Lufthansa Introduces Environmental Surcharges on European Flights
Starting January 1, 2025, Lufthansa, Europe's leading airline group, will impose environmental surcharges on all flights departing from the European Union, the United Kingdom, Norway, and Switzerland. This move aims to cover the rising costs associated with regulatory environmental requirements. The surcharge will range from 1 to 72 euros per ticket, depending on the flight route and fare class. Economy class passengers on short and medium-haul routes will see an increase of 1 to 5 euros, while business class passengers will pay an additional 1.50 to 7 euros. The highest surcharge, 72 euros, will be applied to long-haul first-class flights.
The Impact of Sustainable Aviation Fuel (SAF) and Regulatory Requirements
Lufthansa's decision is driven by the need to comply with the European Union's stringent climate protection regulations. From next year, airlines in the EU are required to cover 2% of their kerosene needs with Sustainable Aviation Fuel (SAF), which is significantly more expensive than fossil kerosene. The percentage of SAF required will increase to 6% by 2030, 20% by 2035, and 70% by 2050. Currently, SAF production is minimal, meeting only 0.5% of global aviation fuel demand in 2023. This scarcity keeps SAF prices three to five times higher than traditional kerosene.
Lufthansa has also highlighted the rising costs of CO₂ emission certificates in the EU, Switzerland, and the United Kingdom. Additionally, the airline must purchase certificates for climate protection projects under the international airline system Corsia. Lufthansa CEO Carsten Spohr has expressed concerns that these requirements are neither realistic nor affordable, potentially jeopardizing European aviation's competitiveness.
Lufthansa is not alone in this endeavor; Air France-KLM introduced a similar SAF surcharge in early 2022. Currently, Lufthansa offers a voluntary 'Green Fares' option, which only 4% of customers use. This option has drawn criticism from consumer advocates and the European Commission for 'greenwashing'—making potentially misleading environmental claims.
- Lufthansa's environmental surcharge is part of a broader effort to meet climate protection goals set by the European Union. The airline has emphasized that the additional costs from regulatory requirements are too high to be borne by the company alone. The gradual increase in SAF quotas aims to reduce the aviation industry's reliance on fossil fuels, but the high cost and low availability of SAF pose significant challenges.
- To address these challenges, European airlines, including Lufthansa, have called on the EU to adopt incentive programs similar to those in the United States, which have successfully boosted SAF production. However, the environmental surcharge has sparked controversy. Consumer associations have accused airlines of 'greenwashing' and deceptive commercial practices, leading to ongoing discussions with the European Commission.
- As Lufthansa navigates these regulatory and market pressures, the airline's strategy includes passing some of the additional costs onto passengers. This approach aims to balance financial sustainability with compliance with environmental regulations.
