T+1 Operational Impacts: Today and Beyond
Incorporating 50% of biofuels in aviation fuel from 2030 could allow a 40% reduction in French CO2 emissions in the sector, and pave the way towards the newly set objective of a zero carbon aircraft by 2035.
As the need to urgently limit the scale and consequences of climate change is vastly acknowledged, environmental concerns are now at the heart of public debate internationally and in France. The general public, non-governmental organizations, and more and more private actors call for firmer commitment from public authorities in favor of climate.
According to the International Energy Agency, global aviation accounts for around 2% of global CO2 emissions. The sector has been under strong scrutiny and the global crisis caused by the spread of the COVID-19 virus have catalyzed this trend. With the aviation sector having suffered so much from a paralysis lasting for several months, the question of a green recovery arises more than ever.
At the beginning of the year, France released its roadmap, moderately ambitious, for the deployment of aviation biofuels. But the French Government recently announced the goal to develop a zero carbon aircraft by 2035, confirming both that the climate emergency has been taken into account and the importance of aviation to achieve a successful energy and climate transition. Hydrogen will likely power the above-mentioned aircraft, representing a long-term solution for the sector's low-carbon transition. In the meantime, the incorporation of biofuels in aviation fuel is currently the most realistic medium-term solution: it is economically more acceptable, requires limited adaptations of the value chain, and has lower technical barriers than other technological developments considered.
Global warming, mainly caused by greenhouse gases (GHG) emissions, endangers the planet's ecosystems. With a quarter of global CO2 emissions, the transportation sector is the 2nd most emitting, just after the power and heat production sector. As opposed to the road transport sector, aviation has only been submitted to few measures aiming at reducing its environmental impact, unlike road transport. In addition, the growth of air traffic, which should double between 2017 and 2037 (source: IATA), could dramatically increase the sector's carbon footprint if no further action is taken.
In order to meet climate requirements and answer to the growing public environmental concerns, aviation actors, mainly in Europe, have recently announced targets for reducing their CO2 emissions. The main current lever is carbon offsetting, which airlines already use.
To go further and reduce the sector's carbon footprint in an absolute and non-relative way, only a few technological solutions are conceivable today without limiting the number of flights :
Resuming activities after the health crisis due to COVID-19 and keeping businesses afloat represent major challenges for airlines. The French recovery plan for the aeronautical industry sets a more virtuous course with the development of a low-carbon aircraft in 2035. Aviation biofuels thus constitute a transitory solution towards tomorrow’s decarbonated aviation.
Since the first experimental flight took place in 2008, the aviation biofuels sector has developed slowly over the successive certifications of production processes. Most of the technical barriers to biofuels integration have now been lifted and the industry can rely on the existing fuel supply chain. Today, the remaining efforts mainly lie in the value chain upstream stages: input collection (with input availability as a limiting factor) and fuel conversion methods. Despite this favorable situation, biofuel use in flight still remains marginal today.
Like road biofuels, aviation biofuels are classified into 3 generations associated with different input profiles. The 2nd and 3rd generations, the most advanced and sustainable (2G - 3G) allow greater CO2 reduction while avoiding the mobilization of arable land (1G). However, without any financial support mechanism or a higher carbon price, aviation biofuels remain 2 to 5.5 times more expensive than fossil fuels, making it the main obstacle to their development (considering all CAPEX and OPEX costs associated with the production, including equipment purchasing costs, installation and planification, costs of inputs and other operating costs).
Working like PPAs (Power Purchase Agreement) for renewable energies, partnerships signed between airlines and producers are the main development boost of the biofuels sector today. These supply contracts provide medium and long-term prospects for the sector, with volumes reaching 900 million liters per year after 2025. However, these volumes are still very limited in comparison to the 350 billion liters of aviation fuel consumed in 2017 worldwide.
The French roadmap for aviation biofuels deployment, released at the beginning of the year, planned their gradual incorporation until reaching 50% of aviation fuel by 2050.
Sia Partners recommends an ambitious but realistic scenario aiming at the incorporation of 50% of biofuels from 2030, allowing a 40% cut in the aviation sector CO2 emissions in France, for an average additional cost per ticket estimated at €5, according to our assumptions. This scenario would allow a significant reduction of CO2 emissions at an acceptable cost, while ensuring the availability of different selected inputs.
The scenario proposed by Sia Partners is consistent with the Government's new announcements from the post-COVID-19 recovery plan, aiming in particular to develop a zero carbon aircraft in 2035. In the meantime, the development of aviation biofuels stands out as an adequate transition solution, with the acceleration of massive incorporation sooner than the objectives initially set. In this perspective, post-COVID-19 recovery should represent an opportunity for the sector, driven by the Government, to rebuild itself in a more sustainable, resilient and respectful way.