Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net-zero emissions, and their real term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team share key insights and the latest news from the growing world of sustainable aviation.
The notoriously hard-to-decarbonise aviation sector is reported to be partially included in the updated edition of the EU’s Green taxonomy. The EU taxonomy is a classification system which allows participants to clarify which economic activities are environmentally sustainable investments. Comprehensive environmental measures must be met by each economic activity to achieve a ‘green label’. Within aviation, aircraft manufacturing, leasing and aircraft operators are said to be part of the green taxonomy if they meet the strict EU requirements. A leaked draft document obtained by Contexte reveals that these strict requirements include ICAO emission compliance, certification to operate on 100% sustainable aviation fuel with 10% SAF use by 2030 (increasing 2% annually thereafter), compliance with EASA and noise obligations, avoiding adding to the global fleet, and activities supporting reuse and recycling of raw materials. IBA would be cautious when marking certain areas of the industry as ‘green’, specifically SAF, as the economic activity is clearly carbon intensive and could be at risk of greenwashing aircraft. It is unclear whether the scope 2 and 3 emissions involved in the attainment of SAF are included in the EU categorisation, but we would be supportive of the updated version if this were the case. However, details of the updated version are yet to be formally published, and we look forward to learning more about the EU’s plans to encourage environmentally sustainable investments in the aviation sector.
As NASA awarded $50 million to 14 organisations for the development of composite materials for aircraft structures, it is clear that innovation is being encouraged across the US aviation market. Organisations including Lockheed Martin, Collins Aerospace, and Boeing, have received funding for the development of manufacturing processes, research into cost reduction, and an increase in production in the US. Carbon-fibre reinforced polymers (also known as composites) could play a large part in weight and fuel savings, and therefore in emissions reduction. Composites are also less corrosive and less susceptible to fatigue compared to aluminium. This reduces maintenance time and costs for airlines. Some aircraft parts such as the landing gear doors of the 737 MAX already utilise composites, but aluminium remains the most widely used in the industry. While composites are lighter than aluminium, passenger to freighter (P2F) conversions are a challenge when cutting a cargo door in the fuselage, meaning some P2F conversions might not be achieved. This could lower the fleet age. Additionally, carbon-fibre is problematic to recycle as it cannot be easily melted down and reformed. Recycling studies are underway, but there is not yet comprehensive research to indicate whether the life cycle emissions of a composite aircraft structure hold significant advantages over an aluminium aircraft structure. We are currently exploring this subject area and hope to provide valuable findings to the current limited research.