Deloitte has warned that the European Union’s current sustainable aviation fuel policies could unintentionally weaken the competitiveness of European airlines and slow progress toward decarbonisation.
A new study by Deloitte for airlines for Europe, published recently on Green Air News, raised concerns that the ReFuelEU mandate, which requires increasing the use of sustainable aviation fuel, may drive passengers toward non-EU carriers and destinations that are not bound by the same environmental regulations.
The report warned that this could result in carbon and business leakage, undermining both climate goals and market fairness.
Deloitte estimated that ReFuelEU could increase cost disparities by up to 15 per cent on key EU–Asia routes by 2030.
As a solution, the study proposes a SAF Book and Claim Accounting Mechanism, which it said could help maintain a level playing field without raising overall prices for consumers.
The report identified the main types of leakage caused by the current policy framework including passengers choosing non-EU hubs like Istanbul or Dubai over EU hubs such as Paris or Frankfurt to avoid SAF costs; travelers opting for indirect routes outside the EU, since ReFuelEU applies only to the first flight segment departing from the EU; and EU travelers selecting non-EU holiday spots to avoid EU ETS costs, and non-EU residents bypassing EU destinations altogether.
While the EU already has a Carbon Border Adjustment Mechanism to price the carbon content of imports like cement and steel from countries with weaker climate rules, discussions are underway to possibly extend CBAM to aviation.
However, a 2024 analysis by Ishka notes this is complicated by the upcoming 2026 review of ICAO’s CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation), which will assess whether the scheme aligns with the Paris Agreement targets.
The Deloitte report argued that applying CBAM to aviation is “neither legally nor practically feasible,” and called for a tailored solution for international air travel emissions.
The proposed SAF-BAM system, it said, should be established through EU legislation and enforced by national authorities.
It was added that the mechanism would rely on integrating passenger data with flight operations data to calculate SAF use per passenger and per flight segment.
“Revenue generated from the sale of SAF-BAM certificates could be dedicated to further support the aviation sector, including green transition projects,” the report added.
