“While the Covid crisis has compelled us to make many changes across the business, one thing that hasn’t changed is our commitment to minimising the impact we have on the environment,” commented Andrew Parker, Qantas Group Executive, Government, Industry and Sustainability. “Even though we have been flying a lot less, we’ve actually seen the same proportion of customers choosing to offset their domestic travel during the pandemic – showing this issue remains top of people’s minds.

“Airlines globally have a responsibility to cut emissions and combat climate change, particularly once travel demand starts to return. The Qantas Group has set some ambitious targets to be net carbon neutral by 2050 and while offsetting emissions is a big part of that in the next few years, longer term initiatives like building a sustainable aviation fuel sector in Australia, are key.”

The airline group claims to operate one of the industry’s largest carbon offset programmes, with around 10% of customers booking flights on its website opting to offset the emissions from their flights. In turn, both Qantas and low-cost subsidiary Jetstar match every dollar spent by customers.

“We think the programme can grow and we have a lot of corporates, not just individuals, signing up for it,” Qantas CEO Alan Joyce told a recent Eurocontrol Aviation StraightTalk interview (see video below). “Sustainable aviation fuel (SAF) is going to take a while to get established and make it economic.”

He said Qantas would be working on a plan with BP to create a local SAF industry to help it meet the 2050 target. “BP think it’s a great opportunity. In Australia we have a massive land mass and our airline, pre-Covid, was spending $4 billion a year on fuel. There’s potential for an industry here in Australia that we’re excited about developing.”

Commenting on the tie-up with Qantas, BP’s EVP, Regions, Cities & Solutions, William Lin, said: “At BP, we’re focusing on working with corporates in key industrial sectors that currently have significant carbon emissions to manage and need to decarbonise – sectors such as aviation.

“By bringing our complementary capabilities together, we can help each other, and our customers, move at a faster pace on the energy transition journey. We are delighted to have the opportunity to collaborate with Qantas on plans to reach net-zero while continuing to deepen our existing relationship.”

Frédéric Baudry, President, BP Australia and SVP Fuels & Low Carbon Solutions, Asia Pacific, said: “This is another move towards our ambition to be a net-zero company by 2050 or sooner and help the world to get to net-zero. We believe the planet needs everyone working together on this vital cause, and that supporting companies to transition to a more sustainable future means we can all get there faster.

“Forming strong strategic partnerships with leading companies like Qantas is an important way to achieve our shared goals and we are proud that BP is working to provide decarbonisation solutions for customers in Australia.”

Photo: BP

Excerpt of interview with Qantas CEO Alan Joyce talking about sustainability and SAF:

With a fleet of six freighter aircraft and 172 long-haul passenger aircraft and hubs at Paris Charles de Gaulle and Amsterdam Schiphol, Air France KLM Martinair Cargo flies around 1.2 million tons of cargo a year. Customers will not only help pioneer the use of SAF in the aviation industry but will also scale up the SAF market by investing in the Cargo SAF Programme, says the group. When contributing, customers receive a third-party audited report, justifying the purchased volume of SAF in relation to traffic and indicating the reduction in CO2 emissions achieved.

“Our commitment to reducing CO2 emissions is one of the cornerstones of our cargo strategy,” said Adriaan den Heijer, EVP of Air France-KLM Cargo and Managing Director of Martinair. “The launch of a SAF programme for airfreight is an important step in our ambitious sustainability roadmap for the coming years. I invite all our customers to join us in creating a more sustainable cargo future.”

KLM already operates the Corporate BioFuel Programme that enables businesses with a corporate contract with the airline to offset the CO2 emissions from business passenger travel using SAF. Partners in the programme pay a surcharge that covers the difference in cost between biofuel and traditional fossil-based kerosene.

Lufthansa’s ‘Miles & More’ passenger customers can now compensate for their CO2 emissions as the app has integrated the Group’s Compensaid compensation platform, which was launched in 2019. Customers can see the CO2 emissions of their flight in the Miles & More app and offset them directly using their airmiles or with a charge in euros. The customer can decide whether to offset through the use by the airline of SAF or through certified reforestation projects of the myclimate foundation. The enabling application is called ‘mindfulflyer’ and was developed jointly by Miles & More and the Lufthansa Innovation Hub. With the mindfulflyer function, participants can be reminded regularly to compensate their flights.

Similarly, Lufthansa Cargo customers from next summer’s flight schedule are to be offered CO2-neutral airfreight on a regular basis by offsetting emissions through either myclimate’s reforestation projects or SAF. If SAF is used, Compensaid ensures the sustainable fuel is purchased to compensate for the resulting emissions, which is undertaken in conjunction with Lufthansa Group Fuel Management and SAF manufacturers. Compensaid’s digital technology makes the process from calculation to fuelling both transparent and efficient, reports Lufthansa, which guarantees purchased SAF is put into circulation within six months.

“CO2 compensation in the business customer sector is an important and effective step towards CO2-neutral aviation,” said Gleb Tritus, Managing Director, Lufthansa Innovation Hub. “Through the larger B2B volumes, we are increasing demand and thus promoting awareness, availability and cost-effectiveness of alternative fuels.”

Lufthansa Cargo has aligned its corporate responsibility commitment with five of the 17 UN sustainability development goals (SDGs) and has committed itself to anchoring the selected sustainability goals in its corporate activities and to making a substantial contribution to achieving them by 2030.

“Lufthansa Cargo supplies people and markets with urgent goods and raw materials. We are part and driver of globalisation, which stands for economic progress and opens up new opportunities for every individual. And that does not exclude sustainability,” said Peter Gerber, CEO of Lufthansa Cargo. “We will focus more strongly on it, both in an economic and social sense. In addition to investments in a modern freighter fleet, our commitment to alternative fuels also contributes to the UN’s ‘Climate Action’ sustainability goal. Through the possibility of using SAF, we are actively driving forward research in this area and can thus relieve the environment in the long term.”

Photo: Lufthansa Cargo’s first SAF CO2-neutral flight in partnership with DB Schenker

Although Covid-19 has drastically reduced travel, it is too early to say whether there will be a change in the way we travel in the future but the current situation is an opportunity for a fresh start, one that is greener and sustainable, believes David Hild, CEO of the Fly Green Fund.

“Travelling not only enables trade and the spread of new technologies, but it also broadens perspectives and our understanding for other cultures. I am convinced that travel makes the world a safer and a more open place,” he said. “Still, we need to recognise the impact travelling has on our climate and take action to mitigate it. An easy way to reduce emissions from flying is to buy sustainable aviation fuel.”

The scheme uses a carbon calculator on its website to work out the emissions on a particular flight and a cost to offset them using SAF. The traveller can adjust a slider up or down to choose the amount he or she wishes to pay. Three-quarters of the money paid to the Fund is used to buy SAF for delivery at Swedish airports, the remainder to develop the market and support initiatives to help increase demand and local production of SAF in Scandinavia. Payments from the travelling public go through a Swedish mobile payments system in local currency but Hild says the Fund will soon be accepting payments in euros to broaden its market.

The SAF deliveries this year have gone to Sundsvall-Timrå, Helsingborg Ängelholm and Kalmar Öland airports, and marked the first-ever use of SAF at the first two airports. The SAF supplied by truck to the airports was blended 34/66 with conventional fuel before entering the airports’ fuelling systems.

“We are replacing fossil fuel with SAF, thus reducing the impact of our customers’ flights. At the same time, we are increasing the demand for SAF and spreading knowledge about its importance to get aviation on track to meet its climate goals,” said Hild.

“The challenge is increasing the supply. Limited production means the price of SAF is about three to four times higher than conventional fuel, which in turn limits the demand. However, the higher focus on climate change has meant more airlines are interested in investing in SAF.”

Photo: Kalmar Öland Airport

Abu Dhabi-based Etihad has partnered with Respira for its Greenliner carbon offset programme and will initially purchase 80,000 tonnes of CO2 offsets in a Tanzanian forestry project. The Makame Savannah REDD project, developed by Carbon Tanzania, employs a community-based model to curb deforestation and promote better management of local natural resources across over 100,000 hectares in the southern extension of the Tarangire-Manyara ecosystem.

The scheme is verified and certified by Verra under its Verified Carbon Standard to ensure the carbon offsets are quantifiable, additional and fully sustainable. The scheme’s first offset vintages were certified in early November 2020. The Tanzanian project also conforms to Climate, Community and Biodiversity (CCB) Standards, which protect endangered species and local communities.

“Respira offers a fresh approach to the carbon market by aligning the interests of project developers, buyers and capital providers,” said Ana Haurie, CEO of Respira. “In this way, we create win-win outcomes for all stakeholders. It is a privilege to work with Etihad, which has shown real commitment to its sustainability goals through what is a challenging period for the airline industry.”

To support Etihad and Abu Dhabi’s long-term sustainability objectives, Respira will establish operations at the Abu Dhabi Global Market, the emirate’s international financial centre, in order to bring its offset expertise to the Middle East, said the company.

Commented Tony Douglas, Etihad Aviation Group CEO: “It’s encouraging to end a difficult year with such a positive move for the sustainable future of aviation. While the year brought many challenges, sustainability has remained at the top of our agenda, and the work hasn’t stopped. Expect to see more ground-breaking initiatives in 2021.”

Added Dr Alejandro Rios-Galvan, Chairman of the Sustainable Bioenergy Research Consortium (SBRC) at Khalifa University of Science and Technology, who advises the airline on a range of sustainability issues: “This is a great start for Etihad’s zero-carbon journey using a well-respected offset standard that is fully compliant with the best sustainability practices out there. We look forward to continue supporting Etihad on their long-term sustainability strategy.”

The airline said the Greenliner offset programme would complement its ongoing work to develop and test SAFs, with a goal of making them commercially viable for widespread adoption by the industry.

Etihad recently raised $600 million in the world’s first ‘transition sukuk’, a financial instrument enabling organisations to raise funds from investors in accordance with Islamic finance principles. Transition finance supports companies to make progress towards commitments to cut carbon in line with the goals of the Paris climate agreement. The proceeds will be used by the airline for energy-efficient aircraft and research and development into SAF.

According to HSBC, which acted with Standard Chartered Bank as joint global coordinators and joint sustainability structuring agents on the deal, the sukuk also includes a commitment from the airline to pay a penalty in the form of carbon offsets if it fails to meet its short-term target to reduce the carbon intensity of its passenger fleet. Etihad has pledged to reduce its passenger fleet’s emissions intensity by 20% by 2025 from a 2017 baseline.

“Many industries, including airlines, need to undertake complex and gradual transformations to reduce their carbon emissions – and the financial sector has a responsibility to help them,” explained Ali Taufeeq, Director, Middle East Debt Capital Markets, HSBC. “The transition sukuk issuance by Etihad was a natural step in this direction and we are pleased to assist them in accelerating investment in more environmentally-friendly solutions.”

The bank said it is expecting the sustainable finance market to gain further traction over the next few years as more issuers look to source capital more sustainably. It has set up a dedicated environmental, social and governance (ESG) Solutions Unit with an ambition to provide between $750 billion and $1 trillion in sustainable financing and investment by 2030. Transition finance is any form of financial support that helps high-carbon companies start to implement long-term changes to become greener, says HSBC, and bridges the gap between traditional and sustainable financing as businesses begin the journey to net zero.

The Etihad transition sukuk follows the first aviation financing linked to the UN Sustainable Development Goals it raised in December 2019.

“By issuing a sustainability-linked sukuk, Etihad is voluntarily adding to its existing commitments under CORSIA and also committing to reduce its carbon intensity,” said Adam Boukadida, Chief Financial Officer, Etihad Aviation Group.

Meanwhile, Sir Tim Clark, President of rival Emirates, said his airline remained dedicated to sustainability and reducing its environmental impact.

“We are watching developments in sustainable aviation fuel very closely and we look forward to a time when it can be produced at scale and in a cost competitive manner. Our latest A380 delivery flight was partially powered by SAF and this is a positive step towards reducing our overall emissions,” he commented.

The SAF for the delivery flight was produced in Finland by Neste from used cooking oil. Emirates said it continued to support a number of SAF initiatives and is part of the Steering Committee of the Clean Skies for Tomorrow Coalition, established by the World Economic Forum to promote the development of SAF. Along with Etihad, it recently supported a series of webinars (Sustainable Aviation Fuels Initiative for the United Arab Emirates) on the future of SAF in the UAE hosted by Khalifa University. A third of Emirates’ crew transportation buses in Dubai currently are powered by biofuels, with one of its contractors, Al Wegdaniyah, adopting biofuel supplied by Neutral Fuels.

“After a decade advancing sustainable aviation fuel, this partnership marks a significant milestone in the work to make SAF a commercially-viable aviation fuel alternative,” said Brad Tilden, CEO of Alaska Airlines. “SAF enables us to fly cleaner and reduce our impact on the environment. However, we cannot do this alone – we must work together with other industries and business leaders like Microsoft and SkyNRG, among others who are thinking big, to achieve our goals and grow the marketplace for SAF.”

The agreement between Alaska and Microsoft relates to flights by Microsoft employees from Seattle-Tacoma to San Francisco, San Jose and Los Angeles airports – the three most popular routes they travel on Alaska.

As part of Microsoft’s partnership agreement with SkyNRG, Microsoft will become the newest member of Board Now, a coalition of organisations committed to reducing carbon emissions from flying through directly contributing to the development of new SAF production capacity.

The SAF produced by World Energy uses waste oils and is claimed to deliver a life-cycle carbon reduction of 75% compared to fossil jet fuel and sustainability is guaranteed by SkyNRG through certification from the Roundtable on Sustainable Biomaterials.

“The emergence of a SAF production system and market is a once-in-a-century opportunity to launch a new energy source for an entire industry, guided by strong sustainability standards from day one,” said Theye Veen, SkyNRG’s Managing Director. “We are very pleased to be joined by leading companies Microsoft and Alaska Airlines in this next step.”

Microsoft has committed to be carbon negative by 2030 and by 2050 remove from the environment more carbon than it has emitted since its founding.

The company’s EVP Worldwide Commercial Business, Judson Althoff, told a World Economics Forum webinar this week that Microsoft’s carbon emissions from employee air travel accounted for around 400,000 tonnes each year.

“It’s easy to do certain things in getting to net zero carbon but air travel is one of the more difficult ones, so this year we decided to make an additional commitment relative to sustainability and while right now not many of us are travelling we do expect business travel to return to significant and substantial levels,” he said. 

“To address the challenge, we have formed partnerships with airlines like KLM and Alaska to invest in SAF for our business flights. In October, we partnered with KLM to purchase an amount of SAF equivalent to all flights taken by Microsoft employees between the US and the Netherlands. We’ve now built on this momentum by announcing a partnership with Alaska to acquire SAF for the total amount of fuel we would burn on Alaska for our busiest and most common routes for business travel.

“Whilst Covid has created a bit of relief on business travel, we expect to continue to travel in the future to engage with our customers and support them around the world, and we want to return to flying responsibly. 

“Right now, SAF is more expensive and so it is harder for energy companies to justify production, so you end up with a chicken and egg conundrum between supply and demand. In order to break this cycle, companies like Microsoft need to step forward so that energy companies can see the demand signal and produce more SAF, and so the costs will come down to allow airlines like KLM and Alaska to purchase more SAF. At the end of the day, we’re all in this together.”

Microsoft, SkyNRG and Alaska are participating in a pilot project of the World Economics Forum’s ‘Clean Skies for Tomorrow’ initiative to develop a global environmental accounting standard for voluntary corporate SAF purchases. They have also pledged to hold supplier and corporate forums to share learnings and increase interest in using SAF to lower the carbon emissions from business travel.

Photo: Alaska Airlines (Chad Slattery)

“We are pleased to be able to offer our customers the opportunity to offset the carbon emissions associated with their journeys with us,” said Qatar Airways’ Group Chief Executive, Akbar Al Baker. “As an environmentally responsible airline, our modern fleet of technologically advanced aircraft, together with our fuel efficiency programme, combine to optimise aircraft performance and reduce the environmental impact of flying. Our customers can now help to further minimise their environmental footprint by opting to contribute to our carbon offset programme.”

Customers can opt in when purchasing tickets through the Qatar Airway’s website and mobile application, with booking information, including information regarding the carbon offset programme, available in multiple languages. The airline assures customers the credits they buy are from projects delivering independently verified carbon reductions as well as wider environmental and social benefits.

QAS-approved offsets are checked against a 40-point checklist that includes emissions calculations, carbon reduction project selection and information provision. Carbon calculation uses ICAO methodology supplemented with actual airline carbon data. With certain limitations, approved offsets include UN CDM CERs, Gold Standard or VCS (version 2007 onwards) VERs and approved offsets based on land use employing sustainable REDD+ project methodologies.

The Fatanpur project consists of 54 wind turbines, installed in and around villages in the central Indian state of Madhya Pradesh. They displace electricity generated from fossil fuel sources from the Indian grid.

“We are pleased to be working alongside Qatar Airways and IATA to retire high quality, independently verified carbon credits on behalf of Qatar Airways’ customers who want to take responsibility for the environmental impact of their flight,” said Robert Stevens, ClimateCare’s Director of Partnerships. “Their support for the Fatanpur project not only reduces global carbon emissions, it also provides employment opportunities; delivers improved education through providing materials and expertise to nearby schools; and supports a mobile medical unit – enabling improved healthcare to the local community.”

ClimateCare has over 20 years’ experience working with public and private sector clients to fund sustainable development projects around the world, with offices in the UK and Kenya, and is currently ranked the top B Corp in the UK. B Corp is a global movement of 3,500 companies “that are using business as a force for good”.

Welcoming Qatar Airways to the IATA Carbon Offset Program, IATA Director General Alexandre de Juniac said: “There is no alternative to aviation when it comes to long-distance travel and carbon offsetting is an immediate, direct and pragmatic means of limiting the impact of climate change.”

Airlines that have been audited and are currently QAS certified include Mango Airlines, South African Airways, SriLankan Airlines, TAP Portugal and Thai Airways.

CAE first revealed its carbon neutral ambitions late last year. “We wanted to honour our pre-pandemic commitment and up our contribution now – a testament to CAE’s environmental leadership and engagement towards future generations,” said the company’s CEO, Marc Parent.

“This is a bold achievement and we hope that CAE’s commitment in the fight against climate change will inspire other companies to take tangible actions today. We are also working with the industry towards the development of electric aircraft and undertaking other measures to reduce our overall emissions.”

Parent announced the carbon neutral decision in a live virtual Q&A discussion on the environment with employees and their children.

CAE said it would offset emissions by buying RECs in the countries where it operates and funding greenhouse gas (GHG) reduction projects such as wind energy in India and forest preservation in Canada.

According to CAE’s latest CSR report, direct (Scope 1) GHG emissions by the company amounted to 25,213 tCO2e in 2019, with Scope 1 and 2 location-based emissions totalling 87,825 tCO2e and Scope 1 and 2 market-based emissions totalling 80,550 tCO2e.

The Quebec-headquartered company had revenues of $3.3 billion in 2019 and employs 10,000 people at 160 sites and training locations in 35 countries. It trains 220,000 civil and defence crewmembers each year, including 135,000 pilots, and has over 300 airline and major business aircraft customers.

“This is a step in the right direction to ensure a green economic recovery in Quebec,” commented Pierre Fitzgibbon, Quebec Minister of Economy and Innovation. “This achievement demonstrates the real dynamism of our aerospace industry while confirming that Quebec remains a good place to make major investments in the environment and in innovation projects.”

Added Canada’s Minister of Innovation, Science and Industry, Navdeep Bains: “I am pleased to see Canadian companies demonstrating their leadership in the fight against climate change by working towards the green recovery of our aerospace industry.”

Photo: CAE’s Marc Parent discusses carbon neutrality with employees and their children