European aviation alone is expected to spend “a whopping €820 billion” to reach net zero, Bloomberg reported. Factors include changes to the European Union’s Emissions Trading System (EU ETS), and the need to invest in cleaner technologies, all of which will dramatically slash profit margins.
Until airlines can fully decarbonise, these pressures mean “waving goodbye to the low prices that made globetrotting accessible to millions of people”, said Bloomberg. With summer flights already a third more expensive than last year, according to travel search engine Kayak, returning to the pre-pandemic norm of cheap flights is increasingly looking like a long shot.
Looming on the horizon are changes to the terms of the EU ETS. Under this scheme, airlines operating within the European Economic Area (EEA), as well as the UK and Switzerland, are required to cover every tonne of carbon dioxide emitted with permits.
The EU provides roughly half of these free of charge, but a law change agreed in December means free permits are being phased out. These will be cut by 25% in 2024, then 50% the following year, before being phased out entirely by 2026, giving airlines “a financial incentive for them to pollute less”, Reuters reported at the time.
ustainable Aviation, an industry alliance comprising airlines, airports and manufacturers, is banking heavily on sustainable aviation fuel (SAF) produced from sources like agricultural waste. They believe this will account for at least three-quarters of the fuel used in UK flights by 2050.