Air New Zealand Scraps 2030 Sustainability Goal & Drops SBTi

Aviation accounts for around 2.5% of global CO2 emissions. However, because the emissions are released directly into upper levels of the atmosphere, the sector is estimated to be responsible for 4% of global temperature rise.

Air New Zealand – a company previously heralded as one of the most sustainably-focused airlines – has abandoned its 2030 carbon intensity reduction targets and is withdrawing from the Science Based Targets initiative (SBTi). 

The company blames difficulties in getting new planes and the availability and affordability of sustainable aircraft fuel (SAF).

In a statement, the company says these issues “are outside the airline's direct control and remain challenging.”

Greg Foran, Chief Executive Officer at Air New Zealand, says: “In recent months, and more so in the last few weeks, it has also become apparent that potential delays to our fleet renewal plan pose an additional risk to the target's achievability. 

“It is possible the airline may need to retain its existing fleet for longer than planned due to global manufacturing and supply chain issues that could potentially slow the introduction of newer, more fuel-efficient aircraft into the fleet. 

“As such and given so many levers needed to meet the target are outside our control, the decision has been made to retract the 2030 target and withdraw from the SBTi network immediately.”

Air New Zealand’s scrapped sustainability targets

In 2022, the company took on the now abandoned target to reduce its carbon intensity 29% by 2030 as part of its plan named ‘Flight NZ0’.

Carbon intensity refers to the greenhouse gas emissions per revenue tonne kilometre (RTK), a measure of passenger and cargo payload carried by the airline. 

This goal was nearly six times higher than the global aviation industry’s 5% emissions reduction target set at a 2023 United Nations meeting.

It was aligned with the SBTi’s near-term ‘well-below two degrees’ pathway, aiming to prevent catastrophic global warming in line with the Paris Agreement.

The scrapped 2030 targets had no provision for carbon offsets, requiring an absolute reduction in Air New Zealand’s carbon emissions.

Flight NZ0 did not include non CO2 equivalent effects which could also contribute to aviation induced global warming. 

The airline has removed references to its scrapped goals from the public eye. 

What does Air New Zealand’s decision mean for the industry?

Air New Zealand is the first major airline to back away from a 2030 sustainability goal.

As a geographically isolated country, New Zealand relies on aviation to transport goods and people.

The statement explains that the company has started work on a new near-term carbon emissions reduction target that could better reflect the challenges it is facing.

Air New Zealand will continue to work towards its 2050 target of net zero emissions.

Many major airlines have targets that reach above the global aviation industry’s commitment to a 5% emissions reduction by 2030, so Air New Zealand’s decision casts doubt on the possibility of other airlines accomplishing similar goals.

Michael Rurik Halaby, Head of Aviation Advisory at Mitsubishi UFJ Financial Group, says that scrapping 2030 goals is “something we are likely to see more of as deliveries remain below forecast and the ability to reach aspirational goals as 2030 gets closer.

“This would also have a knock-on effect in sustainability-linked financings.”

Air France-KLM, American Airlines, Delta and China Airlines are just a few of the major aviation companies committed to emissions reductions by 2030 approved by the SBTi. 

Anne Rigal, Chief Executive Officer of Air France, says: “Faced with the climate emergency, alongside all airlines in the Air France-KLM Group, Air France is taking responsibility and is fully committed to reducing its carbon footprint.

“The approval of our 2030 CO2 emissions reduction by the SBTi confirms the robustness of our decarbonization roadmap, and we will continue to transparently share our actions and results with our customers and the general public.”

Implementation of sustainable aviation fuel

SAF is a major pillar in most short-term aviation companies’ decarbonisation goals.

It can be used in current aircraft without any changes to reduce CO2 emissions by 80% compared to traditional jet fuel. 

This makes SAF an easier short-term sustainability solution than fuels like hydrogen that require a major infrastructure overhaul.

However even if it becomes easily available and affordable, SAF is not a net zero option so will not be enough for long term net zero goals.

Air New Zealand’s statement cites the affordability and availability of SAF as part of the reason for scrapping its 2030 goal. 

In June 2024, the company received its first delivery of 500,000 litres of SAF supplied by Exxon Mobil.

Kiri Hannifin, Chief Sustainability and Corporate Affairs Officer at Air New Zealand, explained the importance of this delivery, saying: “As the main driver of climate change, the global economy, including New Zealand, must rapidly transition away from our high reliance on fossil fuels.  

“While the volumes of SAF we are buying are very small compared to the amount of fossil jet fuel we use, they give an important signal to alternative fuel producers that we are open for business.”

The company has previously said: “We think SAF supply over time will need to include both local production and imported supply to improve supply chain security and the ability to manage peaks and troughs in demand over time.

“Although SAF production is expected to grow, so too will SAF demand, as more airlines look to SAF to decarbonise.”

In 2021, Air New Zealand and the Ministry of Business, Innovation and Employment (MBIE) signed a Memorandum of Understanding to run a closed request for proposal process to demonstrate the feasibility of operating a SAF plant at a commercial scale in New Zealand.

In 2023, the New Zealand Government and Air New Zealand invested NZ$765,000 (US$454,700) in two studies to determine the feasibility of producing SAF in the country.

Net zero by 2050

Air New Zealand is still aiming to achieve the UN’s International Civil Aviation Organisation (ICAO) agreed goal to achieve net zero CO2 emissions from international aviation by 2050.

Dame Therese Walsh, Air New Zealand Chair, says, "Air New Zealand remains committed to reaching its 2050 net zero carbon emissions target.

“Our work to transition away from fossil fuels continues, as does our advocacy for the global and domestic regulatory and policy settings that will help facilitate Air New Zealand, and the wider aviation system in New Zealand, to do its part to mitigate climate change risks."

American author Norman Vincent Peale was the first to say “Shoot for the moon. Even if you miss, you’ll land among the stars.”

This could still be the case for Air New Zealand – its original 2030 goal sat six times higher than those of the global aviation industry, so the new near-term carbon emissions reduction target it is creating could still have a big impact. 

Regardless, the scrapping of its goals sends a message throughout the industry – will other airlines follow?

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