current market, and prevailing regulatory conditions. The WSS was told that it takes between 5 and 7 years for SAF production sites to come onstream – to meet global demands there will need to be a very significant increase in the number of sites. Regulatory reform will need to be expedited if this demand is to be fulfilled, including policy and legal changes, and there needs to be a huge increase in available finance. Airlines are committed to purchasing as much SAF as can be produced, but at what cost? We heard from one airline chief executive that, at current prices, fuelling that airline’s fleet entirely with SAF would result in a fuel bill that exceeded the airline’s total revenues. We may see the cost of air travel becoming more expensive in the future to help bridge this gap, unless governments can provide greater subsidies and frameworks to enable a level or more incentivised playing field for SAF.

New, more efficient fleets

New and more energy efficient fleets also have a crucial role to play in reducing carbon emissions, and continuing, enhanced research and development into other alternative technologies is required. For example, the first electric powered small aircraft are currently participating in research programmes, and there is a significant focus on the use of hydrogen as a fuel source. Although the use of alternative fuels are the most obvious way to meet targets, there are other associated issues which research into should be happening now to avoid delays if solutions are identified, for example, changes to airport infrastructure and supply lines.

Political alignment and collaboration

It was noted that there are easier gains, which can be achieved with collaboration and political will. More efficient air traffic management and the implementation of initiatives aimed at protecting the environment, such as the long-awaited Single European Sky (SES), is estimated to achieve a reduction of 12% in CO2 emissions in Europe using existing aircraft technology. The only barrier to this is collaboration between Member States, and Willie Walsh urged governments in Europe to do more towards this aim. Europe is not alone – in the US delegates noted that similar proposals met similar challenges at State and Federal level.

Conclusions

Airlines are under huge pressure from customers, suppliers and stakeholders to be more sustainable; it is the only future for aviation, which can only be achieved by collaboration across all areas of the industry. However, with greenwashing allegations on the rise, and more and more scrutiny of sustainability credentials by both regulators and consumers, the industry needs to move both quickly and carefully.

Given the challenges, the mood at the WSS was positive and optimistic, and the industry looks forward with confidence to the next IATA WSS, to be held in Miami next year.