Aviation is one of the hardest things to decarbonize. Some think that planes can be electrified, and we salute the effort, but electric planes are slow and unlikely to replace conventional planes any time soon.
Some think the solution is curbing how much we travel by air. “People should drive, take the train, or just stay home.” Indeed. There is more room for teleconferencing today, which encourages less business travel. It’s also true that people could stand to vacation closer to home. But the Wright brothers got us hooked, we are a flying species.
Sustainable Aviation Fuel (SAF) is a bonafide near-term solution. SAF can reduce aviation emissions by up to 80%. It can even be made from biomass, and can be made from CO2 itself. If the latter method scales, we can imagine a future of carbon neutral aviation.
But this future needs to be paid for. So far, the task has been left to government programs and corporate activity. Money is moving, but there is still an ocean of money waiting to be tapped.
Everyday people have a large role to play in the decarbonization of aviation. As the main buyers of air fare, the public not only has a role, it has an obligation to make sustainable aviation a reality.
Thankfully, with the magic of design, this reality isn’t too far away. Let’s explore ways—some bad, some good—to nudge everyday travelers to decarbonize aviation.
Displaying Emissions (Current Program)
As planes fly through the air at 500mph, they burn a lot of fuel and emit a lot of greenhouse gas. But how much is “a lot?”
Our ability to estimate flight emissions is well developed. Google Flights pioneered the display of emissions for each flight on its booking platform. The drawback until very recently has been a lack of relevance. Sure, flyers could see that one flight emitted more than another, but the measures were in unfamiliar terms.
For example, an economy class ticket for a direct flight from LAX to JFK will emit about 300 kilograms of CO2e. Once again, we return to the question, “is that a lot?”
In weight terms, 300 kg is comparable to: a grand piano, a fully-grown lion, and a large refrigerator. That seems like a lot, but how do the emissions stack up?
In a very recent update, Google Flights approached the issue. By using the example of the CO2e absorption of trees, flyers can better understand emissions differences between fare options. Now we can see that one flight from LAX to JFK avoids as much CO2e as 2,374 trees absorb in a day. That is a lot.
But, it’s unclear how this information is changing behavior. Direct flights have lower emissions. Flyers already prefer direct flights for reasons of convenience. Thus, the display of emissions may not be doing much to change behavior. It may simply help flyers feel better about a choice they were likely to make anyway.
SAF Certificates (Current Program)
As said earlier, most of the money going into sustainable aviation fuel is at the corporate level. Large checks are changing hands, press releases are being published, some SAF is being made…But, few airlines are inviting everyday passengers to the conversation. An exception is Air France & KLM.
The airlines allow flyers to contribute to SAF when booking flights. The choice doesn’t impact the flight they are booking, but it’s a good faith gesture that allows everyday flyers to endorse SAF. This is an amazing first step. Major kudos are due for Air France and KLM. Still, there are improvements to be made.
The first is timing. Purchasing a flight online takes 11 steps, from selecting a flight to checking-out. The SAF opt-in appears at step 8. This isn’t an ideal.
With checkout looming, travelers are nearing their final goal. Like a track star nearing the finish line, these travelers are accelerating their decision-making. This is the goal gradient effect in action. This acceleration means that many travelers won’t even notice the SAF option.
The second issue is value-exchange. Opting-in to SAF comes with an added cost between $20 and $65. In return, members of the airline loyalty program earn Experience Points (XP.)
XP?! Sounds great! But, XP are not airline points. They can’t be used to book flights. They can only be used to advance status levels—of which there are five—each with its own set of perks like lounge access, free checked bags, etc.
So there is some form of value-exchange, but the cost-benefit is hard to compute, especially with glorious check-out looming. But, let’s try here...
To move up from the base status of Explorer to the second tier of Silver we need to gain 100XP in 12 months. Using the example above, contributing $48 to SAF nets us 5XP. At this rate, we’ll need to book 20 SAF flights to earn the 100XP we need to move up just one level. That’s $960.
Was that a typo? No. That’s $960 on top of all the money spent on airfare, and the $960 doesn’t yield an immediate benefit, the airline status is secured for the following year. Who is doing that?
With the behavioral rule of delay discounting in mind—where delayed rewards have less value than immediate rewards—we can wager a pretty safe bet that there aren’t many flyers opting-in. However, what KLM and Air France have started can lead us to better ideas. Let’s move on to those.
Value-Multipliers (New Idea)
Instead of a delayed reward, why not offer a more immediate reward?
Thankfully we have airline points (or miles). All airlines have them and flyers enjoy using them. Unlike XP, which can only be used for perks, points can be used for flights (what people actually want.)
A more enticing SAF program could be designed by offering a points multiplier for SAF flyers. For example, if a flyer buys a SAF fare, their flight is worth 1.5x more points than a traditional fare.
This is a low-cost offer for the airline, and a more enticing reward for the flyer. It can redeemed much sooner (on the next flight) and the opt-in can occur much earlier.
Unlike KLM/Air France’s current opt-in, which appears dangerously close to check-out, a SAF fare would be placed at the start. As flyers browse fares by arrival times and cost, they can select between traditional and SAF options. This puts the opt-in in a place where flyers have more mental capacity to actually consider it.
Default Settings
If you can’t already tell, Nudge by Richard Thaler and Cass Sunstein is a major influence on this piece. In that book, the authors show a wealth of evidence that humans are strongly influenced by default settings. For instance, a majority of people don’t stray from the default settings in their retirement plans when they’re set-up. And they don’t modify these settings for the rest of their lives.
A more pertinent example comes from Germany. A study involved giving the public a choice of electricity sources. Opt-in to renewables and pay extra, or use conventional electricity and pay less.
Classic economic theory would presume that people would opt-in to the cheaper option, but not so in this case. In fact, 69% of people in Germany went with the higher cost renewable option. The reason? The renewable option was the default option. If people wanted cheaper power, they had to take the extra step to opt-out.
That little bit of friction goes a long way in shaping behavior. The same idea can be applied to SAF.
Presume all airlines attached an optional surcharge onto their air fares. Flyers have the option to decline, save money, and endorse traditional fuel. But, the default is to say ‘yes’ to SAF, and pay a little extra.
The Scale of Default Settings
Let’s do a little financial modeling to get excited. By using the German example as a benchmark, we can assume 69% of flyers maintain the default SAF choice. 2.3 million people fly in the U.S. every day. At these rates, a modest SAF surcharge of $8 nets about $12.7 million in just a single day. In a year, the proceeds swell to $4.6 billion.
To put that in perspective, United Airlines—one of SAF’s most active investors—has invested $200 million to date.
Now, is this model wrong? Of course. It’s a financial model and makes a lot of assumptions. But, the precise dollar amount doesn’t matter as much as the core message: 1) people fly a lot and 2) people will spend more when given good incentives and well-designed default settings.
The ocean of money is real, who will be the first airline to tap it?
The challenge of sustainable aviation is real, but the opportunity to nudge people to positive action is just as real. For airlines, the costs to implement these programs is paltry compared to the value they’ll generate for sustainable aviation fuel.
There is work ahead in determining fair prices for SAF surcharges (the $8 in the model above was quite arbitrary) but we know enough about human behavior to have confidence that these new programs will work.
