To axe first-class or low-cost flying, that is the climate question
Making flights more expensive will hurt those for whom €20 in new taxes, say, is the difference between flying and staying home
Michael O’Leary of Ryanair Holdings is an unlikely spokesperson for how aviation can avoid killing the planet. The budget travel evangelist has delighted in disparaging “eco-warriors” and casting doubt on climate science. But as chair of the European trade association Airlines for Europe (A4E), he is now front and centre of the effort to persuade governments not to impose new climate taxes on the industry. It’s not going well.
This week, the European Commission’s president Ursula von der Leyen unveiled a plan to make the continent carbon-neutral by 2050. Her “green deal” is still thin on detail, but it’s already prompted plenty of criticism — from the green groups who say it doesn’t go far enough to the big polluters who fear it will harm their competitiveness, such as coal-dependent Poland and the airlines.
One aim of the green deal is to make the price of transport “reflect the impact it has on the environment”. Accordingly, Europe will review aviation’s tax exemptions — kerosene isn’t taxed — and consider cutting the free allowances allocated to airlines under Europe’s emissions trading system.
The airlines think they’re being unfairly maligned. They contribute about 2% of global emissions, a fraction of what cars and trucks produce. But unlike road transport, the aviation industry doesn’t have a convincing plan to decarbonise. Europe’s airlines are spending €170bn on new, fuel-efficient aircraft, but these will still spew out carbon. Synthetic fuels are expensive and battery limitations mean emission-free commercial flights are years away.
Aviation is typical of the trade-offs we’ll have to make to get to net-zero emissions. So far we’ve only done the easy stuff that doesn’t force people to give up much or pay more for cheap products and services. The airlines are lobbying for better air traffic management in Europe’s crowded skies, which would cut the amount of fuel used. But there’s only a certain amount of carbon we can keep emitting before things go from bad to catastrophic.
Even flying fanatics are no longer convinced that its growth should be unconstrained ... When the environmental impact of a business isn’t priced in, there can be such a thing as too much freedom
The question of who will have to cut back most on their polluting raises issues around economic growth and fairness: the top 10% of most frequent fliers took more than half of all flights from England in 2018, while almost half the population don’t fly at all. Airlines don’t even agree among themselves about whether to punish the business lounge elite or the weekend city breakers.
The International Air Transport Association (IATA) boasted this week that more than 4.5-billion passengers will have taken a flight in 2019 as tickets become ever cheaper.
The average return fare, adjusted for inflation and taxes, is almost two-thirds lower than it was 20 years ago. “Flying is freedom,” IATA’s Alexandre de Juniac intoned.
But even flying fanatics are no longer convinced that its growth should be unconstrained. Over-tourism in the Mediterranean has brought this to wider attention. When the environmental impact of a business isn’t priced in, there can be such a thing as too much freedom.
Ryanair makes the reasonable point that aviation taxes are a levy on the poor. Making flights more expensive will hurt those for whom €20 in new taxes, say, is the difference between flying and staying home. It’s fine to encourage people to take a train, but rail fares are often higher, and decent services are concentrated in richer European countries. A similar debate is raging in the car industry, where the cost of electric batteries could make small cars — often bought by the young and elderly — uneconomical.
Hence the budget airline Wizz Air Holdings struck a nerve with a video that calls for the business class cabins of its big legacy rivals to be banned. “We think you’re doing great … harm to our planet … Are all those empty seats worth the damage they cause?” the narrator asks.
Wizz is, of course, talking its own book; it doesn’t offer business-class. But in a carbon-constrained world, abolishing business- and first-class isn’t so outlandish. Because of their ability to sell out flights and cram passengers on-board, Wizz and Ryanair are Europe’s two most efficient airlines when measured on carbon dioxide per passenger kilometre traveled.
Naturally, the older carriers don’t see it that way. Ryanair’s promotion of tickets that cost less than €10 is “economically, ecologically and politically irresponsible”, according to Lufthansa CEO Carsten Spohr. KLM of the Netherlands is even encouraging consumers not to fly if they don’t have to.
The airlines still hope to find a way out of the impasse. EasyJet will offset the carbon produced by all its flights, for example, by paying to plant trees. That will cost the airline just £25m a year, equivalent to about 26p per passenger or £3 per tonne of carbon produced. But such measures haven’t always delivered the promised benefits and have been likened to the old Catholic practice of selling indulgences.
While the price of European carbon permits has risen above €20 a tonne, that’s probably too low to really affect ticket prices or encourage the use of expensive synthetic fuels. In 2019, Ryanair paid €115m for emission allowances, or less than €1 per passenger.
The green deal is billed as a “growth strategy” but nobody should pretend this won’t involve hard decisions. The noisy complaints are an industry realising its licence to expand and pollute is being revoked.
• Bryant is a Bloomberg Opinion columnist covering industrial companies.