Researchers have charted a new course for investors aiming to navigate the turbulent and expensive skies of aviation decarbonization. A new commentary piece in the journal Science argues that a fundamental shift in investment strategy is necessary to accelerate the transition to a cleaner aviation industry. The authors propose a novel framework to guide capital toward the most promising, albeit riskiest, technologies that could lead to a significant reduction in the sector’s climate impact. This comes as the aviation industry, a rapidly growing source of greenhouse gases, grapples with the immense challenge of cutting its emissions to near-zero.
The core of the proposal is a new tool called the Aviation Sustainability Index (ASI), designed to help investors and research managers distinguish between projects that offer minor efficiency gains and those that could be truly transformative. The ASI provides a quantitative method to assess how different technologies and investments could help decouple emissions from the growth in air travel, a critical step toward achieving the industry’s ambitious climate goals. This new approach aims to create a coalition of research and development programs, investors, and airlines, all working together to deploy new technologies that can curb carbon emissions from the aviation industry.
The Investment Conundrum in Clean Aviation
The aviation industry faces a dual challenge in its quest for decarbonization: a scarcity of breakthrough clean technologies and a lack of strong incentives for investors to back such innovations. While there are large and growing pools of capital willing to take risks on clean technology, the aviation sector has struggled to attract investment in the most transformative projects. Investors and research managers have traditionally favored familiar, lower-risk ventures like next-generation jet engines or recycled-fuel pathways. These projects, while beneficial, are not enough to get the industry to near-zero emissions.
The high upfront costs associated with developing and deploying new technologies are a major deterrent for investors, especially without robust regulatory frameworks to support a favorable investment climate. The competitive and capital-intensive nature of the aviation industry leaves little room for expensive experimentation, and the majority of capital is directed toward low-risk, high-return projects, often sidelining sustainability initiatives. This has created a significant gap between the industry’s climate ambitions and the practical steps needed to drive change in real-world markets.
Introducing the Aviation Sustainability Index
To address this investment gap, the researchers propose the Aviation Sustainability Index (ASI). This quantitative tool is designed to assess the potential of various technologies and investments to reduce the aviation sector’s climate impact. By providing a clear and credible framework, the ASI aims to help investors differentiate between genuine progress and superficial “greenwashing.” The index would assign quantifiable scores to projects based on their verified emissions impact, creating a direct link between financial rewards and tangible climate benefits.
A Tool for Transformative Investments
The primary goal of the ASI is to redirect capital toward high-impact, transformative projects that are essential for meaningful decarbonization. This includes technologies that go beyond incremental efficiency improvements and have the potential to disrupt the existing industry. Professor Andreas Schäfer of the UCL Air Transportation Systems Laboratory, a co-author of the study, emphasized the need for transformation in the aviation sector. He stated that the ASI could “reward financiers for making investments that make a real difference to aviation’s climate impact.” This approach is designed to encourage and manage the disruptive investments necessary to achieve near-zero emissions.
Decoupling Emissions from Growth
A key feature of the ASI is its focus on decoupling emissions from the growth in air travel. As the demand for air travel continues to rise, simply improving the efficiency of existing technologies will not be enough to meet climate targets. The ASI provides a method to assess how different investments could contribute to a future where the aviation industry can grow without a corresponding increase in its carbon footprint. This is a critical step in enabling the industry to move towards a sustainable future.
Beyond Familiar Technologies
The commentary piece in Science emphasizes the need for the aviation industry to move beyond its reliance on familiar, lower-risk technologies. While advancements in jet engines and sustainable aviation fuels (SAFs) are important, they are not the ultimate solution for decarbonization. The authors argue that achieving near-zero emissions will require taking on bigger risks with technologies and new lines of business that will be highly disruptive to the existing industry. This includes exploring novel propulsion systems, such as electric and hydrogen-powered aircraft, and developing new business models that prioritize sustainability.
The Role of Sustainable Aviation Fuels
Sustainable aviation fuels are a key component of the industry’s decarbonization strategy, with the potential to reduce life-cycle carbon footprints by up to 80%. However, SAFs currently account for less than 0.1% of total aviation fuel consumption, and a significant increase in production is needed. The World Economic Forum’s Clean Skies for Tomorrow Coalition is working to advance the commercial scale of viable SAF production, with a goal of broad adoption by 2030. The coalition is focused on creating mechanisms for aggregating demand, co-investment vehicles, and geographically specific value-chain blueprints to support the growth of the SAF market.
A Coalition for a Cleaner Future
The authors of the Science article call for a new approach that would guide a coalition of research and development programs, investors, and airlines. This collaborative effort would be essential for deploying new technologies to curb carbon emissions from the aviation industry. By working together, these stakeholders can create a more supportive ecosystem for innovation and help to de-risk investments in breakthrough technologies. The goal is to create a framework that can guide capital to the riskiest but most transformative investments, which are crucial for the long-term sustainability of the aviation sector.
The Need for Immediate Action
The paper argues for action that begins now. By developing better tools to evaluate climate-friendly investments and by rewarding companies willing to take calculated risks on breakthrough technologies, governments, investors, and industry leaders can accelerate real progress toward decarbonization. The authors caution against setting unrealistic long-term goals that are not backed by practical, near-term actions. They stress that when it becomes clear that these ambitious goals cannot be met, it can make it harder to focus on the practical steps needed today to drive change in real-world markets.
Implications for Other Sectors
The challenges faced by the aviation industry are not unique. Many other “hard-to-abate” sectors, such as shipping and heavy industry, are also struggling to find viable pathways to decarbonization. The framework proposed in the Science article could have broader applications beyond aviation. The concept of a sustainability index that guides investment toward transformative technologies could be adapted for other industries that require significant capital investment to achieve their climate goals.
Lead author David G. Victor, a professor at UC San Diego’s School of Global Policy and Strategy, highlighted the broader challenge of industrial decarbonization. He noted that there is “too little investment in technologies that could yield the biggest climate benefits.” The proposed framework aims to address this market failure by providing a more realistic and effective way to manage investment risk and reward innovation. By creating a clear path for investors, the ASI and similar tools could help to unlock the capital needed to build a cleaner and more sustainable global economy.