Aviation stands to benefit from a rapid switch to sustainable fuels

Delft, Thursday, 10th June, 2021

Press release
Aviation stands to benefit from a rapid switch to sustainable fuels

The cost of climate damage due to the use of fossil fuels in aviation in Europe through to 2050 outstrips the cost of a rapid switch to sustainable fuels. Mandatory use of sustainable aviation fuels and a high CO2 price will create clarity on demand for such fuels.

This will prompt swift investments and a scaling-up of production, pushing down the price of these fuels. This holds for a transition to biofuels up to 2032, followed by a switch to e-fuels. This will require a CO2 price of € 200/t in 2025 and € 60-240/t in 2050, depending on whether the e-fuels are produced in the Middle East and imported (€ 60) or produced in the EU itself (€ 240).

The study suggests two routes to the required CO2 price:

  1. via an increase in the EU ETS price
  2. via a kerosine tax.

The high CO2 price will mean an 8-34% rise in ticket prices and a 6-25% decline in demand (depending on year, price trajectory and where the e-fuel is produced). Without these measures the CO2 emissions of European aviation will be 28% higher in 2050 than in 2019.

These are the main conclusion of the study Internalising the climate costs of European aviation. This study calculates the overall cost of this transition through to 2050, the most likely fuel mix and the CO2 price required to kick-start the transition.

The study was carried out by Max van Geuns under the supervision of Dr. Søren Bøye Olsen of Copenhagen University and Dr. Jasper Faber, Aviation team leader at CE Delft.