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Lufthansa has become the first airline group to pass on the cost of Europe’s new emissions rules to passengers, announcing a surcharge of between €1 and €72 per ticket from next year.
The Frankfurt-based group, which operates Eurowings, Swiss and Austrian Airlines as well as Germany’s flag carrier, said on Tuesday it was introducing a charge for departures from European countries to cover the “ever-increasing additional costs” of new green fuel requirements. .
Lufthansa credited the introduction of the surcharge to an EU rule for sustainable aviation fuel (SAF) to contribute at least 2 percent of airlines’ fuel consumption, which will come into force at the beginning of 2025. It also pointed to the European Emissions Trading System and the international Corsia system, under which airlines buy carbon credits to offset any growth as factors behind the fee.
SAF is currently at least twice the cost per ton of conventional hydrocarbon jet fuel.
The group surcharge will apply to departures from the 27 member countries of the European Union, the United Kingdom, Switzerland and Norway, all of which participate in the SAF rules and have emissions trading schemes.
Andrew Charlton of the consultancy Aviation Advocacy said Lufthansa Group’s move, the first by a European airline, was an “extremely aggressive” response to the introduction of the rules by the European Commission.
While some airlines introduced surcharges after joining the emissions trading system in 2012, Lufthansa’s move was the first European airline to respond to the latest measures, Charlton said.
The SAF quota in the European Union is to increase gradually over the coming decades and reach up to 70% by 2050. This sector is one of the most difficult to decarbonize due to the challenges of finding non-fossil fuels as dense as highly concentrated kerosene. Lufthansa expects the gradually increasing SAF requirement to cost billions of euros in the coming years.
“The airline group will not be able to bear the gradually increasing additional costs arising from regulatory requirements in the coming years,” the company said.
The new surcharge would cover part of the costs arising from regulatory requirements for 2025, the group said.
Some environmental activists have warned that airlines must be transparent about what they charge for.
Jo Dardenne, director of aviation at Transport & Environment, said: “The announced surcharge does not provide sufficient clarity on the volumes and costs purchased by the SAF or the cost sharing between the airline and its passengers.
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There are significant concerns about the ability of SAF providers to produce enough fuel to meet global demands.
Manufacturers produced 500,000 tonnes of SAF globally last year. Lufthansa consumed 8.45 million tons of fuel during the year.
It is unclear whether other European airline groups will introduce similar explicit surcharges or whether they will bear the costs of the new environmental requirements themselves.
In an interview with the Financial Times this week, Lauren Riley, United Airlines’ chief sustainability officer, called on pipeline operators to start carrying SAF as part of efforts to reduce fuel costs.