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Europe’s airlines have had to monitor their non-CO2 effects since January.
With clear targets for alternative fuel and a framework in place for monitoring the non-CO2 effects of aviation, European legislators are keen to show the world that the region is leading the way in decarbonizing the sector. However, those concrete steps toward net zero are not immune to uncertainties and external pressures.
Through a resolution adopted at the International Air Transport Association’s (IATA) annual general meeting in 2021, the global airline sector committed to achieving net-zero emissions by 2050, but the path to achieving that ambitious goal is far from simple. Even IATA Director General Willie Walsh warned earlier this year that there is likely to be a reevaluation of the target, although at IATA’s annual general meeting in Delhi in June, he insisted industry still has time to meet the target, if all parts of the value chain step up their efforts.
Meanwhile, geopolitical shifts are casting a shadow on decarbonization efforts in different parts of the world, and national governments are weighing sustainability ambitions against macroeconomic and political pressures.
- European airlines sound the alarm about SAF volumes
- National interests risk deprioritizing decarbonization
Sustainable aviation fuel (SAF) is a prime example. SAF is widely acknowledged as the most useful tool in aviation’s decarbonization toolkit for reaching its 2050 net-zero goal, but volumes are not growing fast enough.
The global airline industry held up regulatory support by the Biden administration as a model for getting the fledgling SAF production sector off the ground, with just the right amount of carrot in incentives and not too much stick in mandates.
But SAF production announcements have declined dramatically since the climate change-skeptical Trump administration took over in January. Initiatives such as the SAF Grand Challenge and the Blenders’ Tax Credit included under the 2022 Inflation Reduction Act boosted project announcements under the Biden administration, but uncertainty over funding is now the order of day—and bad news for capital-intensive projects.
While Asia’s SAF industry has huge growth potential, with considerable production underway and many new facilities planned or under construction, many government mandates or targets remain in the planning stages.
While industry players find plenty to criticize in Europe’s strategy for aviation decarbonization, 2025 is a year of transition and new beginnings. A new European Commission (EC) took office for its five-year mandate at the end of 2024, keen to set out broad policy objectives.
The transition coincided with two important pieces of sustainability legislation coming into effect. First and most high-profile, the ReFuelEU Aviation mandates delineating SAF requirements out to 2050 went live at the beginning of January, specifying an initial requirement for 2% of jet fuel to come from SAF.
In February, the new EC presented the Clean Industrial Deal aimed at making industry competitive as it decarbonizes. Although airlines praised the package’s focus on green fuels, the sector wanted more concrete action to support its competitiveness amid decarbonization and more clarity on funding for the steep ramp-up of SAF production in the region.
That, industry hopes, will come with the presentation of the Sustainable Transport Investment Plan (STIP) due later this year.
European airlines say they are committed to decarbonization. However, at a time of heavy macroeconomic pressures and rising geopolitical tensions, they are all too aware that extra decarbonization costs may put them at a disadvantage compared with international peers. Carriers want strong support from the European Union and from their national governments.
“With global competitiveness, sustainability and strategic autonomy all at stake, the EU must act now, and it must act decisively,” Airlines for Europe (A4E) said in an April position paper. “The European Commission must use the [STIP] to align Europe’s decarbonization ambitions with industry realities—unlocking investments in SAF and hydrogen, enabling SAF offtake agreements while keeping air travel accessible to all and European carriers and destinations competitive.”
A4E added the STIP “should deliver a level playing field not only for EU fuel producers but also for aircraft operators and must prevent business leakage to non-EU competitors.”
With SAF representing 56% of aviation’s decarbonization pathway, the paper continued, the “STIP must provide funding, prioritize feedstock access and support all SAF technologies equally.”
In a speech to A4E members at the association’s summit on March 27 in Brussels, the new European Commissioner for Sustainable Transport and Tourism Apostolos Tzitzikostas put forward the EC’s vision for balancing sovereignty and regional competitiveness with decarbonization goals.
“To keep aviation strong, we must reduce our reliance on fossil fuels,” Tzitzikostas said. “Because dependence makes Europe vulnerable.” He added that ReFuelEU Aviation would “not only help aviation decarbonize but also strengthen its energy independence.”
But at the same A4E event, airlines cast doubt on whether the mandates could be met and even warned, controversially, that they may need to be pushed back. While many see the 2025 mandate as feasible, the rise to 6% in 2030 is raising doubts. Some of the region’s biggest airlines said the 2030 mandate for SAF uptake may need to shift.
“We don’t have enough SAF, and the SAF we do have is very expensive,” International Airlines Group (IAG) CEO Luis Gallego said. “The only realistic solution is to move the 2030 SAF mandate date to the right.”
Lufthansa CEO Carsten Spohr said it was “science, but not rocket science, to say that this target is probably not realistic.”
Air France-KLM CEO Ben Smith agreed: “We don’t see a path toward the amount we need to reach the mandate.”
ReFuelEU contains further mandates out to 2050: 20% in 2035, 34% in 2040, 42% in 2045 and 70% in 2050, as well as smaller submandates for e-fuel.
A December report by the European Union Aviation Safety Agency (EASA) highlighted another big stumbling block for airlines when it comes to SAF uptake: the price. The EASA report put the price for conventional jet fuel at €816 ($933) per metric ton in 2023, with SAF (excluding synthetic fuel) at €2,768 per metric ton and synthetic SAF at €7,500, which is an estimate because synthetic fuels were not available in the market.
So far, no details of the STIP have been released. “We expect some measures in order to increase the SAF production in order to comply with these mandates,” Gallego said. He also called for an expansion of SAF allowances as part of the European Emissions Trading System (ETS) and their extension beyond 2030 to provide long-term certainty.
“I recognize that public intervention is necessary to drive the adoption,” Tzitzikostas said. “More effort and investment are needed to scale up e-SAF, which is a key part of our ambition.”
Europe is also a trailblazer in another area of sustainability legislation that could have a big effect on aviation’s environmental impact. Since Jan. 1, airlines have been required to monitor their non-CO2 emissions through the monitoring, reporting and verification requirement that is part of European ETS regulation. Airlines’ data on non-CO2 effects should provide the basis to define potential changes to the region’s aviation climate legislation in 2027.
Researchers, politicians and industry want to see more momentum in the non-CO2 space.
“Avoiding contrails is an unprecedented opportunity for aviation to reduce its climate impact in a much shorter time frame than for CO2 emissions,” French Parliament member Christine Arrighi said May 22 at a conference she organized with climate nongovernmental organization Transport & Environment at the French National Assembly.
Arrighi’s Haute-Garonne constituency in southwest France includes Toulouse, where Airbus is headquartered.
“European regulation is absolutely fundamental on this subject,” said Jérôme du Boucher, T&E’s head of aviation for France.
Du Boucher urged more action on contrails without delay. “We are at the precise moment where there is enough scientific certainty to move from research into practice,” he said. “That does not mean there are no more uncertainties and we can stop research. It means that we know that contrails have a climate-warming impact of the same order of magnitude as CO2 emissions and that avoiding contrails is a promising method of action with an interesting potential to reduce this impact.”
The conference participants also highlighted the importance of action at a national level. Du Boucher pointed to rapid contrail research advancements in the UK and Germany. Arrighi noted that healthy competition among European member states could help drive progress on contrail avoidance.
“There is a diplomatic issue at stake vis-a-vis our European neighbors,” du Boucher said. “We need to show that France is also in the race. It’s possible that the UK or Germany wants to be the first country avoiding contrails on a grand scale. We need to be aware of what that would mean for the reputation of our players.”
While overarching European targets set the tone for the region’s climate efforts, airlines facing varying tax regimes and SAF requirements know that national pressures risk diverting governments from the broad goals.
Renewable energy is vital to large-scale production of e-SAF, which is key to boosting SAF volumes beyond what biomass-based fuel can offer. However, in Germany, heavy dependence on energy imports pits meeting renewable energy targets against increasing energy independence at an acceptable price.
It is not just about SAF. Member states’ inability to agree on Single European Sky airspace reforms that go far enough to improve efficiency, saving fuel burn and emissions, is another stumbling block for European sustainability efforts.
While the long-awaited reforms took a step forward in 2024, the region’s airspace remains fragmented, depriving airlines in Europe of the opportunity to cut emissions in a straightforward way by flying more efficient routes.
Member states are not aligned on aviation taxation, either. After Sweden abolished an air-ticket tax at the beginning of this year, France introduced a new, higher one within a matter of weeks.
European lawmakers face a dilemma as they strive to lead the world in aviation decarbonization while juggling their own national challenges and airlines’ calls to protect their competitiveness.
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