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Why Lufthansa, BA and Air France are bigger climate villains than Ryanair

Legacy carriers play major role in climate debate and avoid the polluter pays principle almost entirely

It’s called the efficiency paradox: the notion that as goods and services become more efficient to produce, we consume more of them.

This might seem like a good thing but it’s undermining efforts to reduce emissions and curb the effects of climate change. Think of cheap food, fast fashion, €10 air fares. They’re all predicated on greater industry efficiencies.

Fuel efficiency in aircraft tends to improve by 1-2 per cent a year, but passenger demand typically goes up by 3-4 per cent a year also. The result is more emissions despite more fuel efficient aircraft.

Ryanair will shortly introduce its new fleet of Boeing 737 MAX aircraft. The reason why the airline has been so quick to stake a claim to Boeing's latest model and why the industry looks beyond the two fatal crashes associated with these aircraft is that they promise to cut fuel and maintenance costs and carry more passengers, a triple win for aviation executives and their shareholders.

The planes will allow Ryanair do what it's best at: driving down air fares. Chief executive Michael O'Leary said the Max would cut costs by a further 5 per cent. Aviation emissions are collateral damage. Ryanair is frequently cast as the villain in the climate story. It is the number one generator of CO2 emissions on flights within Europe.

Its green credentials also sit uneasily beside O’Leary’s climate sceptic views. He’s spent much of the last 20 years rubbishing the science behind it and dismissing environmentalists as “sandle-wearing loons”. He has changed tack since.

And yet,  for all the bashing Ryanair gets, it’s the long-haul, legacy carriers that play a more insidious role in the climate problem.

Emissions trading

The bulk of aviation emissions come from long-haul flights, which are not covered by the EU emissions trading system (ETS), a system that makes companies pay for the cost of emitting polluting carbons and a cornerstone of the bloc’s climate policy.

As a result, Lufthansa, British Airways and Air France don't pay for 77 per cent, 86 per cent and 83 per cent of their emissions. In contrast, Ryanair, as a short-haul carrier, must pay – via carbon credits – for 90 per cent of its emissions, a bill that amounts to hundreds of millions of euros annually.

And when these long-haul emissions are factored in, the three worst polluting airlines in Europe are Lufthansa, British Airways and Air France with 19 million, 18 million and 14 million tonnes of CO2 emissions recorded in 2019, according to data from the European campaign group Transport & Environment (T&E).

Lufthansa produces a third more emissions than Ryanair.They are also the three airlines that got the biggest Covid bailouts: (as of 2020) €6.8 billion; €2.5 billion and €7 billion respectively.

"A third of the airline bailout is going to the three most polluting carriers," Andrew Murphy, aviation director at T&E said in a report accompanying the data.

“Having spent the past 12 months pouring aid into these airlines, governments must switch course and focus on greening the sector,” he said.

This is why Ryanair is less averse to a proposed tax on aircraft fuel (kerosene) and more hostile to the ETS, which it claims distorts competition.

In 2008, the EU tried to add long-haul aviation to its ETS but industry pressure led from these airlines scuppered the move.

Lobbying Brussels

International Air Transport Association (IATA), which represents the legacy carriers and whose members include Aer Lingus, announced last month that it was committing to a net zero emissions target by 2050. A week after the announcement IATA lobbyists were in Brussels campaigning to limit the scope of EU climate measures.

They want to restrict Europe’s ReFuelEU initiative,which aims to increase the uptake of sustainable advanced fuels (SAFs) by forcing suppliers to blend more sustainable, lower carbon alternatives with the fuel sold in the European aviation market from 2025 on. The blending level would progressively increase out to 2050.

This will have cost implications but it would begin reducing aviation emissions almost immediately and is doable without an advancement in technology. IATA wants it limited just to flights within Europe, effectively excluding its members’ long-haul operations and the bulk of emissions.

A white paper produced by the World Economic Forum in 2020, and signed by Lufthansa, KLM, Boeing, Heathrow airport and Royal Dutch Shell, similarly calls for the obligation to initially apply only "to intra- European Economic Area (EEA) flights, ideally encompassing the EU and the UK".

“This will serve as a powerful incentive to boost production and secure investment in SAF,” it said.

And remember aviation is one of the few industries globally that pays no tax on fuel. The single biggest fossil fuel subsidy provided by the Irish Government in 2019 was the excise duty exemption for kerosene used for commercial aviation. The revenue forgone from this measure was €634 million.

While aviation accounts for 3 per cent of CO2 emissions in Europe, non-CO2 emissions such as airline contrails – the white lines of exhaust produced by aircraft – are now also thought to warm the planet twice as much as CO2 emissions and have only recently been factored into the industry’s impact on the environment. In terms of the polluter pays principle, aviation is on a long haul.