Zero-emission, guilt-free flights from Hong Kong to Da Nang may soon be possible
American aerospace start-up ZeroAvia, funded by British investors, is transforming the way aircraft for short-haul flights are powered; by using hydrogen.
Boeing seems sceptical, whereas Airbus believes it will fly, potentially creating a divergence in the duopoly’s short-haul strategy
This November, Britain will host the United Nations Climate Change Conference (COP26) in Glasgow, delayed by one year due to the coronavirus pandemic. On the docket will be discussion of aircraft emissions and the impact tourism has on the environment.
The upside of being grounded by the pandemic has been that for much of the past year, air pollution has been perceptibly lower. Though in recent months as economies such as China have picked up substantially, so has the level of dirty air. Certainly, at COP26, there will be a lot to talk about.
The political momentum is already building towards November with activists such as Greta Thunberg starting to surface again, ready for the event. To counter their inevitable criticism of slow environmental progress there has been a speedy move to bring forward climate targets around the globe, particularly now the Americans are back on track under President Joe Biden, reversing climate sceptic Donald Trump’s pull-out of the Paris Climate Accord and recently hosting a “streaming” climate summit.
Greta Thunberg: surfacing again. Photo: AFP
COP THAT
First up was British Prime Minister Boris Johnson, boldly bringing the UK’s climate target forward by about 15 years with a plan to cut carbon emissions by 78 per cent by 2035, which would put the country in a leading position. Importantly, the British government has announced that a new “climate law” will be extended to cover international aviation – possibly the last thing aircraft manufacturers wanted to hear. The Labour Party knocked it back, but let’s give BoJo the benefit of the doubt here as he had an ace up his sleeve.
For the average UK household, these tough new targets will mean a wider adoption of electric cars, more encouragement to walk or use a bicycle, better home insulation, lower meat and dairy consumption, and finally more renewable energy – the UK is already one of the leaders in wind power, which takes care of about a quarter of daily energy consumption. That all sounds good to me, as long as they don’t ban authentic sausages. But undoubtedly, flying will become more expensive, which is bad news for those cheap easyJet flights to the continent for less than you’d pay for a round of drinks in newly reopened UK pubs.
Now, as Johnson released his bold targets, Britain had just unveiled the world’s first commercial hydrogen-powered plane. The aircraft is not a strange spider’s web contraption of super-light materials covered in cling-film, but rather a perfectly standard Piper six-seat aircraft retrofitted with zero emission propulsion by a US start-up, ZeroAvia, developed with partners in the UK which include British Airways. This revelation somewhat took me aback. Only two weeks ago I had been convinced by friends in the industry that a hydrogen, or hybrid hydrogen-electric aircraft, would not be seen in our lifetime. And yet, there it is, flying out of Cranfield Airport in Bedfordshire.
British Prime Minister Boris Johnson. Photo: Reuters
There is an ongoing debate about the impact of aviation on CO2 emissions. From a 2013 study, estimates were being passed around that 8 per cent of all greenhouse gases could be traced back to tourism, and about 40 per cent of that to aviation, about 3.2 per cent of the total. More recent modelling is more conservative, suggesting that aviation generates 1.9 per cent of all greenhouse gases, and 2.5 per cent of global CO2 dumped into the atmosphere. That doesn’t sound so bad, but it is significant when you consider that it is about the total output of countries like Japan or Germany.
LEAVING ON A GASPLANE
With the backing of the UK government, ZeroAvia projects that the plane will be able to commercially carry 20 passengers for 350 nautical miles as early as 2023. That is about as far as you would normally fly between most UK airports, and it would also get you to the continent – Paris Charles de Gaulle Airport is 188 nautical miles from London Heathrow. By 2026, the aircraft is expected to fly 500 nautical miles with an 80-seat capacity. That would get you, say, from Hong Kong to Taipei or Hanoi. By 2030, single-aisle jets with 100 seats would get you from Hong Kong all the way to Sapporo.
By 2035, Johnson’s target date, a plane with 200 seats and a range of 3,000 nautical miles is currently thought possible, which would put just about all European destinations well within reach from the UK. Airbus has also boarded the future and aims to have its own hydrogen aircraft in operation by 2035. But with an upstart like ZeroAvia in the air to challenge the incumbents, the race is on. There will be other, smaller manufacturers looking in earnest at the technology.
ZeroAvia’s hydrogen fuel cell powered flight at Cranfield in September. Photo: Handout
Zero emissions from the aircraft is paramount to the success of ZeroAvia’s project, but to really have zero emissions from a flight, hydrogen fuel needs to be extracted in a way which doesn’t add CO2 to the atmosphere and so there is now a rush to produce ‘green’ hydrogen.
GREEN IS GOOD
Green hydrogen is bothersome to produce in quantity at the moment, though the process sounds deceptively simple. When seawater is electrolysed, oxygen and hydrogen are created, leaving only salt. But the process requires huge amounts of electricity, preferably solar, wind, hydro or geothermal power. So the most efficient place to make it is somewhere where clean energy and seawater coexist. As long as the electricity is clean, the hydrogen is green.
Somewhere sunny or windy and coastal is ideal, which suggests that North Africa, large tracts of the Middle East and perhaps parts of Asia would work. Saudi Arabia is at the start of a mammoth project to produce green hydrogen, a new plant is being built in Taiwan’s Hsinchu Science Park by Air Liquide Far Eastern Ltd., a venture between Paris-based Air Liquide and Taiwan’s Far Eastern Group, and just last week the Australians announced multiple countrywide electrolyser projects funded by the federal government.
Retrofitting drivetrains in small aircraft is one thing. But to compete with short-haul, single-aisle aircraft like the Boeing 737 or Airbus A320, a more complex design for handling hydrogen as a fuel is required. It’ll likely mean increased use of carbon fibre, if only to contain the hydrogen. Carbon fibre has been a growing component in commercial aircraft, and it is a market that has been cornered by a handful of Japanese companies; Toray, Mitsubishi Rayon and Teijin, whose share prices are still substantially far from their long-term highs.
Long-haul travel using hydrogen on the kinds of aircraft we’re used to may be beyond the scope of the technology for the foreseeable future. But as aircraft manufacturer Airbus found to its chagrin with the A380, and regional airlines like Cathay Pacific and Singapore Airlines also discovered, to operate such large equipment with high capital costs and having to consistently fill almost 600 seats per flight, makes them less of a commercial viability.
Boeing has dismissed hydrogen as something to experiment with at the ‘low end’. Photo: AFP
FLY THE FLAG
With backing from British Airways, you’d think ZeroAvia’s development in propulsion would give the aviation industry a significant kick, from aircraft manufacturers, engine suppliers through to functional materials suppliers. Boeing disagrees.
In its Q4 2020 earnings call with investors in January, Boeing president and CEO Dave Calhoun dismissed hydrogen as something just to experiment with at the “low end”. At the airframe size Boeing focuses on, the technology is just not there. Whereas Airbus has some expertise in smaller airframes through its 75 per cent ownership of Bombardier, Boeing terminated its joint venture talks with Embraer in the middle of 2020, which would have led to 80 per cent ownership in the regional aircraft maker. If hydrogen takes off at the “low end”, that might prove to have been a missed opportunity.
Perhaps Calhoun is right, and hydrogen is all just an experiment for small planes. Or maybe he’s betting on a return to power of US Republicans, which would surely delay any American move away from petroleum based fuels. Either way, this seems to represent a divergence in strategy for two aircraft manufacturing giants who have historically competed in the same market with much the same equipment.
Neil Newman is a thematic portfolio strategist focused on pan-Asian equity markets
