European aviation industry anticipates €800bn cost to achieve net zero emissions by 2050

Industry calls for policy support and green incentives to aid the transition to sustainable aviation.

The European aviation sector faces an estimated €800 billion in additional costs to reach net-zero emissions by 2050, highlighting the considerable challenge of decarbonizing the industry. Airlines and aviation companies have committed to achieving this goal by combining new technologies, alternative fuels, carbon offsets, and improved aircraft, engines, and air traffic management.

A report commissioned by airline industry bodies, including Airlines for Europe (A4E) and airport trade body ACI Europe, indicates that achieving net-zero emissions would require "considerable additional efforts compared to business as usual," costing approximately €820 billion between 2018 and 2050. The most significant expense, estimated at €441 billion, would be the adoption of cleaner, sustainable aviation fuels derived from sources such as animal fat, cooking oil, or household waste.

While these alternative fuels can reduce total flight emissions by around 70%, they are more expensive than conventional jet fuel and are currently produced in minimal quantities. The report, prepared by research groups SEO Amsterdam Economics and the Royal Netherlands Aerospace Centre, warns that aviation companies, airlines, and airports will struggle to fund the climate transition independently due to the sector's historically low profits.

Consequently, the industry is calling for substantial support from European policymakers. This includes categorizing newer, more efficient aircraft powered by conventional jet fuel as a green investment under EU sustainable finance rules to help attract private capital. However, environmental groups argue that such classification would amount to "greenwashing" as it would label highly polluting planes as sustainable.

A4E emphasizes the need for a "stable and predictable investment environment and a consistent policy framework" to ensure that European aviation can access the necessary capital. An analysis by rating agency S&P Global this month revealed that planes currently lack a cost-effective alternative to fossil fuels. The report suggests that environmental regulations, including EU taxes on carbon emissions, could incentivize innovation, but acknowledges the high costs and risks involved, especially considering long investment lead times.

As the European aviation industry strives for sustainability, senior experts in the manufacturing sector must prepare to tackle the challenges and opportunities presented by this transition. Collaboration between the industry, policymakers, and investors will be crucial in supporting the shift toward net-zero emissions and developing innovative, eco-friendly solutions.