As airports adapt to new environmental requirements, technology steps up to help them keep track of their carbon footprint.
Swedavia and Veovo have partnered to introduce environmental emissions incentives for airlines. The airport operator’s flexible airport charges scheme essentially rewards airlines for operating out of Swedavia airports Stockholm Arlanda and Gothenburg Landvetter with more fuel-efficient aircraft. In all, Swedavia operates 10 Swedish airports and is a leader in adopting environmental innovations.
The recently introduced CO2 and NOx Emission Charges follow a Swedish government requirement that airport charges be differentiated for environmental purposes. Airlines are charged more when operating aircraft with higher emissions and less when operating cleaner aircraft. The overall effect on airport revenue for Swedavia is neutral.
Lena Wennberg, chief sustainable development officer at Swedavia, says:” Swedavia wants the travel of the future to be sustainable. For many years, we have actively worked towards a transition to more sustainable travel via our airports. By the end of 2020, Swedavia became completely fossil-free in our airport operations. Fossil-free renewable HVO-diesel is now being fuelled at our airports. Within the Swedish government’s initiative Fossil-free Sweden, which we work within, there are also goals for domestic flights to be completely fossil-free by 2030. For international traffic, all planes taking off from Swedavia’s airports must be fossil-free by 2045″.
Veovo’s Revenue Management software will automatically calculate airlines’ environmental impact at the airport, using industry emission data sets and Swedavia’s innovative environmental charging approach. Swedavia shares the calculations with airlines on their invoices.
” The industry’s drive towards increased sustainability and carbon neutrality requires a toolkit of innovative technologies and approaches, including charging that rewards cleaner aircraft,” said James Williamson, CEO of Veovo. “We are pleased that our aeronautical billing engine with complete charge flexibility will support Swedavia in their initiative.”
Swedavia’s climate transition work was recently honoured by the Airports Council International (ACI), awarding the operator the Eco-Innovation Airport of the Year in 2021.
Airports embrace sustainability
Readers may be interested in the perspective of Jennifer Desharnais, Manager Sustainability at ACI World, who advises the aviation industry not to consider sustainability as a mere “box-ticking exercise.”
In her article, A Sustainability Strategy: Why it Matters – published on ACI Insights, Desharnais states:
“Airports are not new to the practice of operating as sustainably as possible. Several show true leadership, and clearly have a solid sustainability strategy that cascades down and engages all employees. These airports typically create innovative partnerships, collaborate with both in-sector and out-of-sector stakeholders, invest in technologies and training, embrace change, understand the needs of the passengers and communities they serve, and measure their impact on society and the environment. Overall, the airport sector is one that recognises the intricate interdependencies of all three pillars of sustainability, and the associated risks and opportunities.”
But there will be a lot of measures to account for, and technology companies can help make progress toward a carbon-neutral future more transparent.
The future of flexible airport charges
ACI World has suggested that flexible airport charges might also result in the more efficient use of airport infrastructure. ACI World published a policy brief on this topic at the end of last year—Airport Charges: Challenging the Conventional Wisdom—with the assistance of InterVISTAS Consulting Inc. and the support of Oman Airports Management Company, ACI Africa, ACI Latin America-Caribbean, and ACI North America.
The brief suggests:
- Policies on airport charges should ensure that they serve the travelling public’s and local communities’ best interests.
- Strictly cost-based airport charges do not ensure that infrastructure is used more efficiently to benefit the travelling public.
- The primary focus of charges should be on market needs and signals for the efficient use of infrastructure.
- The best way forward in the changing competitive landscape is through commercial agreements between airports and airlines.
- Light-handed oversight formats are preferable in exceptional situations where economic regulation of charges is deemed necessary.
More flexible policy
The environmental incentive scheme introduced by Swedavia appears to be a better solution to keep Europe’s airports on target than the Fit for 55 proposals put forth by the European Commission.
Fit for 55 refers to achieving a 55% reduction in carbon emissions by 2030 relative to 1990 levels and encompasses the goal to meet net-zero targets by 2050. The European Commission has proposed mandating the use of sustainable aviation fuels (in its ReFuelEU Directive), requiring the supply of electricity to stationary aircraft (in the Alternative Fuels Infrastructure Regulation, AFIR), and putting an effective price on CO2 emissions and jet fuel (through the EU Emission Trading System, ETS, implementation of CORSIA, and the European Taxation Directive, ETD).
While well-intended and in some ways aligned with aviation’s environmental commitment, ACI Europe has pointed out that Fit for 55 could have an unintended negative impact on European airports, airlines and passengers alike.
An analysis conducted by Oxera on behalf of ACI Europe finds:
- The AFIR will require airports to upgrade or change their infrastructure to ensure electricity supply is available at aircraft gates and stands.
- The other proposals will increase airlines’ costs— e.g. by introducing a kerosene tax. The extent to which airlines mitigate, absorb or pass through these cost increases to passengers and how passengers respond to any fare changes will determine the effect of these proposals on carbon emissions and demand and revenue at airports.
- The Fit for 55 proposals will reduce demand at European airports.
- Fares on direct flights could increase by 11% in 2030 and 13% in 2050, leading to a reduction in demand of 5% in 2030 and 6% in 2050.
However, the Oxera report points out that while these policies will dampen demand, the overall trend is for future passenger demand to exceed 2019 levels. These policies will not curb flying. Aircraft will remain a preferred form of transport for many. Instead, they will only lessen the number of flights operating in Europe.
Climate change is a global issue, and the solutions should also be global.
Oxera finds Fit for 55 might encourage more airlines to program connecting flights that avoid European airports and switch routes to connect through other airports instead. Even flights originating in Europe destined for long-haul routes may choose to connect through airports elsewhere. After building the infrastructure to attract connecting flights, Europe’s airports need to remain viable.
What is more, this policy shift would not effectively accomplish its mission.
- The proposals reduce carbon emissions per passenger by 54% in 2050 on flights within the EU, but only by 20% on flights that connect EU and non-EU airports.
ACI EUROPE proposes the following policies:
- Further incentivise and provide financial support to increase uptake of SAF (sustainable aviation fuels).
- Allocation of revenues from taxation and ETS for aviation decarbonisation
- Exempt small airports from supplying electricity for stationary aircraft
- Engagement with the EU’s main trading partners and other third countries to accelerate international decarbonisation goals and actions
Olivier Jankovec, Director General of ACI EUROPE, said: “The achievement of our climate goals is too important to proceed with anything other than the fullest body of knowledge possible. And the social and economic cohesion that comes with robust air connectivity is too valuable to our continent and communities to put at risk. Oxera’s report shows that the ‘Fit for 55’ package, whilst unquestionably valuable in its aspirations and directions, invites unwelcome and unanticipated consequences through a lack of a comprehensive and cumulative impact assessment. As we all strive to decarbonise our sector, let us go forward with our eyes wide open. The process will be costly and lengthy, and ours is by its very nature a global industry. The measures we propose today will help create a firm foundation for us to move forward whilst protecting Europe and its citizens from distortion and exclusion. We urge the European Institutions to incorporate these in their next steps”.
While the objective is to ensure a sustainable future for humanity, there are more gains to be made from flexibility.
Fresh green tech opportunities
In her article, Desharnais also raises awareness about the complexity of reporting, highlighting opportunities for the tech sector to offer solutions that will help keep aviation on track towards net-zero 2050.
“The spotlight on sustainability is resulting in a multitude of ESG ratings and rankings, sustainability reporting frameworks and guidelines, and target setting guidelines, popping up all over the sustainability landscape. Often dubbed the “ESG alphabet soup”, the topic continues to gain greater attention every day, demonstrating the pressing need for standardisation. For airports and many other businesses, it can easily become confusing. ACI’s ESG Management Best Practice aims to help airports better understand the differences between ESG and sustainability reporting, the steps they can take to start or improve reporting, and the reasons why investors are interested,” she writes.
ACI World’s Sustainability Strategy for Airports Worldwide, published late last year, is free to download and a recommended deep dive into the process.
The environmental commitments made by the aviation industry—to achieve net-zero targets by 2050—requires technological innovation not only in aircraft and fuel systems but in how we measure and keep track of operations. Governments, investors, and the travelling public will demand transparency along the path to net-zero. Ensuring accurate reporting will be essential.
After all, sustainability is nothing without accountability.
