Climate and sustainability ‘The risks of climate change are becoming obvious’
FIGURE 27: BENEFITS AND CHALLENGES OF CLIMATE TRANSITION Business benefits
Building reputation/brand
Attracting/retaining talent Differentiation
Expansion into new markets Efficiency gains Policy incentives
Lower cost of funding Other
0 11% 10 20 30 % 40 50 60 24% 22% 20% 17% 51% 35% 57% Inadequate infrastructure
Lack of clarity/consistency in policy Lack of viable technology
Increased costs/lost revenue Inadequate data Lack of skills/expertise Shareholder preference Other
0 46%
44% 44%
26% 5% 10 20 30 %
encouraging. One is the work Google has been doing on contrail [condensation trail] detection, initially with American Airlines and more recently with Eurocontrol, using artificial intelligence in the same way as technologies for [adverse] weather detection and avoidance. That is a great illustration of the type of thing we should be doing now. It doesn’t require any new technology. We need to be looking at these types of capabilities at the network level. “The second frustration is that
I’ve seen scenarios where a strategic recognition of the importance of cracking on with things subsequently becomes deprioritised – climate-related projects where people basically said, ‘It’s important but not as important as other stuff, so we’re not doing it’.” There are major question marks
around SAF, not least because the emissions from aircraft tailpipes will be no different to those from fossil fuels. The carbon ‘savings’ depend on the feedstocks and energy use in the production process. The EU has set a mandate for 6% of aviation fuel to be SAF by 2030, and the UK is pledged to establish a SAF mandate of 10% by 2030. But SAF comprises barely 0.2% of aviation fuel at present, according to Iata, and there is no clarity on what volumes will be produced, at what price, where and the availability of feedstocks.
20 Travel Weekly Insight Report 2024 40 50 60 Source: Deloitte CFO Survey, Q3 2023 Pritchard said: “There are a number
of challenges. If we have to bring in SAF from elsewhere, there is a carbon impact of doing that. If we can establish SAF manufacturing plants in the UK, there would be transportation costs to moving huge volumes on fuel transporters. “There have been industry calls for a
government mechanism to provide some certainty around price, because you won’t get manufacturers or investors to produce SAF if there isn’t certainty around pricing. Obviously, if there is certainty around price that has an impact on airlines. Can they build that into their model? Government intervention to make a market operate for manufacturers and users seems key. “The other aspect is the feedstocks.
There could be competition for those. Other industries want the same feedstocks. In effect, we have to set up a new industry, requiring investment and infrastructure and multiple parties to come together. Ultimately, it requires government intervention to make it viable.” He noted: “When there are a lot of
BUSINESS leaders see both challenges and benefits of climate transition (Figure 27)
moving parts, it’s harder for investors to decide what to commit to. Even if the political climate is supportive, you could have a change in climate that could pull support. For example, companies were putting significant amounts of investment into HS2, then there was a change of tack. An environment where there is more
Business challenges 58% 55% 54%
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