The impact of the precipitous decline in passenger numbers due to COVID 19 is likely to be permanent and means the aviation sector could meet the 2050 CORSIA emissions reduction goal as early as 2030, according to Helane Becker, analyst at Cowen.
The first phase of the Carbon Offsetting and Reduction Scheme for International Aviation is due to come into force in 2024 and it was intended that ICAO-administered scheme would reach its target of a reduction in net aviation C02 emissions of 50% by 2050, relative to 2005 levels mainly via carbon offsetting.
But according to Becker passenger numbers are expected still to be way down at the end of 2020 with Cowen research estimating that the US market will end the year 30% smaller, while Europe could range between a 20% and 40% fall, while Asia is likely to shrink by roughly 25% this year. This means the pandemic could result in the industry hitting its emissions’ targets early.
“It’s just not feasible for the industry to return to anything like last year’s traffic and capacity levels in the current uncertain environment”, said Becker speaking on Airline Economics webinar on the ESG challenge for aircraft financing and leasing yesterday. “The result will probably be a permanent decline in carbon dioxide emissions and the likelihood of reaching the 2050 CORSIA standards as early as 2030,” she added.
Becker said that reduced flight capacity had already had a positive impact on environmental metrics, she cited data as showing a reduction in Co2 emissions around the Chinese city of Wuhan, and China more generally, of around 25%-30% on a year-on-year basis.
Likewise according to the Cowen analyst, NASA data published in April showed that on showed that nitrogen dioxide (No2) levels in the North East United States March were 30% lower than a year ago, which she said was a result to the lack of road or air traffic due to the pandemic.
“ In the US demand is 90% down, while capacity – depending on who you talk to – is down 50%-90%, and that’s had a hugely positive effect on Co2 and No2 levels,” she said. “Obviously we expect this to continue to the remainder of the year, we don’t expect a quick return to the level of flying we saw in January.”