Greener flights expected to increase air fares and cut passenger demand, industry warns

The cost of decarbonising flights is likely to increase air fares and put some people off flying, the UK’s aviation industry has admitted.

Measures such as making sustainable aviation fuel (Saf) widespread are expected to “inevitably reduce passenger demand”, according to a new report, although annual passenger numbers are still predicted to grow by nearly 250 million by 2050.

The Net Zero Carbon Road Map, published by Sustainable Aviation, insisted that “people will still want to fly” despite “slightly” higher costs. Sustainable Aviation is an alliance of companies including airlines, airports and manufacturers, such as British Airways, Heathrow and Airbus.

It said that Saf would be a key part of the industry’s “journey to net zero” and could make up at least three quarters of all aviation fuel for UK flights by 2050, with the majority of it produced in the UK.

Saf is produced from sustainable sources, such as agricultural waste and used cooking oil, and it reduces carbon emissions by up to 80% compared with traditional jet fuel. However, it is currently several times more expensive to produce - and these costs would have to be passed on to passengers and airlines, according to the group.

Heathrow Airport’s director of sustainability Matthew Gorman, who chairs Sustainable Aviation, said new technologies such as Saf will have a “green premium” that will have “some impact on future demand” for air travel. But he said the industry can still “grow significantly and get to net zero”, as evidence shows people are “happy to pay a bit more more to travel” in most cases.

At least five new Saf production plants are planned to be under construction in the UK by 2025, with the government investing money in their development. The government has also proposed that airlines operating in the UK must ensure Saf makes up at least 10% of their fuel by 2030.

But the group said it fears “significant” tax incentives in the US and the rest of Europe could lure investors in Saf production away, leaving the UK at risk of missing out. In a bid to combat this, it is calling on the government to introduce a mechanism that would reduce the difference in price between Saf and traditional jet fuel.

Mr Gorman said: “What the US has done is a whole series of tax incentives, which has pretty well closed the price gap with kerosene. At the moment, if you’re an investor looking to invest in a Saf plant, you’re going to go to the US rather than the UK. If we want to establish a leading position we need the right policies to get us there.”

He added: “This is the critical decade where aviation must prove it will decarbonise. Our updated Net Zero Carbon Road Map shows that we have a clear, credible path to take the carbon out of flying.

“Through a combination of Sustainable Aviation Fuel, more efficient aircraft and airspace, zero emission planes and carbon removals, we can protect the huge benefits of aviation for future generations without the carbon cost.”

On Monday (17 April), the Jet Zero Council, which is made up of industry, academic and government leaders, is due to meet at Farnborough Airport to unveil a two-year action plan for accelerating the production of Saf by investing in plants, supporting scientific research and driving down production costs.

Transport Secretary Mark Harper will deliver the keynote speech at the Sustainable Skies World Summit. He is expected to say: “This government is a determined partner to the aviation industry – helping accelerate new technology and fuels, modernise their operations and work internationally to remove barriers to progress.

“Together, we can set aviation up for success, continue harnessing its huge social and economic benefits, and ensure it remains a core part of the UK’s sustainable economic future.”