Singapore Airlines Highlights Climate Costs Amid Rising Emissions

According to a recent report from Singapore Airlines Ltd., the airline is grappling wiht rising costs linked to climate compliance as both passenger and freight volumes continue to increase.

The company estimates that expenses related to carbon offsetting, especially under the Carbon Offsetting and Reduction Scheme for international Aviation (CORSIA), could exceed S$200 million (approximately $156 million) by 2030. This facts was highlighted in their sustainability report released on June 25.

in the year leading up to March 31,Scope 1 emissions—those directly associated with flight operations—saw a significant uptick of 14%. This rise is attributed mainly to increased fuel consumption driven by more passengers and longer flight paths due to airspace restrictions. Singapore Airlines has set an aspiring goal of achieving net-zero emissions by 2050.

“To tackle decarbonization effectively in the near term, airlines should focus on replacing older aircraft with newer, more fuel-efficient models that produce considerably lower carbon emissions,” stated CEO Goh Choon Phong in the report.

Globally, airlines are also exploring cleaner fuel options and utilizing carbon credits as part of their strategy for managing emissions. Though, according to BloombergNEF, aviation is expected to remain a major contributor to pollution through at least 2050 due to increasing passenger demand.

Around 130 countries have participated in CORSIA’s initial voluntary phase—a UN-led initiative aimed at offsetting aviation emissions—but its future remains uncertain. the U.S.’s retreat from its climate commitments and upcoming changes in EU environmental regulations add layers of complexity for these carriers.

Airlines focusing heavily on international routes may face greater financial exposure due to CORSIA costs compared with their domestic counterparts.Analysts from bloomberg Intelligence noted earlier this month that Singapore Airlines could see an additional annual cost burden of around $13 million under certain scenarios.