ESG in the European aviation sector: the contribution of the new regulation on the “ReFuelEU aviation” initiative

The demand for ESG standards in the aviation sector is no longer a new debate, since the various players in the sector (airports, aircraft manufacturers, carriers, subcontractors) have made it an imperative for many years. Admittedly, some will say that the measures taken are cosmetic in comparison with the demands for carbon neutrality by 2050 when they demand for the elimination of air travel as a means of transport. But it is not seriously conceivable to eliminate this mode of transportation within the European Union, with its 450 million inhabitants, when the distance between Dublin and Athens is 3800 km, or when a region of the Union needs to be opened up to prevent it from dying out. To be clear it is not a question of making aviation sacred, but of recognizing its benefits, while making thoughtful use of it.

Indeed, let’s not forget that we need to make effective the right to travel within the European Union, as set out in Directive 2004/38/EC.

It’s a matter of enabling EU nationals to work or facilitating intra-European family reunification, in line with the Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of December 9, 2020.

For this reason, the “ReFuelEU aviation” regulation of October 9, 2023 relies on the premise that the more sustained use of renewable and low-carbon fuels, will enable the aviation sector to reduce its carbon footprint and create a level playing field for sustainable air transport in the EU. However, this regulation will not enable us to fully meet the requirements of the objectives set for 2050 if it is not implemented swiftly and smartly.

Firstly, the Commission must ensure that all aircraft operators comply with the new regulations. The agreement is binding on the 27 members of the Union, but not on non-member states. It would therefore be desirable for the European regulation to be the working basis for an international agreement, especially as SAF can be produced anywhere on the planet.

Europe cannot be alone in driving decarbonization policies through SAF. It must be an international approach. The environmental issue is global, not regional. Moreover it is not viable to set up a system that penalizes European companies alone.

Finally, let’s not forget that the porosity of public opinion will sooner or later force non-European companies to justify their zero-carbon policy.

Secondly, this sustainable fuel must be available in sufficient quantities to meet demand. Production plants must notably be built in Europe to meet demand throughout the Union. Appropriate infrastructures must therefore be envisaged within a fairly short timeframe, which presupposes a European public policy and, with it, the necessary industrial incentives. To date, SAF is only available for 0.01% of the world’s aviation needs. Admittedly, the international air transport association (IATA) says it has counted more than 130 renewable fuel projects announced by over 85 countries, which would enable the production of 24 million tons by 2030 . However, it points out that this encouraging figure will only become a reality if each ICAO member country takes the necessary steps to ensure that aviation receives its share of SAF. To achieve this, we need industrial cooperation between EU member states. The aim of this industrial cooperation is to pool our know-how in order to optimize the technical level and quality of production, shorten lead times and provide a supply throughout the Union.

Thirdly,

Sustainable fuel is currently five times more expensive than kerosene. The very high cost is explained by the fact that demand far outstrips supply on the one hand, and that producers have to absorb the initial investment effort on the other.

All the countries of the European Union need to adopt a coherent policy to foster private investments.

In conclusion, one cannot deny decarbonizing air transport is an ecological necessity.  Still, for the sake of both effectiveness and fair competition, EU member states must bear in mind that regulation alone is not sufficient – it needs to be smart too. It’s an opportunity for the Union to take the lead in a significant international policy for clean aviation, and to draw in the United States, China and India in particular.