The explorer Levison Wood argued recently in a Times interview that a solution to global deforestation was to “get on a plane”, an unlikely answer from someone who believes “the economic system is totally unsustainable.” His opinion is that aviation is less of a sustainability challenge than, say, population growth or our Western diet.

Moreover, travel, including aviation, is not all negative. It has positive spin-offs, bringing cultural benefits and boosting the tourism sectors in developing countries. An academic study in 2016 by Joseph Shapiro argued that the gains from international trade (inevitably involving transport) outweigh emissions-related climate damage by a factor of over 160-11.

So, what are the facts? At the sector level, air travel accounts for just under 10% of global transport-related CO2 emissions (road transport nearly 75%). Aviation amounted to just 2% of total energy-related CO2 emissions in 2022 (all figures from the International Energy Agency). Adjusting for other greenhouse-gas effects, including the white contrails we see etched against the sky, suggests that aviation has accounted for 4% of the 1.20C global warming increase experienced on earth since the Industrial Revolution.

The most urgent question we should ask ourselves, then, is can we fly without impairing the planet’s atmosphere?

The first challenge is simply that we love flying. Passenger traffic is set to grow at 3.6% p.a. in the coming decades (according to Airbus) – implying total traveller numbers doubling in 20 years. That growth dwarfs any foreseeable fuel efficiency gains, historically running at 2% p.a. Hence, aviation’s relative climate impact may increase in future decades, as other sectors decarbonise while the airline industry booms.

Alas, decarbonisation pathways being rolled out in road and rail – involving significant electrification - have limited relevance in aviation in terms of technologies that are available commercially today, although the first all-British electric aircraft made a test flight last year in a project managed at Cranfield University. While there is scope for electrified rail to substitute for flying on some inter-city routes, we are of necessity driven to Sustainable Aviation Fuels (SAFs) to quench our thirst for travel.

Today, these molecule-based approaches - hydrogen, ammonia, synthetic e-fuels and biofuels - are in their infancy. In 2022, SAF fuel production amounted to just 0.24m tonnes, a mere 0.1% of the overall volume of jet fuel (according to the International Air Transport Association). Each option brings challenges in terms of economic costs, resource availability, barriers to scaling, infrastructure deficiencies, supply chain bottlenecks, ‘blending constraints’ when mixed with conventional fuels, and drawbacks relating to aircraft design.

For example, a recent Royal Society report estimated that, even if we confine ourselves to UK jet-fuel demand, supplying it through biofuels would require over half of the country’s agricultural land! Using synthetic e-fuels would imply the development of green hydrogen and Direct Air Capture (DAC) of CO2 at scale as ‘feedstocks’. Both are currently infant industries. Moreover, using either biofuel or e-fuel pathways requires complex carbon accounting to ensure climate neutrality.

Alternative SAF pathways involving hydrogen (or ammonia) involve no CO2 emissions at the point of use, but have scaling and supply-chain issues, and require significant modification of infrastructure and airframes. The scale challenge is huge – the electricity required to produce sufficient green hydrogen to replace the UK’s current aviation fuel consumption would require 2.4-3.4x the UK’s combined wind and solar electricity output.

So, where does all this leave us? The honest answer is a long way from home.

Long-haul flights raise the hardest issues, given the almost complete lack of substitutes. For the UK, with its small land area, the vast majority of aviation emissions come from international flights (over 95% on Department for Transport figures).

To put this in context, on a per person basis, making one return intercontinental plane trip per year, say London to Cape Town, has the same annual CO2 imprint as the CO2 emissions from driving 40km, every day of the year, in a petrol-fuelled car (my estimate). If forced to choose, would you sacrifice the annual pleasure, or the daily commute?

Any solution to long-distance air travel is as much about economics as engineering. CORSIA (a United Nations Carbon Offsetting Reduction Scheme for International Aviation with 125 voluntary participants) aspires to keep all growth in international flights from 2020 ‘carbon neutral’. Currently it is in a pilot phase and has been the subject of some criticism.

Yet markets evolve over time and may advance quicker than emergent technologies. We should not let perfection be the enemy of the good, especially when our options are limited. So, in aviation, our best hope is for government policy to support research and development, buttressed by support for market mechanisms to guide larger-risk investments and customer decisions. In short, that means carbon pricing!

Possibly the worst thing for society to do is to pick winners early in the race to ‘jet zero’. It amounts to trying to fly without wings - never a good idea, especially at 30,000 feet.



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Disclaimer: The blog does not aim to give investment advice, but is designed to afford relevant longer-term context to investors, encouraging a broad perspective where uncertainty is high and a spirit of learning is important. The views expressed are those of the author, not those of Investec.