Average 143.7g of CO2 per-seat-per mile in January 2022 - the lowest recorded since January 2018.
10th February, 2022: IBA, the award-winning aviation advisory and analytics company, has today revealed its latest monthly Aviation Carbon Emissions Index in association with KPMG.
New IBA figures show that CO2 emissions in the commercial aviation industry averaged 143.7 grams of CO2 per-seat-per mile in January 2022. This represents a record low in aviation emissions since January 2018.
The marginal drop in these figures compared with the first half of 2021 is a result of reduced operations from next-gen aircraft in January 2022, and a slight uptick in utilisation in the largest emissions contributors, including the Boeing 737-800 and 777-300ER, and Airbus A320-200.
As the aviation recovery begins to ramp up through 2022 and beyond, IBA expects operators will continue to reactivate their dormant fleets as the requirement for capacity increases. This is likely to result in the global emissions figure creeping up slightly, before plateauing in the next 2-3 years as demand returns and stabilises.
The global share of emissions remains largely unchanged for January 2022, with the ratios of highest (aircraft) contributors remaining very similar in comparison to December 2021. However, flight volumes and overall emissions saw a significant drop, with a total reduction in flight volumes of 7% across the global passenger market from December 2021 to January 2022.
The key regions which affected the reduction in passenger traffic were Europe & CIS, and North America. Within Europe, domestic travel fell by 13.7% and international traffic fell by 19.2%, largely as a result of new restrictions imposed over the holiday period by many European nations. Similarly, North America experienced a drop of traffic volumes for international travellers of 10% but only a 6% drop in domestic traffic.
Since the start of the Covid-19 pandemic, there has been an annual trend in flight reduction around the holiday period in both December 2020 and December 2021 due to increased transmission of the virus, new variants, local and international lockdowns and travel restrictions which created a drop off flights through the start of the year. Most current-generation narrowbody aircraft saw a reduction of between -3% to -7% at the start of 2022, with newer aircraft such as the Boeing 737 MAX 200 and Airbus A321-200NX(LR) seeing a reduction of -15% and -11% respectively.
Jackson Square Aviation remains at the top of the lessor efficiency index at the start of 2022, with their portfolio performance having improved by 2 grams per-seat per-mile in January 2022 when compared to December 2021. Although no major fleet exits or changes have happened within the last month, this is largely influenced by the overall utilisation of the assets within the Jackson Square portfolio which has seen a reduction in CO2 intensity across all of the top lessors in January.
January 2022 sees the entry of two low-cost long-haul operators to IBA's airline efficiency ranking. Frenchbee has experienced a rapid increase in flight volumes in December 2021 - a trend continuing into 2022. Frenchbee operates four ultra-high-density Airbus A350-900 aircraft and one Airbus A350-1000 (configured in an W40 Y440 configuration).
This high-density layout in new-generation aircraft contributes significantly towards reducing the overall carbon intensity of Frenchbee's operations. PLAY Airlines has also entered the mix this month, operating routes between Iceland and Europe using the Airbus A321-200neo in an all-economy 192 configuration.
In this month's Carbon Index, IBA has performed an extensive analysis of aircraft leasing companies in the Asia Pacific region. This includes lessors owned by investors in the APAC region but domiciled elsewhere.
IBA's aviation carbon emissions analysis has identified SMBC Aviation Capital as the most efficient aircraft lessor in the APAC region, sitting comfortably at the top of the ranking based on intensity and overall fleet size. The lessor has a total of 440 aircraft in service, of which 171 are newer generation models. Within the new generation fleet, 87% are narrowbodies, and the remaining 13% are widebody aircraft. The average age of their fleet is 8.4 years.
SMBC's overall CO2 share will increase in the coming years due to over 200 new aircraft on order, contributing towards higher overall portfolio emissions. Despite this, IBA anticipates an overall reduction in CO2 emissions intensity across the whole portfolio as these new generation Airbus A320neo, A321neo and Boeing 737 MAX 8 aircraft are integrated into the fleet.
Lower down the ranking, on a CO2 per-seat-per-mile basis, sits SPDB Financial Leasing. A large portion of the SPDB fleet portfolio is focussed on current generation aircraft and regional jets, with regional jets making up 12.5% of the in-service fleet at SPDB.
Regional jets do not typically perform well on a per-seat basis due to lower aircraft cabin density, but do hold a much better performance based on distance (per-mile) when compared to the rest of the market. SPDB Financial Leasing's aircraft orders currently include five Comac C919 aircraft. Whilst there is no publicly available aviation data for fuel burn on the C919, IBA predicts that the aircraft will perform similarly to its Western counterparts due to the selection of the LEAP-1C engine, and will contribute towards lowering SPDB's carbon intensity.
Ian Beaumont, Chief Executive Officer at IBA, said: "Our latest Carbon Index showcases the aviation industry's efforts to reduce carbon emissions as we move into a much-needed recovery phase after the pandemic. IBA's Carbon Emissions Calculator is the most advanced and accurate aviation finance emissions monitoring tool on the market, with a unique ability to model scenarios for airline and lessor fleets, and project future emissions. We are committed to using our insights to support the industry as we strive for net zero by 2050".
Kieran O'Brien, Partner in Management Consulting and Lead Advisory Partner in the Aviation Finance and Leasing Practice at KPMG Ireland, said: "We agree that the aviation recovery begins to ramp up through 2022 and beyond; operators will continue to reactivate their dormant fleets but focus more on ESG and carbon emissions. This can be seen with the launch of Aircraft Leasing Ireland's ESG narrative "Aviation Sustainability: Our Future", which outlines the tangible steps to be taken by aircraft lessors to support aviation to achieve net-zero carbon emissions by 2050 which we were we're delighted to support".
Notes to Editors
A graphic to accompany IBA's fourth Carbon Index can be downloaded here.
IBA has over 30 years' experience in delivering independent, expert business analysis and intelligence on the aviation sector. Established in 1988, it provides a wide range of services including InsightIQ, a one-stop intelligence platform combining speed, accuracy, visual analytics and intuitive navigation.
IBA advises prominent investment funds and banks, aircraft leasing companies, operators, manufacturers and MROs. In March 2021, IBA was named 'Appraiser of the Year' by Airline Economics for the fourth time.
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