Denmark's government just announced a goal to make domestic flights fossil fuel free by 2030. In her New Year's address, Prime Minister Mette Frederiksen said she wants Danes to have the opportunity to fly fossil-free on at least one domestic route by 2025 and make all domestic flights fossil-free by 2030.
"When other countries in the world are too slow, then Denmark must take the lead and raise the bar even more," she said.
The Danish Prime Minister clearly intends to position Denmark as a hub for sustainable aviation. However, for this to come true, the announcement will need to be followed by ambitious new regulatory framework – not just domestically, but internationally.
Turning aviation green
Aviation is a fast-growing industry that currently accounts for 3% of the world's carbon emissions. As global air traffic is expected to double over the next 15 years, mainly driven by more passengers in Asia, so will aviation-related emissions if no action is taken. Yet, Aviation is considered one of the toughest sectors in which to achieve direct emissions reductions, because there are no real alternatives to jet-fuelled engines. Sure, battery-powered planes may work short-distance sometime into the future, but airplanes would have to carry 60 times as much weight if the currently available batteries are to replace aviation fuels.
The other alternative is to stop flying. France, for instance, has banned domestic flights where there are already competitive train routes in place – in practice, that means you can no longer fly from Paris to Bordeaux, Lyon or Nantes. Individual travellers have also reduced or even quit flying due to the so called 'Greta effect' and flight shame (flyg skam). However, banning short-haul and domestic flights in reality does not make a big difference, at least not towards net-zero. The big emitter is international and long-haul flights, and they are here to stay.
That leaves the aviation sector with one feasible alternative: changing fossil jet-fuels with sustainable aviation fuels (SAF). In 2019, commercial airlines' total consumption of jet fuel was around 300 million tonnes. In the same year, less than 200,000 tons of SAF were produced. With the current capacity investments in SAF, the International Civil Aviation Organisation (ICAO) estimates put production capacity in 2030 at around 11 million tonnes, which corresponds to some 3 percent of the estimated global consumption of jet fuel in 2030. The market for SAF is currently developing extremely fast with more announcements each month, but the industry will need stronger regulatory incentives to scale up SAF production faster.
Doing what it takes
In Denmark, domestic flights emit 0.15 million tons CO2 per year, which will increase to 0.17 in 2030. That is less than 0.3 percent of Denmark’s annual CO2 emissions. In this light, Danish Prime Minster Frederiksen’s announcement will not do much for the global climate emergency, let alone seriously contribute to Denmark’s own national target to reduce CO2 emissions by 70 % in 2030. Yet, the announcement is an important steppingstone towards greener aviation. For many years, the aviation sector has found itself in a catch-22, where the insufficient production of SAF has kept the price per unit high and in turn, the high prices have kept the demand low.
Because sustainable aviation fuels are – and will continue to be – more expensive than fossil jet fuel, refineries like Finland’s Neste, Italy’s Eni or the Netherlands’ SkyNRG need strong market signals from regulators to invest in its development and production. Denmark’s recent announcement goes directly into the planning and investment decision-making of companies that are working hard to develop and produce the fuels of the future.
Denmark is not alone
Despite its domestic targets for 2025 and 2030, Denmark is far from alone in this is new race. Norway and Sweden, for example, already require that a minimum amount of all aviation fuel sold in the countries must be SAF. The UK has also proposed a SAF mandate, while the current US administration is contemplating incentives to support SAF production and its uptake by airlines.
The EU Commission has already proposed a Europe-wide blend-in mandate for SAF of 2 % in 2025 and 5 % in 2030, the so-called ReFuelEU Aviation regulation. Looking at the big picture, these ambitions are very modest, given that individual airlines have already made much higher commitments. Danish-Swedish legacy carrier SAS wants to reduce its flight emission by 25 percent already in 2025. In April last year, British Airways said that by 2030, at least 10 % of its fuel will be SAF; and not to be outdone, two days later, Ryanair committed to 12.5% of its fuel being SAF by 2030. Later, in September last year, more than 50 airlines and oil companies, including BP, Airbus, American Airlines, British Airways, Cathay Pacific, Japan Airlines, Lufthansa and Shell, pledged to replace 10% of global jet fuel supply with SAF by 2030.
Challenges ahead
However, targets and pledges do not go very far without ambitious regulations that send a strong demand signal to the market. Strategies and support for the production for SAF and other new types of sustainable fuels, such as the EU’s hydrogen strategy, are much-needed levers to increase supply.
According to a recent report by McKinsey and the World Economic Forum, there are sustainable raw materials available in large enough quantities to satisfy the growing demand - from various agricultural and forestry residues, microalgae and municipal solid waste to new and promising technologies, such as Power-to-X or e-fuels, which is already being developed and scaled up across the world.
But that is just one part of the equation. If governments do not impose correspondingly ambitious regulations and requirements on the aviation sector to use sustainable fuels – not just domestically – the demand side of the equation will not be strong enough for SAF production to take off.
Therefore, going forward, Europe needs to be much more ambitious about decarbonizing aviation by setting a stable policy framework over a sufficient time horizon to provide investors with the necessary confidence to invest in the production of SAF and for airlines to pursue an efficient fuels policy. The ReFuelEU regulation is on the right track, but the proposed mandate volumes should be much more ambitious in the short and medium term. In addition, it should be possible for EU member states to implement their own SAF mandates that are higher than the proposed EU-wide mandates. Finally, Europe should work with its partners across the globe to create a truly global market for SAF, which would scale up production and bring down costs even faster.
While Denmark’s proposal for green domestic flights and the EU’s proposal for a small blend-in mandate is paving the way forward, we need to set the bar much higher, if the aviation sector is to get anywhere near its climate commitments.
