A state aid request by Austrian Airlines could be an opportunity to make the carrier more sustainable. But climate conditioning bailouts was recently given short shrift by the EU’s transport Commissioner, who is “undermining the Green Deal”, according to Austria’s Greens. EURACTIV Germany reports.
Since Tuesday evening (28 April) it has been clear exactly how much money Austrian Airlines (AUA) needs, after the flyer applied for €767 million in state aid.
Lukas Hammer, climate and energy spokesman for the Austrian Greens, told EURACTIV Germany that it will amount to a partial nationalisation of the airline. Calculated per job, it is “disproportionately high” compared to the support for other companies, he added.
What exactly the conditions for state aid should look like is not yet publicly known. Two weeks ago, the Green Minister of Transportation, Leonore Gewessler, suggested tying any cash injection to sustainability obligations.
But so far, she has only vaguely outlined her plans in an interview with Austrian newspaper Kurier, addressing issues like short-haul flights and sustainable fuels.
European Commissioner for Transport, Adina Vălean, spoken out against such instruments in an interview with EURACTIV. She made no specific reference to the Austrian plans but generally spoke out against green conditions for corona state aid for airlines.
“When talking about investments in greening measures while companies are facing bankruptcy, we need to have more caution,” she said, adding that “raising these conditions now is not necessarily something I would support.”
The Romanian official added that aviation is “one of the most competitive industries” and it is “a fact that we need aviation”.
Hammer said such statements are “irresponsible” and demanded that “an EU Commissioner should take a more serious approach to such an issue”.
“The Commissioner is thus undermining the Commission President’s Green Deal,” he said, adding it would be counterproductive “if we make climate protection investments with one hand and do something in the opposite direction with the other.”
According to Hammer, it is not about pointing the finger at individual actors, but about acting in an economically sensible way, because the climate crisis “is not a theoretical construct, but has costs, and we have a responsibility to minimise those costs.”
Companies with a particularly high carbon footprint, such as airlines, should make a special contribution to this, he added.
AUA should have developed a climate strategy on how to contribute to Austria’s climate neutrality policy by 2040 but that has not happened, Hammer said.
No restructuring for Lufthansa
Under normal circumstances, the government could not dictate to private actors what long-term strategies they should pursue. But in the current situation, AUA would go bankrupt without state aid, meaning conditions are feasible.
Negotiations with AUA and its German parent company Lufthansa should be clearly “open-ended”, Hammer insisted. One would also have to consider: “Can AUA even prove its future economic survival? What we will certainly not do is to indirectly restructure Lufthansa.”
AUA has been a subsidiary of the German flag-carrier since its privatisation. If one helps companies that play such a role in climate change, it would be “irresponsible to support them unconditionally.”
The AUA was not surprised by the Green minister’s initiative. “That is understandable, a Green party must demand this,” said Julia Kraft, AUA Manager for International and Environmental Affairs, in an interview with EURACTIV Germany.
Even before the formation of the government, the Greens had been in close contact with the company and had agreed on many things, for example on the fight for fair working conditions in Vienna for low-cost airlines.
However, there was no agreement on the climate protection conditions for state aid, Kraft is still waiting for a plan. But in the two fields Gewessler mentioned in the media, short haul and sustainable fuels, the AUA is already active.
To reduce short haul flights, it is running the “AIRail” project with the Austrian Federal Railways (ÖBB). Alongside Austrian short-haul flights to Vienna, which act as ‘feeder flights’ for long-haul trips, there are trains with a fixed ticket quota for AUA customers.
AIRrail has been operating between Linz and Vienna since 2014, and in 2018 AUA was able to suspend this short-haul flight, particularly for ecological and economic reasons. Another AIRail route is Vienna-Salzburg, and further talks with ÖBB are underway in this regard.
“We are doing what we can”
According to Kraft, AUA is involved in several research projects in search of more sustainable fuels. For example, since 2018, they have been running a cooperation with Austria’s largest oil and gas company, OMV, in which plastic is reprocessed into oil.
AUA is also working with several scientific stakeholders in Austria on research into synthetic fuels.
“We are pioneers here and are doing what we can,” says Kraft and emphasises that AUA would like to fly with alternative fuels, because they could reduce CO2 emissions by up to 80%.
However, too little is still being produced. Only 0.1% of the world’s kerosene requirements can be covered by biofuels and the production of synthetic kerosene is still in the research phase, meaning costs are still too high.
[Edited by Sam Morgan]