PARIS – "We're proud to be pioneers..." It was a few days before Christmas, and Air France CEO Anne Rigail had a smile on her face, as she sat in an armchair surrounded by other noteworthy personalities, including Bertrand Piccard, co-pilot of the solar-powered plane Solar Impulse.
Rigail was relishing the impact of an announcement she'd made a few weeks earlier: In early January 2020, Air France would offset all carbon emissions from the "450 domestic flights' it runs daily, by funding projects to "plant trees, protect forests, transition to sustainable energy or protect biodiversity." A few days later, British Airways and EasyJet followed suit. The budget airline went even further, declaring that it would be the "first carbon-neutral airline company in the world."
So why are companies suddenly setting this challenge for themselves, at the cost of millions of euros, without anyone asking for it? Firstly, forests are the unrivaled star of "voluntary" carbon offsetting, a market that allows companies to fund projects that reduce or offset emissions. In return, the companies receive carbon credits. In 2018, there were twice as many projects linked to forests and land management as renewable energy. And the numbers are still growing. This is nothing surprising, given that newspapers are full of images showing Australian bushfires, smoke rising from the Amazon, and even forest fires in France. Trees have become a powerful symbol of environmental destruction.
Workers planting trees in Northern China — Photo: Xinhua/ZUMA
Eurostar has also promised to plant a tree every time one of its trains crosses the Channel. This will mean 20,000 trees planted every year in woods across Britain, France, Belgium, and the Netherlands. As for the petrol companies, they are also opting for "solutions based on nature." Shell wants to plant more than 5 million trees this year in the Netherlands and is launching similar projects in Spain, Australia, and Malaysia. The same goes for Italian energy company ENI, which is launching a project covering 8 million hectares in South Africa, Zimbabwe, Mozambique and Ghana. Total is also keen not to be left behind. In July, the French company announced its plan to invest $100 million dollars in reforestation projects.
Ordinary citizens want stronger regulations.
This trend is driven by companies' growing anxiety around the climate emergency. And they're not alone. Ordinary citizens are demanding stronger regulations that will have an impact on all industries. Cars are a telling example. New regulations mean that auto manufacturers will have to "reduce their emissions by 20% between 2019 and 2020, when it took them ten years to reduce them by 25%," according to Euler Hermes.
In addition, "companies are under pressure from their employees," says Fabrice Le Saché, CEO of Aera, which works with more than 50 carbon offsetting projects in 20 African countries. "Some companies are finding it difficult to recruit graduates from the top universities," he says, referring to a manifesto signed by almost 40,000 students who refused to work for employers in conflict with their stand on the environment.
Those companies that don't yet have the technology to quickly reduce their carbon emissions find themselves in a difficult situation. "We have technological barriers," Air France's Rigail admitted during her press conference, despite all their efforts to modernize their fleet of planes or use biofuels. These efforts don't reduce "flight shame" (flygskam), a Swedish concept that is gaining traction across Europe and tarnishing the airlines' image. So they're turning to carbon offsetting.
This race against the clock means that the carbon-offsetting industry is growing. Gérald Maradan, CEO of EcoAct, the French consultancy specializing in carbon credits used by Air France and EasyJet, confirms that his services have never been so in demand. "Since October 2019, approaches from airlines, tour operators, insurance companies and banks have been rising, whether it's about carbon footprint, reducing emissions or carbon offsetting," says the businessman, who has been working in the sector for 15 years. With 1,000 clients already, EcoAct, which has offices in Paris, New York, London and Turkey, predicts significant growth in its revenue (22 million euros in 2019) this year.
The range of companies wanting to minimize their carbon footprint includes the French Post Office, Danone and MSC Cruises, as well as Formula 1 bosses. "Banks are starting to show interest as a way of making their portfolios more eco-friendly, but also offering new financial tools," explains Hervé Lefebvre, Head of the Climate Department at the French Environment & Energy Management Agency (ADEME).
Le Saché of Aera says the carbon broker allocated 300,000 carbon credits (equivalent to avoiding 300,000 tons of carbon emissions) to companies in 2018. rising to more than 900,000 last year. His customers cover a wide range of industries and countries: Bpifrance, Lux Resorts & Hotels, investment group Investisseurs & Partenaires, as well as Dutch energy provider ENERCO and South Korean company Korea Zinc.
Some are finding it hard to survive.
In general, companies use consultants, platforms or brokers who have links with organizations on the ground, often NGOs with projects that need funding. "These brokers – there are around 20 worldwide – control the market, almost like oligarchs," says one project promoter. As carbon offsetting is voluntary and therefore unregulated, there can be issues, especially when it comes to the brokers' profit margins, which are often not transparent. Some platforms, such as ClimateSeed, are trying to fix the problem by establishing a fixed margin of 15%.
Some standards, such as the Voluntary Gold Standard or Verified Carbon Standard, have emerged, imposing very strict criteria for projects to qualify for certification. The prohibitive cost of certification, especially when it comes to reforestation projects, combined with a "race to the bottom in prices' and a "competitive tree market", means that some organizations are finding it hard to survive.
This is made even more difficult because many companies are making no effort to hide their opportunism. "The most cost-efficient way to eliminate carbon, for less than ten dollars per ton, is reforestation," admits Patrick Pouyanné, CEO of Total. This means that tree-planting projects are sprouting up across the globe, to such an extent that demand is exceeding supply. "Air France would have liked to engage in more reforestation projects but the carbon certification is especially hard to earn in this area," says Maradan. "The company had to make do with two projects in Kenya and Colombia, and one soon to begin in France. Reforestation only represented 5% of the projects, with the rest made up of projects that prevent deforestation in Cambodia, Brazil and Peru (45%) and renewable energy and energy efficiency projects."
The organization Microsol provides more efficient stoves for isolated populations in the Andes, which are affected by melting glaciers. "Microsol generates between 200,000 and 300,000 credits each year through these clean cooking methods," says its president, Arthur Laurent. And the results are clear: each of the 100,000 families would otherwise have burned more than a ton of wood every year! However, Microsol is finding it difficult to sell its credits at a fair price.
Workers planting trees in Gaoxin (Eastern China) — Photo: Xinhua/ZUMA
Some environmentalists, scientists and economists have expressed concerns about this trend, especially when they see the forest becoming a tool for greenwashing that distracts from the top priority: reducing carbon emissions across key parts of the economy. They say some of the claims are misleading. "One tree for one train journey, it's not that simple," says Sylvain Angerand, campaign coordinator at environmental organization Canopée. Offsetting carbon emissions through reforestation doesn't take into account the different timescales. As Jonathan Guyot, president of all4trees, says, "Trees planted today will take many decades to offset current emissions, whereas carbon dioxide remains in the atmosphere for around 100 years."
We need to change how we share out the value of carbon credits.
Due to climate change, forests are increasingly vulnerable to fire, insects and diseases, and we must also take into account the fact that, at very high temperatures, forests release carbon instead of storing it. Therefore, "it would be more helpful to talk about companies' contribution instead of carbon offsetting," says Guyot. There are many options for this approach. "For example, it would be more effective for companies to pay locals to preserve forests, encourage natural regeneration and develop agroforestry, or even to fund insulation projects, than to plant large numbers of trees," says Alain Karsenty, an economist at CIRAD, the French agricultural research and international cooperation organization.
It's difficult to quantify the effects of carbon offsetting, "especially the question of whether projects would have gone ahead without this private funding," says economist Christian Gollier. "We need to change how we share out the value of carbon credits, especially when it comes to international solidarity. We need to establish fair prices," says Renaud Bettin, a carbon-neutral specialist at Carbone 4.
Christophe Schmeitzky from Ernst & Young agrees. "We can't ask companies to use a high carbon price to guide their investments, and at the same time have a carbon offsetting market with low prices," he says, claiming that it offers no incentive and is even counterproductive. "Either the market regulates itself to gain credibility, or it will fall apart and the scandals will be blown out of proportion, completely discrediting it." A warning well worth heeding.
Will flying be greener? More comfortable? Less frequent? As the world eyes a post-COVID reality, we look at ways the airline industry has been changing through a pandemic that has devastated air travel.
It's hard to overstate the damage the pandemic has had on the airline industry, with global revenues dropping by 40% in 2020 and dozens of airlines around the world filing for bankruptcy. One moment last year when the gravity became particularly apparent was when Asian carriers (in countries with low COVID-19 rates) began offering "flights to nowhere" — starting and ending at the same airport as a way to earn some cash from would-be travelers who missed the in-flight experience.
More than a year later today, experts believe that air traffic won't return to normal levels until 2024.
But beyond the financial woes, the unprecedented slowdown in air travel may bring some silver linings as key aspects of the industry are bound to change once back in full spin, with some longer-term effects on aviation already emerging. Here are some major transformations to expect in the coming years:
Cleaner aviation fuel
The U.S. administration of President Joe Biden and the airline industry recently agreed to the ambitious goal of replacing all jet fuel with sustainable alternatives by 2050. Already in a decade, the U.S. aims to produce three billion gallons of sustainable fuel — about one-tenth of current total use — from waste, plants and other organic matter.
While greening the world's road transport has long been at the top of the climate agenda, aviation is not even included under the Paris Agreement. But with air travel responsible for roughly 12% of all CO2 emissions from transport, and stricter international regulation on the horizon, the industry is increasingly seeking sustainable alternatives to petroleum-based fuel.
Fees imposed on the airline industry should be funneled into a climate fund.
In Germany, state broadcaster Deutsche Welle reports that the world's first factory producing CO2-neutral kerosene recently started operations in the town of Wertle, in Lower Saxony. The plant, for which Lufthansa is set to become the pilot customer, will produce CO2-neutral kerosene through a circular production cycle incorporating sustainable and green energy sources and raw materials. Energy is supplied through wind turbines from the surrounding area, while the fuel's main ingredients are water and waste-generated CO2 coming from a nearby biogas plant.
Farther north, Norwegian Air Shuttle has recently submitted a recommendation to the government that fees imposed on the airline industry should be funneled into a climate fund aimed at developing cleaner aviation fuel, according to Norwegian news site E24. The airline also suggested that the government significantly reduce the tax burden on the industry over a longer period to allow airlines to recover from the pandemic.
High-flying ambitions for the sector
Hydrogen and electrification
Some airline manufacturers are betting on hydrogen, with research suggesting that the abundant resource has the potential to match the flight distances and payload of a current fossil-fuel aircraft. If derived from renewable resources like sun and wind power, hydrogen — with an energy-density almost three times that of gasoline or diesel — could work as a fully sustainable aviation fuel that emits only water.
One example comes out of California, where fuel-cell specialist HyPoint has entered a partnership with Pennsylvania-based Piasecki Aircraft Corporation to manufacture 650-kilowatt hydrogen fuel cell systems for aircrafts. According to HyPoint, the system — scheduled for commercial availability product by 2025 — will have four times the energy density of existing lithium-ion batteries and double the specific power of existing hydrogen fuel-cell systems.
Meanwhile, Rolls-Royce is looking to smash the speed record of electrical flights with a newly designed 23-foot-long model. Christened the Spirit of Innovation, the small plane took off for the first time earlier this month and successfully managed a 15-minute long test flight. However, the company has announced plans to fly the machine faster than 300 mph (480 km/h) before the year is out, and also to sell similar propulsion systems to companies developing electrical air taxis or small commuter planes.
New aircraft designs
Airlines are also upgrading aircraft design to become more eco-friendly. Air France just received its first upgrade of a single-aisle, medium-haul aircraft in 33 years. Fleet director Nicolas Bertrand told French daily Les Echos that the new A220 — that will replace the old A320 model — will reduce operating costs by 10%, fuel consumption and CO2 emissions by 20% and noise footprint by 34%.
International first class will be very nearly a thing of the past.
The pandemic has also ushered in a new era of consumer demand where privacy and personal space is put above luxury. The retirement of older aircraft caused by COVID-19 means that international first class — already in steady decline over the last decades — will be very nearly a thing of the past. Instead, airplane manufacturers around the world (including Delta, China Eastern, JetBlue, British Airways and Shanghai Airlines) are betting on a new generation of super-business minisuites where passengers have a privacy door. The idea, which was introduced by Qatar Airways in 2017, is to offer more personal space than in regular business class but without the lavishness of first class.
Aerial view of Rome's Fiumicino airportcommons.wikimedia.org
Rome's Fiumicino Airport has become the first in the world to earn "the COVID-19 5-Star Airport Rating" from Skytrax, an international airline and airport review and ranking site, Italian daily La Repubblica reports. Skytrax, which publishes a yearly annual ranking of the world's best airports and issues the World Airport Awards, this year created a second list to specifically call out airports with the best health and hygiene standards.
The pandemic has also accelerated the shift towards contactless traveling, with more airports harnessing the power of biometrics — such as facial recognition or fever screening — to reduce touchpoints and human contact. Similar technology can also be used to more efficiently scan physical objects, such as explosive detection. Ultimately, passengers will be able to "check-in" and go through a security screening anywhere at the airports, removing queues and bottlenecks.
Data privacy issues
However, as pointed out in Canadian publication The Lawyer's Daily, increased use of AI and biometrics also means increased privacy concerns. For example, health and hygiene measures like digital vaccine passports also mean that airports can collect data on who has been vaccinated and the type of vaccine used.
Auckland Airport, New Zealand
The billion-dollar question: Will we fly less?
At the end of the day, even with all these (mostly positive) changes that we've seen take shape over the past 18 months, the industry faces major uncertainty about whether air travel will ever return to the pre-COVID levels. Not only are people wary about being in crowded and closed airplanes, but the worth of long-distance business travel in particular is being questioned as many have seen that meetings can function remotely, via Zoom and other online apps.
Trying to forecast the future, experts point to the years following the 9/11 terrorist attacks as at least a partial blueprint for what a recovery might look like in the years ahead. Twenty years ago, as passenger enthusiasm for flying waned amid security fears following the attacks, airlines were forced to cancel flights and put planes into storage.
40% of Swedes intend to travel less
According to McKinsey, leisure trips and visits to family and friends rebounded faster than business flights, which took four years to return to pre-crisis levels in the UK. This time too, business travel is expected to lag, with the consulting firm estimating only 80% recovery of pre-pandemic levels by 2024.
But the COVID-19 crisis also came at a time when passengers were already rethinking their travel habits due to climate concerns, while worldwide lockdowns have ushered in a new era of remote working. In Sweden, a survey by the country's largest research company shows that 40% of the population intend to travel less even after the pandemic ends. Similarly in the UK, nearly 60% of adults said during the spring they intended to fly less after being vaccinated against COVID-19 — with climate change cited as a top reason for people wanting to reduce their number of flights, according to research by the University of Bristol.
At the same time, major companies are increasingly forced to face the music of the environmental movement, with several corporations rolling out climate targets over the last few years. Today, five of the 10 biggest buyers of corporate air travel in the US are technology companies: Amazon, IBM, Google, Apple and Microsoft, according to Taipei Times, all of which have set individual targets for environmental stewardship. As such, the era of flying across the Atlantic for a two-hour executive meeting is likely in its dying days.
- How Persian Gulf Airlines Surged To Top Class Of Travel Industry ... ›
- How Countries Are Coping With A Tanking Tourism Industry ... ›
- COVID Recovery? End-Of-Summer Checkup On Travel Industry ... ›