Estimating Cost Savings for Aviation Fuel and CO2 Emission Reductions Strategies

Abstract

Achieving reductions in aviation greenhouse gas emissions while growing the aviation industry is both a national and a global challenge. This paper discusses and summarizes the suggestions for reducing emissions, and both the short-term and long-term emissions goals for three aviation industry groups, the European Union and United States aviation regulatory agencies, and the United Nations specialized agency for civil aviation. Reducing fuel consumption affects an air carrier’s bottom line by reducing fuel costs and carbon emissions. Investments may be required in aircraft or procedural changes to reduce demand for fuel by reducing consumption while still providing the same level of air service. Investing in reducing fuel consumption is not only important to comply with any emission trading scheme, but will also become a major factor for survival in the present competitive air transportation market. A general method to estimate cost savings is developed that presents a comparison method independent of the specific type of fuel reduction method. This method uses the percentage of fuel reduced to analyze cost savings using a range of fuel prices and non-discounted payback period. Analysts may use this method for calculating the savings specific methods of reducing fuel consumption.