AVIATION

OVERVIEW

If any industry had a stake in reducing its use of petroleum, it would be the airline industry. At 35% of total costs, jet fuel is often an airline’s biggest expense.¹ Despite consuming 14% less fuel in 2011 than in 2000, U.S. carriers’ total fuel expenditures grew by 209%. In other words, they spent three times as much to purchase less fuel.² The global airline industry is also coming under fire for its greenhouse gas emissions. To address rising fuel costs and pollution, the industry must become more efficient and expand its use of cleaner alternatives to petroleum.

ANALYSIS

Burning large quantities of fuel to propel aircraft is incredibly expensive for airlines and, subsequently, their customers. To minimize these costs, the industry has improved its fuel efficiency by an average of 1-2% each year since the 1950s.³ But these improvements are being outpaced by the rapid growth of both passenger and freight transportation.⁴ The U.S. is already responsible for 40% of global GHG emissions from aviation,⁵ and its emissions are expected to jump another 9.7% by 2025.⁶ Roughly 80% of aviation emissions globally are from flights over 930 miles,⁷ and the average flight on a U.S. carrier is 1,121 miles.⁸ In most cases, shifting to more efficient ground or sea transport for such long trips is simply impractical.

America is the undisputed global leader in aviation, giving the country tremendous influence over the industry’s evolution, as well as an opportunity to profit from it. Roughly 75% of the commercial aircraft flying today were manufactured by Boeing.⁹ And American-owned Pratt & Whitney and GE are two of the largest jet engine manufacturers in the world,¹⁰ while GE is also the global leader in engine maintenance operations.¹¹ The aviation sector supports 10 million jobs in the U.S. and has been our top export sector for the past 10 years.¹² This influence and market share could be used to spur demand for cleaner technologies—which can and should be manufactured right here at home.

IMPLEMENTATION

Policy efforts to lower energy use and emissions should be aimed at helping industry improve the efficiency of air transportation and developing low-carbon alternative fuels.

Develop Biofuels for Aviation

Airlines can lower their overall GHG emissions by using advanced biofuels. However, the specific fuels required by jet engines will not be economical or plentiful enough without additional investment in production. The federal government could spur this investment by making these “drop-in” jet fuels a specific requirement of the Renewable Fuel Standard (RFS)—though any effort to adjust this portion of the RFS could leave the entire policy open to attack by opponents that would like to see it dismantled completely.¹³

Develop an Alternative to Europe’s Tax on Airlines

Starting in 2012 all flights that landed in the European Union (EU) were required to participate in the EU’s cap and trade program for carbon emissions.¹⁴ Due to opposition from several non-EU nations, the EU has agreed to postpone the carbon scheme for one year to allow for an international alternative to be developed. Since the EU is intent on reinstating this program if an agreement is not reached,¹⁵ Congress should pressure the International Civil Aviation Organization to finalize its global alternative, as requested by the aviation community.¹⁶ Otherwise, Congress should prepare for the creation of a domestic aviation emissions trading program.¹⁷ This would exempt U.S. carriers from having to pay into the EU program,¹⁸ and would allow Congress to direct revenues from the program back to American carriers, perhaps in the form of federal investment in innovation for aircraft efficiency or alternative fuels technologies.¹⁹

Continue the Modernization of America’s Air Traffic Control System

The Federal Aviation Administration is partnering with industry to modernize the U.S. air traffic control system. The new system, referred to as “NextGen”, will cut delays by 35-40%,²⁰ while reducing fuel use, saving carriers money, and avoiding GHG emissions.²¹ However, significant budget cuts could delay NextGen’s implementation by up to 10 years, costing the government over $200 million in lost economic benefits.²² Congress must ensure that NextGen receives the funding required for completion, and provide increased oversight to limit budget overruns and delays.²³ A low-interest federal loan program should be offered to help airlines equip planes with the systems required to utilize NextGen.²⁴