In our latest webinar, ‘Getting emissions management right’, Michael Charalambous from FuelPlus and Christian Mietz, Emissions Trade and Report Manager from Lufthansa, shared their thoughts on why airlines need to improve their emissions tracking and reporting and how they can do it in the most time and resource-efficient way. They also brought us up to date on the changes to major emissions schemes, such as CORSIA and the new UK ETS.
If you haven’t got time to listen to the full hour-long recording of the webinar, here are the key takeaways.
Michael made this point early in the webinar, warning against the tendency to see emissions management as a distraction from core business or as a ‘tick in the box’ exercise. To illustrate this point, he calculated that the potential financial impact of carbon offsets by 2035, could be as much as 1.4% of a carrier’s revenue. His calculation was based on a high carbon price of 33 EUR/ton CO2-eq and revenue examples taken from several group carriers in EMEA. Christian also made the point that carbon offset prices are increasing all the time, so the financial risk is only growing.
However, as with any risk, carbon offset liabilities also present an opportunity if managed well. More accurate tracking and reporting of CO2 emissions potentially translates into lower invoice costs and lower offset costs. So, getting emissions management right is not only good for the environment, it’s also good for your business.
Responding to a question from the audience around the effectiveness of carbon offsetting as a tool for carbon reduction, Michael gave his personal opinion on the matter, having worked in the area of climate change since 2008. His view was that while offsetting alone would clearly not tackle climate change, it is an essential part of our journey to net zero carbon and is action we can take now to address the emissions we are creating today. He said:
“Funding an equivalent amount of carbon emissions reductions through voluntary programmes like offsetting, is an effective way to take responsibility for our carbon footprint and it does buy us time while we develop new processes and technology to reduce it. And if you look at the original mandate of CORSIA, this is exactly what it is doing. There is, I think, a three-step mandate: short-term measures, which is where offsetting can help, and then there’s the long-term systemic changes around new aircraft technology, new operational procedures and alternative fuels.”
Michael brought us up to date on the latest with CORSIA and talked briefly about the new UK ETS, which was introduced in January this year following Britain’s exit from the EU. He discussed the fact that there is now a ‘multitude of schemas’ — EU ETS, UK ETS, CORSIA and the Swiss ETS — and that new regional schemes can’t be ruled out as more countries start to look at national carbon emissions reduction programmes.
He made the point that this presents a significant challenge to airlines because it means there are:
Watch the webinar recording
Michael summarised emissions reporting as being “all about accurate and efficient measurement so we can report, manage and reduce.” Although there are five different emissions calculation methods that airlines can use for CORSIA and the new UK ETS (only two of these are currently accepted by the EU ETS), these all rely on a figure for fuel consumption. So, the more accurate the fuel consumption figure, the more accurate your emissions calculation.
Michael made the point that if airlines collect actual fuel consumption data — not simplified averages — at a very granular level, from various sources, e.g. fuel invoices, fuel tickets, ACARS, loading sheet data and so on, they will have more accurate consumption data. They will also have a dataset that works for all schemes and all calculation methods, so they are able to choose the best calculation method for their airline. Christian confirmed that Lufthansa can do this: they are able to run their emissions dataset through the five different calculation models to work out the most favourable one for them.
Conversely, if airlines have patchy data from a limited number of sources, they are likely to have less accurate fuel consumption figures and may be limited to one or two calculation methods. This could mean higher emissions and higher offset liabilities.
Both Christian and Mike agreed that in their experience, the best calculation method to use is the one that uses fuel uplift data. Christian pointed out that fuel invoices are a continuous, reliable source of data. Michael agreed but offered a word of warning to airlines just starting out on their emissions reporting: he said that at FuelPlus, they see errors on around 50% of fuel uplift invoices, so it is critical that airlines check the invoiced amounts against other operational data, such as fuel tickets and ACARS.
Michael outlined FuelPlus’ key recommendations for building a complete and accurate emissions dataset. He explained that airlines needed:
To achieve these things, he said, automated data collection and verification was essential, which also means your fuel management processes need to be harmonised.
Christian agreed with the value of harmonising processes. He explained that at Lufthansa, all 12 of their airlines have the same fuel management software and the same back-office processes. He said this gave them a “big advantage” and “pays off” in terms of reduced resources: Lufthansa can now manage emissions trading across all 12 airlines with only one FTE role. Christian also pointed out that having one complete dataset and fuel management platform enabled them to analyse data from all 12 airlines and see where efficiencies can be gained across the entire group.
When Mike asked what tips he would give to airlines just starting out on their emissions tracking journey, Christian replied: “Collect as much operational data as you can! It always comes in useful…And integrate your processes…It will pay off one fine day in the near future.”
To support airlines on their journey towards Net Zero Carbon, we are now including our industry-leading Emissions module free of charge in all our FuelPlus Cloud packages.
FuelPlus Emissions was developed over several years with leading carriers such as Lufthansa, and is the most comprehensive emissions tracking and reporting solution out there. It’s suitable for large and small airlines, whatever their level of fuel consumption. The software significantly eases the administrative load on airlines by:
In short, FuelPlus Emissions saves airlines money because they don’t need to employ expensive consultants or internal staff to prepare the data and reports. It’s the first step towards a more sustainable airline and can help carriers prepare for any future requirements and legislation around greenhouse gas emissions.
Contact us today to arrange a demo of FuelPlus Emissions.