By Joanna Plucinska, Julia Payne and Tim Hepher
BRUSSELS (Reuters) -The EU’s requirement for 6% of the jet fuel used by its airlines to be sustainable by 2030 is impossible to meet because of the cost and scarcity of green fuels, airline CEOs warned on Thursday, in a statement the European Commission shrugged off.
The announcement, decided on Wednesday evening by a group of CEOs, was the most blunt criticism of the EU’s regulatory approach to sustainability to date and caught EU officials and lobbyists off guard.
The chief executives of Ryanair, IAG, Lufthansa and Air France-KLM shifted away from a pro-green narrative they have touted in recent years.
Instead, they increased criticism of the EU requirements for sustainable aviation fuel, adding that they created added regulatory burdens that risked European aviation falling behind global competitors.
“We urgently need an EU aviation strategy in order to have SAF at competitive prices … unless action is taken now, the only realistic solution is to move the 2030 SAF mandate to the right,” said Luis Gallego, the CEO of British Airways-owner IAG.
They were supported by the head of aviation trade body IATA, who made a surprise appearance at the event in Brussels.
“We can’t just stand back and pretend that these targets are meaningful and can be achieved. They were never going to be capable of being achieved,” Willie Walsh, director general of the International Air Transport Association, told Reuters.
However, the executives stopped short of saying an industry target of net zero emissions by 2050 would not be reachable.
SAF costs three to five times more than traditional jet fuel and makes up only 0.3% of global jet fuel supply. European airlines are this year expected to use 2% of SAF in their jet fuel mix, with the mandate rising to 6% in 2030.
A Boston Consulting Group report published on Thursday found that airlines and airports are investing only 1% to 3% of revenue or budget allocation to SAF.
Still, the executives said they would continue pressing the European Commission to provide more financial support for building SAF plants and that without more supply, the targets would have to be moved back.
“We consider the current SAF targets to be realistic and feasible,” the European Commission said in a statement responding to the executives’ claims.
European Commissioner for Transport Apostolos Tzitzikostas said at the event that he would work with the airline CEOs but did not directly address the CEOs request to consider moving back the mandate targets.
The head of industry group Airlines for Europe said regulatory costs had tripled between 2014 and 2024, with the CEOs adding that EU regulators need to be more aware of the global narrative around sustainability, given U.S. President Donald Trump’s pro-fossil fuel stance.
Ryanair CEO Michael O’Leary said the oil majors – the biggest likely producers – were already cutting back their SAF programmes.
A source said the executives were not all in agreement on the decision to go public so firmly with their call to push the mandate targets back, with A4E releasing a clarifying statement at the end of the conference saying it was fully committed to decarbonising aviation.
COMPETITIVENESS
The airlines said the European Union’s sustainability rules created an unfair cost burden on them, giving an advantage to international carriers that don’t have to meet sustainability mandates and can fly longer routes.
“Our market shares are going down not only to government-owned carriers in the East but also private competitors and some partners in the U.S.. European aviation is falling behind,” Lufthansa CEO Carsten Spohr said.
As with the car sector, aviation could benefit from an easing of sustainability requirements, executives said.
“We all know we started with a Green Deal that now has been moved into a clean deal. And I think we also need a lean deal,” said Spohr.
The European Commission proposed last month in its “Simplification Omnibus” to cut the burden of climate-related reporting but the focus was to relieve the pressure on small and medium companies.
(Editing by Mark Potter and David Evans)
