Air New Zealand has made headlines as the first major airline to abandon its climate target of reducing carbon emissions by 2030, citing challenges in finding more efficient aircraft and sustainable jet fuel.

The airline’s decision highlights broader problems within the aviation sector, which is responsible for around 2% of global carbon emissions. The industry’s efforts to reduce its environmental impact include modernising fleets and adopting Sustainable Aviation Fuels (SAFs), but these initiatives face significant obstacles.

The challenge of achieving ambitious goals

In 2022, Air New Zealand set an ambitious target to reduce its emissions by almost 29% by 2030, in stark contrast to the global aviation industry’s more modest 5% reduction target for the same period. However, recent developments have forced the airline to reconsider this target.

“Over the past few months, and particularly the past few weeks, it has also become clear that potential delays to our fleet renewal plan pose an additional risk to the achievability of the target,” said Greg Foran, CEO of Air New Zealand.

The role of sustainable aviation fuels

SAFs are a cornerstone of the aviation industry’s strategy to reduce emissions. Despite their potential, airlines have faced significant challenges in obtaining sufficient quantities of SAFs.

“The price of SAF is higher than traditional fuels and there is not enough capacity to produce it at scale,” said Ellis Taylor of aviation analytics firm Cirium.

Limited production capacity

SAF represents less than 1% of the total jet fuel market, reflecting limited production capacity. Scaling up production to meet global aviation needs poses significant challenges due to limited availability of raw materials and insufficient production facilities.

High cost

SAF is approximately four times more expensive than conventional jet fuel, creating significant economic barriers to its widespread adoption. Without significant policy incentives and subsidies, achieving economic viability for SAF remains daunting.

Constraints on raw materials

Most SAF is produced from food waste, such as cooking oil and animal fat. Future sources, including energy crops, agricultural residues and forest biomass, require further development in chemical engineering processes to become viable feedstocks.

Environmental concerns

The production of SAF has environmental issues related to land use and sustainability. There is not enough land or renewable energy potential to produce all the SAF needed for the aerospace industry. In addition, the environmental impacts of large-scale biomass production and competition with food production are important issues that need to be addressed.

Technological and legal hurdles

The technology to convert feedstock to SAF is still in development, which is a barrier to large-scale adoption. In addition, SAF requires regulatory approvals for higher blends with conventional jet fuel, adding another layer of complexity to its implementation.

Policy and investment needs

Adequate policy support, including tax incentives and subsidies, is crucial for the development and adoption of SAF. In addition, significant capital investments are required to build the necessary infrastructure for SAF production, highlighting the need for robust financial support and strategic planning.

Supply chain and production issues

The airline industry is also struggling with delays in the delivery of new aircraft. Boeing and Airbus are struggling to meet delivery schedules due to supply chain disruptions, which is affecting airlines worldwide.

“Delays in new aircraft deliveries are impacting airlines around the world, with both Boeing and Airbus delivering too few new jets in recent years, largely due to issues in the manufacturers’ wider supply chains,” Taylor added.

Boeing in particular has faced numerous challenges. The aerospace giant recently pleaded guilty to a charge of conspiracy to commit criminal fraud in connection with two fatal crashes of its 737 Max jets, resulting in the deaths of 346 passengers and crew. Boeing has also come under fire after an incident in which a door panel blew out on an Alaska Airlines Boeing jet shortly after takeoff, forcing an emergency landing.

Future commitments and objectives for the sector

Despite abandoning its 2030 emissions target, Air New Zealand remains committed to the aviation industry’s goal of achieving net zero emissions by 2050. The airline is now focused on developing a new short-term target to guide its sustainability efforts.

Air New Zealand has launched Flight NZ0™, a pledge to achieve net zero carbon emissions by 2050. Despite dropping its 2030 carbon intensity reduction target due to industry challenges, the airline remains focused on sustainability through next-generation aircraft technology, fleet modernisation and SAF. These efforts are complemented by operational efficiencies and credible carbon removal solutions to address remaining emissions. In addition, Air New Zealand offers voluntary carbon credit purchases to support emissions reduction and biodiversity projects.