Air NZ announces it is working with Airbus to develop hydrogen aircraft, but it is contracted to keep buying new fossil-fuelled planes that will dot our skies until 2050.

Analysis: Air NZ expects to trial “drop-in” sustainable aviation fuel in jets out of Singapore this year or next, it tells Newsroom. It is today announcing a collaboration with Airbus to design hydrogen-fuelled planes and assess how they’ll be integrated into the airline’s infrastructure by 2035. And it plans to have an electric or hydrogen turboprop aircraft in its fleet by 2030. 

So the airline is taxiing to the runway – but its route to decarbonisation is no short hop. It intends to keep buying petroleum-fuelled jets for 10 years and flying them for another 20-plus years, despite having announced a goal of net zero carbon emissions by 2050.

This is a very long haul, with a distinct lack of ambition that would be unimaginable for almost any other NZ company. Air NZ can only get away with such slow decarbonisation because international flight is not included in NZ’s emissions limits.

Other airlines are far more ambitious. Aviation company Ampaire has been flying 15-minute inter-island hop trial flights in partnership with Hawaii-based Mokulele Airlines, for more than a year, and began hybrid-electric commercial trials in the UK last month.

United Airlines in America has ordered 100 electric aircraft from Heart Aerospace, a Swedish company. And last month, right here in NZ, Blenheim-based Sounds Air committed to buying three 19-seater ES-19 aircraft from Heart. 

With an expected range of 400km, these will likely save some 75 percent on fuel costs and 50 percent on maintenance costs compared with fossil-fuelled aircraft. Sounds Air expects to take delivery of them in 2026.

Ampaire’s electric EEL has been flying 15-minute inter-island hop trial flights in partnership with Hawaii-based Mokulele Airlines, for more than a year. Photo: Supplied/Ampaire

Hydrogen and electric are fast-developing technologies that will provide decarbonisation for short haul trips. Electric planes could be recharged off the renewable power on NZ’s grid; hydrogen could offer greater range and also be produced with renewable energy – Meridian is investigating turning over much of its southern hydro generation to hydrogen production, if or when Tiwai Point aluminium smelter shuts down. But it would then have to be shipped or piped to the airports.

Air New Zealand chief operational integrity officer Captain David Morgan says the airline will work closely with Airbus to understand challenges like the achievable flying range, and what ground infrastructure or logistics changes may be necessary to fuel hydrogen cells in planes on NZ airport tarmacs.

In an interview with Newsroom, he acknowledges the airline’s commitment to buying eight Boeing 787 Dreamliners. Their deliveries will be spaced over the 2023 to 2028 financial years. Air NZ is also buying nine Airbus A320/A321 neos over the next three years, and one turboprop ATR72-600 this year. Then in 2030 it will buy new Bombardier Q300s for its turboprob fleet.

“If we take delivery of a 787 in a few years’ time, that aircraft is going to be in the fleet for at least 20 years, probably longer. And the technology of that fleet isn’t going to change.”
– Capt David Morgan, Air NZ

Its interim financial statements identify $2.47b committed to the purchase of new planes and engines. Morgan says the airline expects its planes to have an operational lifespan of at least 20 years – meaning the last of its contracted aircraft acquisitions will be in the air until 2048, and other purchase plans will push that out beyond 2050.

“If we take delivery of a 787 in a few years’ time, that aircraft is going to be in the fleet for at least 20 years, probably longer,” Morgan says. “And the technology of that fleet isn’t going to change. So the only way we’re going to be able to make that aircraft more carbon neutral is to fly it more efficiently, or power it on sustainable aviation fuels.”

One solution, for those planes, will be to drop-in increasing amounts of sustainable aviation fuel (SAF). This is already on the market, and Morgan says he tried to fuel up three Air NZ jets with a petroleum/SAF mix in Singapore just recently. Unfortunately, they couldn’t get the supplies to the airport where the planes were undergoing maintenance, but he expects to try again this year or next, in Singapore or Los Angeles. “Those conversations are well advanced.”

United Airline and Mesa Airways have together placed purchase orders for 200 Heart ES-19 electric aircraft, for delivery in 2026. Photo: Supplied/Heart

Air NZ has asked the government to include aviation in its biofuels mandate, ensuring all airlines refuelling in NZ comply with the same obligation to transition to a SAF blend. And given the airline’s dominance of the domestic market, he acknowledges it could “potentially” move unilaterally to a SAF blend here.

For the long-haul flights, so-called sustainable aviation fuel is the only real alternative – and New Zealand’s remote geography makes that important. NZ-founded LanzaTech is working with Air NZ in a local consortium to develop carbon monoxide-capture technology at steel mills like Glenbrook, to turn it into synthetic fuels. 

The consortium wants to use wood waste from forest harvests in Northland as the feedstock for LanzaTech’s system, as Air NZ explains. This would involve repurposing the hydrocracker at the Marsden Point refinery after it stops making petrol, diesel and jet fuel next year. 

“New Zealand has a unique opportunity to be a world leader in the adoption of zero emissions aircraft, given the country’s commitment to renewable energy which can be used to generate green hydrogen and our highly connected regional air network.”
– Greg Foran, Air NZ

In the next two weeks, Refining NZ’s board is expected to confirm plans to shut down its refining operations – and it is looking for quick decisions on Government investment in biofuels before it finally decommissions the plant and lays off its staff in the first half of next year.

As well as producing biofuels from Northland’s forestry waste, Refining NZ has floated the idea of producing hydrogen. The company is already one of NZ’s biggest producers of steam reformed hydrogen, but the demand will be for green hydrogen.

Meridian has a number of hurdles to cross to produce green hydrogen in Southland, but none looks insurmountable. “We are in the early stages of determining what the best mechanism would be for transporting hydrogen, but at the moment we’re considering all options,” a spokesperson said this week. “We have also only just commenced the return-on-investment evaluation process.”

Hiringa Energy has $20m government funding to start producing green hydrogen from renewable electricity and water at a facility in Kapuni, South Taranaki. And quite a number of other companies are working on hydrogen projects, and have even signed a Letter of Intent to sell large quantities to South Korea. 

This all feeds into Air New Zealand’s announcement this morning of a joint initiative with aircraft manufacturer Airbus to research how hydrogen-powered aircraft could assist the airline with reaching its goal of net zero emissions by 2050.

In a first for the Asia-Pacific region, the two organisations have signed a memorandum of understanding to cooperate on a joint research project. The airline will analyse the impact hydrogen aircraft would have on its network, operations and infrastructure; Airbus will provide hydrogen aircraft performance requirements and ground operations characteristics to support a rollout plan.

Air NZ chief executive Greg Foran says it’s an exciting step towards putting hydrogen-powered aircraft in the skies over New Zealand. “New Zealand has a unique opportunity to be a world leader in the adoption of zero emissions aircraft, given the country’s commitment to renewable energy which can be used to generate green hydrogen and our highly connected regional air network.”

“At this stage, both hydrogen and battery electric aircraft are still on the table as potential options for our shorter domestic flights, along with sustainable aviation fuel for long haul operations. This research will help to inform future decision making as we work to decarbonise the airline.”

Airbus Asia-Pacific president Anand Stanley says the agreement with Air NZ will provide important insights about how the plane-builder could put a zero-emission aircraft into service.  It would provide invaluable feedback on what airlines expect, and their preferences in terms of configuration and performance.

Airbus is currently looking at three concepts for hydrogen-powered aircraft, including a jet (turbofan), turboprop, and blended wing option.

David Morgan says there are three ways the airline industry will reduce emissions: sustainable aviation fuels, alternative energy sources, and very different planes like the Airbus’s blended wing-body.

“These have very different engines and very different body shapes that are far more efficient than the ones we have today. A blended wing-body produces very little drag, and a lot of lift. It’s a shape that unusual for the airline industry because we’re used to long cylinders with lots of windows.”

So why aren’t these blended wing-body aircraft being flown already, even with existing fuel sources? “Major manufacturers build aeroplanes that their customers want, and what they want is aeroplanes that look like the ones we see out the window today.”

Until now, people have wanted planes to look familiar. But with planes like the Airbus blended wing-body aircraft, that’s about to change. Image: Supplied/Airbus

Already, planes have become dramatically more fuel-efficient. There was a step-change from the 747 to the 777, Morgan says, and another 20 percent fuel saving in the step up from the 777-200 to the 787-9.

So even without new energy sources, he argues it’s worth continuing to swap out old planes for new ones.

That may eventually include blended wing-body options like the concept they’re developing with Airbus.

Until now, with an industry and a customer-base that is understandably risk averse, people have wanted planes to look familiar.

“We all know that’s going to have to change, and it’s going to have to happen sooner rather than later if we want to meet our carbon neutral aspirations by 2050.”

Newsroom Pro managing editor Jonathan Milne covers business, politics and the economy.

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