Sustainable aviation policy landscape: an overview

The Jet Zero Strategy is the UK government’s plan for achieving Net Zero aviation by 2050. The strategy includes a 5-year delivery plan to support decarbonisation through six policy measures:

Jet Zero Strategy policy measures

Several specific policy measures and aspirations are proposed in the strategy. These include (but are not limited to):

• Achieving 2040 zero emissions airports
• Achieving 2040 domestic Net Zero aviation
• Sustainable Aviation Fuels (SAF)
• Having at least five commercial scale SAF plants under construction in the UK by 2025. The Advanced Fuels Fund was launched to support this aim, competitively allocating £165 million in grant funding to support UK advanced fuels projects.
• A SAF Clearing House has been established in the UK and launched in summer 2023 to develop, test, validate and certify zero-carbon and sustainable aviation fuels.
• Achieving 10% SAF in the fuel supply by 2030.

The strategy is due to be reviewed every five years, starting in 2027. In many areas (including achieving zero emissions flight and addressing non-CO2 emissions), further policy support is likely to be required, the details of which are anticipated to emerge as the science and technological opportunities are further developed. While progress has been made, the establishment of a domestic SAF industry has been slow, and further policy support may be required to develop this at pace to meet demand, be globally competitive and progress energy security in the UK.

Click here to discover more.

The UK Emissions Trading Scheme (ETS) operates as a market-based approach and was adopted to replace EU ETS after the departure from the EU. UK ETS allows annual emissions to be capped, and companies are required to purchase and retire certificates to offset the emissions above the capped emissions. This mechanism establishes a price for carbon emissions and allows for the trading of certificates, thereby incentivising companies to reduce emissions to cut costs.

The UK ETS specifically targets hard-to-abate and energy-intensive industries such as power generation and aviation. Consequently, innovations in aerospace technologies that diminish the carbon footprint of air travel appeal to customers due to potential fuel savings and alleviating the financial strain imposed by the ETS.

Click here to discover more.

In Spring 2023 the government ran a consultation on a proposed mandate which would require jet fuel suppliers to blend SAF into aviation fuel from 2025, achieving at least 10% by 2030. The intention of this mandate is to create demand certainty for SAF, reduce greenhouse gas emissions, and provide price support for SAF supply, enabling investment. The consultation invited feedback on targets, eligible fuels, the sustainability criteria against which they will be assessed, and the mechanism through which the scheme would operate, including discharging obligations, enforcement and price support. The outcomes from this consultation are anticipated to be confirmed, setting out final policy positions in the spring of 2024 towards the proposed introduction from 2025.

Click here to discover more.

The government has published a delivery plan for the design and implementation of a revenue certainty mechanism to support the production of SAF in the UK. The mechanism would provide assurance and stability for the price of SAF, with the aim of providing greater certainty for investors, and helping to drive investment in production. This is viewed as essential by many in the industry to start to build a domestic SAF industry at scale. The details of the scheme have not yet been confirmed and a consultation on this is anticipated in Q2 2024, with a target date for delivery of the mechanism by the end of 2026.

Click here to discover more.

This strategy sets out how the UK will drive progress to deliver the ambition to produce 5GW hydrogen by 2030. It also positions hydrogen as one of a handful of new, low carbon solutions that will be critical to help meet the UK’s sixth carbon budget and Net Zero commitments. While not specific to aviation, the strategy outlines the steps that the government is taking to increase the commercial availability of hydrogen fuel. This includes support to ramp up production and development of the network and storage infrastructure, developing a market framework and supportive regulation, attracting investment and realising the full economic benefits for the UK. Economic benefits will be maximised by creating jobs, upskilling the workforce, increasing research and innovation, and taking full advantage of the export opportunities.

The strategy also recognises the potential of hydrogen in aviation’s transition to Net Zero, both as a potential fuel and as a requirement for synthetic SAF production. The UK aerospace sector is advancing hydrogen aircraft technologies at pace with target entry into service dates for regional routes as early as 2025. The production of the hydrogen fuel, and liquefaction for use in larger aircraft will generate high demand for energy and will require significant increases in clean electricity generation (The Future of Hydrogen – Analysis – IEA).

Click here to discover more.

Developed following an open consultation in 2022, the Low Carbon Fuels Strategy is set to be published in May 2024. This strategy is expected to articulate a roadmap detailing how low carbon fuels will contribute to the UK’s achievement of Net Zero emissions by 2050, optimising economic opportunities and fostering the creation of job opportunities. While the strategy’s scope is not solely focused on aviation, it may offer insights into the future role of SAF and low-carbon hydrogen within the sector.

Click here to discover more.

This deal, approved in 2020, is a set of policy initiatives by the European Commission with the overarching aim of achieving the EU’s climate targets (detailed above). It sets the strategy for Net Zero while supporting growth and social sustainability across the EU. It also sets the policies for reducing net greenhouse gas emissions, described as the Fit for 55 packages of legislation (part of which is ReFuelEU Aviation detailed below).

Click here to discover more.

The EU ETS is a key tool through which carbon emissions from hard to abate industries are capped and reduced over time. The EU ETS operates in the same manner as the UK ETS, and it is currently the world’s largest carbon market. An ETS2 is being launched in 2027 to cover fuel combustion in buildings, road transport and additional sectors such as small industry. The European Commission has also been consulting with stakeholders on the need to introduce a requirement for monitoring, reporting and verification of aviation non-CO₂ impacts, which may be introduced as part of the EU ETS later this decade. The limitations detailed above for the UK ETS also apply in the EU.

Click here to discover more.

This legislation has been proposed and agreed in principle as part of the European Green Deal. It introduces SAF blending mandate levels for fuel suppliers from 2025, increasing every five years. It also requires airlines departing from airports within the EU to refuel only with that necessary to complete the flight to avoid emissions associated with carrying enough fuel for the return flight, known as tankering. Under the legislation, EU airports must provide the infrastructure necessary to receive, store and refuel aircraft with the mandated SAF levels.

Click here to discover more.

This directive is the legal framework for the development of renewable energy across all sectors of the EU economy. It encourages cooperation between EU countries towards this goal and sets a target of at least 42.5% energy to be from renewable sources by 2030.

Click here to discover more.

This act aims to scale up the manufacturing of clean technologies in the EU. It aims to attract investment, create better market conditions and access, and simplify the regulatory framework for the manufacturing of these technologies. It hopes to accelerate the transition towards Net Zero while boosting the competitiveness of EU industry and strengthening domestic supply chains. The Act has been formally adopted by the European Parliament and the Council and will come into force once formally adopted by member states.

Click here to discover more.

The IRA came into force in 2022, designed to curb inflation by spurring investment in green technology and strengthening domestic energy security. It aims to achieve this by providing incentives such as grants and tax credits to both public and private entities that are promoting clean energy.

Through the IRA, a new Alternative Fuel and Low-Emission Aviation Technology competitive grant programme has been launched, alongside two separate tax credits for sustainable fuels. These initiatives aim to close the price-gap between low-carbon and conventional jet fuels, while also providing finance for SAF and hydrogen production scale up. The competitive grant programme also supports aerospace technologies that improve fuel efficiency, increases SAF utilisation, or reduces general aircraft emissions.

Click here to discover more.

Created under the Energy Policy Action (2005), this standard defines the minimum percentage of renewable fuel that must be present in fuel sold each year by importers and suppliers. Although SAF isn’t mandated specifically, credits can be achieved through the provision of SAF if it meets the carbon-saving requirements. The policy is designed to promote biofuels and decarbonise fuel used in transport. However, suppliers can buy-out of obligations, which has meant that the environmental objectives of the standard have largely not been met.

Click here to discover more.

Initially a state-level standard established by California, the Low Carbon Fuel standard has since been adopted by other states, including Washington and Oregon. Fuel suppliers must demonstrate the carbon intensity of transport fuels each year using lifecycle analysis, and demonstrate it meets the carbon intensity standard or acquire credits from other parties for the deficit. It is designed to decrease emissions and increase the range of low-carbon and renewable alternatives, including SAF.

Click here to discover more.

The ICAO CO₂ emissions standards was adopted to reduce the impact of aviation’s GHG emissions on the climate and it is the world’s first global technology standard for CO2 emissions. This CO₂ standard applies to all new aircraft types designs from 2020, and to aircraft type designs already in production that are modified after 2023. By 2028, any aircraft in production that does not meet the standards will not be permitted to be produced. The aim is to encourage more fuel-efficient technologies to be adopted and incorporated into aircraft design.

Click here to discover more.

Noise and air quality standards also exist for aircraft, including minimum standards that must be met, known as chapters. Over time, these chapters become more stringent helping to mitigate aviation’s environmental impact, particularly for the benefit of communities around airports.

Air quality standards are affected by aviation’s wider, non-CO2 emissions including oxides of nitrogen, carbon monoxide, particulate matter and sulphur compounds.

Click here to discover more.

In March 2024, the ATI published a first-of-its-kind Non-CO2 Technologies Roadmap and announced a funding programme in partnership with Department for Business and Trade and Innovate UK. Find out more here.

CORSIA is a global market-based measure to reduce emissions from international aviation with the aim of achieving carbon-neutral growth. Currently in its pilot phase, the scheme is voluntary until 2027 when participation will become mandatory for all but a handful of small emitting countries. From 2021-2023 participating countries annually reported and offset emissions from aviation that exceeded those emitted during the 2019 baseline year. From 2024 onwards this drops from 100% to 85% of that emitted during the 2019 baseline year. CORSIA is currently anticipated to end in 2035 but by 2032, a special review will be conducted on whether the scheme should be continued after 2035 and if so, what learnings can be applied moving forward.

CORSIA has been criticised by both airlines and NGOs for its shortcomings, as it only aims to achieve carbon-neutral growth rather than applying to all emissions from aviation. The quality of offsets has also been challenged, and ICAO has little power to enforce participation. The details of the scheme have been a compromise to gain support from nations with varying national priorities, and as a result is anticipated to have a reasonably minor impact on the global decarbonisation of aviation compared to other measures.

Click here to discover more.