CORSIA adoption momentous but is just the start of the environmental long-term challenge, says airline chief
(photo: Heathrow Airport)
Mon 5 Feb 2018 – The adoption in 2016 by ICAO States of CORSIA had been momentous, IAG CEO Willie Walsh told the recent Aviation Carbon 2017 conference, and urged governments to support the international carbon offsetting scheme from the start and airlines to start preparing for its introduction. However, he said, it was just the beginning of the environmental challenge facing the industry and he foresaw the need for a market-based measure continuing well beyond CORSIA’s planned end in 2035 as well as a step-change in aircraft technology and the ongoing development of sustainable alternative fuels. The industry had to demonstrate both financial and environmental sustainability or it will decline, he warned. Tim Johnson of the Aviation Environment Federation (AEF) said recent research suggested it would be difficult for industry emissions growth to be funded through the carbon markets on a long-term basis and the focus had to be on decarbonising the sector.
Emitting 814 million tonnes of CO2 by the airline industry in 2016 was a significant and growing contribution to global man-made warming despite ongoing efficiency improvements, Walsh said in a keynote opening address at Aviation Carbon 2017. At 2.8%, he reported, the industry was ahead of its short-term 1.5% average annual fuel efficiency improvement target but faced a very challenging long-term goal of halving net carbon emissions by 2050. It would be spending trillions of dollars in new aircraft, more efficient operations and technologies like sustainable alternative fuels, he said, but the goal was unlikely to be achieved without the need for a market-based measure (MBM). In the absence of a single global mechanism, a patchwork of different measures would also create perverse and inefficient outcomes, he argued.
Michael Gill, Executive Director of the cross-sector Air Transport Action Group (ATAG), told the conference a global MBM had been a fundamental part of the industry’s global climate strategy since 2009 and had pushed for an agreement at ICAO that would avoid the patchwork.
“We have seen the danger of a patchwork of measures in other areas of aviation – the rise of passenger rights regulations around the world is just one example,” told delegates. “The ICAO resolution intends CORSIA to be the single global measure to address international aviation CO2 emissions and that is certainly the industry position.
“Since the resolution was adopted we’ve seen proposals in Sweden, the Netherlands and Colombia for national measures to address aviation CO2 impact that we are trying to avoid. And, of course, there is the continuing uncertainty over the application of the EU ETS to international flights in the post-2020 CORSIA environment.”
Gill said there was still a lot of work still to be done on CORSIA implementation but the industry was committed to working with all aircraft operators to ensure capacity building and training is carried out. As well as his ATAG role, Gill is also Director of Aviation Environment at IATA.
“We are undergoing work at the moment to identify and capture not just the 280-strong IATA membership who have been closely involved in the CORSIA discussions but also the broader airline community. As we don’t quite know the final number of States that will have volunteered to participate from the start, it’s a challenging and ongoing task,” he said in a panel session.
“We are also continuing to work with governments to try and raise the number of States volunteering. There are a number of significant aviation players that have not yet done so and we would like to try and change that in the coming years before the scheme comes fully into effect.”
Also participating in the session, Bruce Parry of the European Business Aviation Association (EBAA) said up to 200 business aircraft operators could be impacted by CORSIA. However, he added, there were many more that were close to the 10,000-tonne annual international CO2 emissions threshold and they may have to be introduced into the system in case their operations increased over the coming years. The business aviation sector was actively engaging with operators on CORSIA, he reported.
Gill said it was a huge challenge in getting airlines and operators up to speed on CORSIA in such a short time.
“We are running an ambitious series of capacity-building workshops with the airline and business aviation communities to make sure they know the processes and systems they need to put in place and the obligations they have under the CORSIA system. IATA is working on a number of tools to help facilitate the reporting process for all airlines. It’s a big undertaking but one we’ve decided to put a high priority on, both within ATAG and IATA.”
Although CORSIA had become the main focus of the industry’s four-pillar climate strategy, once it has come into effect, “it will become part of airlines’ day-to-day operations, as long as we get the framework and implementation rules right,” he said.
Tim Johnson of the AEF, which is a member of ICSA, the NGO group represented at ICAO, said the short space of time for the aviation industry and States to prepare for CORSIA was a cause for concern. Operators will have to work out reporting methodologies in 2018, with reporting requirements starting in 2019, he said, and a large number of States will have to enact legislation very quickly to make this possible.
“What you have in CORSIA at the moment is a high-level political agreement,” he told the conference. “Although a lot of good technical work has taken place, you still need a political buy-in to make it happen. Our concern is that as you try to negotiate this, you go for expediency over content because of the urgency.
“We want to ensure that the technical evaluation and recommendations are adopted by States. We appreciate the need for urgency but not at the expense of content.”
Johnson said an opportunity had been missed to send an early signal to the carbon markets that would have provided them time to prepare and ensure the aviation sector got what it needed. “We must have confidence in the units used in CORSIA, that they are the best you can buy, deliver sustainable benefits and that there are enough of them,” he said.
Willie Walsh, CEO of International Airlines Group and a long-standing member of IATA’s board of governors, told delegates a global market-based measure is here to stay. “There has to be some form of MBM to continue beyond 2035 and maybe 2050 as well.
“I believe CORSIA is a good first step, it’s part of the industry’s climate solution but is clearly not the whole answer. We need to look beyond 2035 and the industry won’t stop operating in 2050 so we need to do more after that. New technology, including sustainable alternative fuels (SAF), will be part of the solution, with maybe electric and hybrid technology being introduced in the next 15 to 20 years, perhaps shorter in business aviation. We would be fooling ourselves though to think SAF is the answer as it won’t be able to provide all our fuel requirements, but it will be significant.”
Walsh said a step change in technology would be needed past 2050 and that platform would need to be identified within the next 10 years.
He added: “Investors are asking more questions about what we are doing on the environment and the industry is being challenged more openly on it. Airline CEOs are becoming much more aware. I’m not saying everyone but I do believe that over the past 10 years, the participation in the debate around this issue has significantly improved.
“If you can’t demonstrate your industry is sustainable on an environmental basis it won’t be able to continue. The measures we are taking provide us with a path to a sustainable future from an environmental point of view. If we fail on that path then the scale of activity for aviation will have to reduce. We have to demonstrate both financial and environmental sustainability or the industry will decline.”
Right to left: Willie Walsh, IAG; Michael Gill, ATAG; Tim Johnson, AEF; and Bruce Parry, EBAA: