EU’s Flight Emissions Label: a step towards reporting standardisation?

How to measure aviation emissions accurately and consistently continues
to be a headache for corporate travel. Broadly speaking, travel managers want detailed,
reliable data for two reasons: to help travellers make lower-carbon choices at
point of booking; and to meet carbon footprint reporting requirements like the European
Union’s Corporate Sustainability Reporting Directive (CSRD).

The EU Flight Emissions Label (FEL), unveiled by the European Commission
in late September, is intended to answer the first of those wishes. It proposes
a “labelling scheme for flights based on a common, standardised and publicly
accessible methodology to calculate flight emissions. The label will allow
passengers to make informed choices when comparing flight options.”

But while the principle of FEL has been welcomed, concerns are emerging
over how it will be implemented, and whether it will bring standardisation
closer or could actually make it more elusive.

Overall, Angela Lille, chair of the sustainability working group of
travel buyer advocacy group BT4Europe, is “very happy” about FEL. “It is the first regulatory proposal
intended to make emissions visible,” she says. “This is the key to driving change
because the traveller can make informed decisions. I am sure it will drive
competition between airlines to lower their emissions.”

Also broadly enthusiastic
is Yvonne Moya, global procurement director, strategy, planning & CSR for Randstad
– although it is an enthusiasm tempered by the Commission deciding, for now at
least, that participation in FEL will be voluntary for airlines.

“FEL will likely
improve transparency, helping companies committed to net-zero goals manage
their Scope 3.6 [business travel] emissions more reliably,” says Moya. “However,
sourcing consistent emissions data across platforms may remain challenging
until a critical mass of airlines voluntarily adopt FEL or a mandatory
framework is introduced.” 

Lille likewise
describes voluntary disclosure as “absolutely a no go” other than for an
introductory period only. “It’s like having one currency. We need to make sure
everyone is providing the same information,” she says.

There are additional
concerns for Delphine Millot, senior vice president for advocacy and sustainability at the Global Business
Travel Association (GBTA). “It’s
important to have this information available at the point of booking but in
addition it’s important to know how this can be translated into reporting,” she
says. “Corporates want to report on their emissions and to show reductions.”

The proposal omits
crucial details buyers need for their reporting, according to Millot. “What is
going to be challenging is tracking sustainable aviation fuel usage,” she says.
“This needs to be part of the calculation. There is no word about the non-CO2
impact of aviation either. There are a lot of question marks.”

One of those
question marks applies to a separate EU initiative, CountEmissionsEU, a project designed to create a single methodology for emissions measurement across different modes
of transport. CountEmissionsEU is in the latter stages of passing through the
EU legislative process, but it is unclear to what extent its methodology would
align with that of FEL.

Also concerning Millot
is the non-universality of the proposal. Not only is FEL initially voluntary, but
it remains unclear whether it will cover flights beyond the EU. In any case,
Millot wants to see a global provider of point-of-sale emissions information, an
ambition for which “we feel there is some duplication of effort by the
industry.”

Among alternative
emissions reporting methodologies to those being developed by the EU is the open-sourced Travel
Impact Model. Developed by Google, TIM has been adopted by Travalyst, a
not-for-profit organisation whose members include the three leading global
distribution systems Amadeus, Sabre and Travelport, which continue to be the
engines for many corporate air bookings.

“All the major GDSs
are using TIM to show harmonised data,” says Millot, a firm supporter of TIM. “The
industry is making headway in working on alignment that can happen fast at
global level. Now the EU is saying ‘here is an additional label that only
applies to certain flights’. We have been telling the European Commission that
it should really watch and align with the industry.”

There are yet other
respected methodologies vying for supremacy, including one from the
International Civil Aviation Organization and another, CO2 Connect, from the
International Air Transport Association.

The plethora of
methodologies worries Tan Strehler-Weston, head of operations and policy at Thrust
Carbon, a provider of carbon reporting tools for corporate clients. “The
EU has expressed a commitment to transparency and harmonisation in emissions
reporting,” he says. “IATA and Google echo this, whle ICAO is also a
long-established open-source methodology. The reality is that these
methodologies all exist, or are being developed, in parallel. It’s like a
battle of the methodologies.

He adds: “There are advantages to that in innovation and the
best methodology winning in the long term, but it risks causing a paralysis in the
market if it corporates wait for the outcome of CountEmissionsEU or until their
TMC offers a specific new methodology.”

However, emissions measurement is not completely fragmented, and there are
efforts to coalesce. IATA and Travalyst, for example, have a memorandum of
understanding to harmonise their methodologies. There is also an international
standard, ISO 14083, which sets ground rules for how methodologies should count
carbon: distances should be calculate using great circle measurement, for
example, and emissions must include those expended in producing and
transporting kerosene, not just in burning it.

The EU has pledged to align CountEmissionsEU with ISO 14083. And Thrust
Carbon, which works with whichever methodology is selected by its clients, can adjust
them to align with the standard, meaning customers will always know their
reporting method is compliant.

ICAO, TIM, CO2 Connect and (based on what is known about them) the EU’s
initiatives have something else in common. They all belong to a new generation
of granular methodologies which measure emissions for every individual flight, incorporating
factors such as aircraft type and seat configuration. They represent a major
advance on first-generation methodologies, like DEFRA, which instead measure
average emissions per route.

DEFRA remains the most common methodology today but, says
Strehler-Weston, “it’s reaching the end of its really useful life because the
world needs to halve emissions by 2030. You need the granular data because
that’s how you choose the greenest flight option [at point of sale].” Based on
a study of its own staff travel, Sabre has estimated it could reduce emissions
by ten per cent through its travellers selecting the lowest carbon option using
TIM.

However, there are even more fundamental reasons why travel managers need
not, indeed should not, tarry over which methodology they choose. In terms of
measuring emissions for CSRD reporting, “you report your emissions for a baseline year and then you
show your trajectory towards net zero, so actually whichever methodology you
have, your trajectory is still the same,” says Strehler-Weston. He adds that
Thrust Carbon can re-run calculations retrospectively if clients opt to change
their methodology.

“Don’t wait for the
battle of the methodologies to play out,” concludes Strehler-Weston. “Just get
cracking. We should all be measuring by now and we should all be reducing.”

That is exactly the
philosophy Moya has adopted at Randstad. “Accurate, industry-wide comparisons
are difficult without a standardised approach, but we disclose which method we
use and just go with ‘this is better than nothing’ and accept that baby steps
help on our journey,” she says. “So whilst we know it is not perfection, we use
the data we source as consistently and transparently as we can but are also
willing and able to learn and correct and just be open about it.”