At Air Canada, we are sensitive to the effects of air transportation on the environment and are working diligently to minimize our environmental impact through conservation, innovation, and cooperation.

We support the International Air Transport Association—whose primary goal is the promotion of safe, reliable, secure, and economical air transportation for international consumers—in its efforts to monitor these effects, while we continuously search for new and better ways to minimize them.

The predominant concern with the burning fuel for air transportation is the release of carbon dioxide (CO2) into the atmosphere. CO2 represents approximately 70% of aircraft engine emissions, while the remaining 30% is mostly H2O (water), with less than 0.5% NOx (nitrogen oxide), CO (carbon), SO2 (sulphur), UHC (unburned hydrocarbons), and soot.

CO2 emitted by aircraft at cruise altitudes has the same effect as CO2 emitted at ground level. The other gases emitted in flight may also affect the climate, and some may have a different effect at altitude than they do at ground level when emitted by other vehicles, such as cars, ships, and trains.

Worldwide, air transportation and aviation account for 2% of all man-made CO2 emissions. Cognizant of the concerns about the effect of air transportation on the environment, Air Canada acknowledges the need for continued vigilance in relation to the projected growth of aviation services worldwide.

Canadian Greenhouse Gas Inventory 2005
According to a report from Environment Canada, domestic aviation represented 1.16% of the nation’s 2005 Greenhouse Gas (GHG) emissions or 4% of GHG emissions from all forms of transportation.

Source: Environment Canada, national Inventory Report, 1990-2005

Global Emissions
According to the latest report from the Nobel Prize winning Intergovernmental Panel on Climate Change:

• Aviation accounted for 2% of all global CO2 emissions in 2004.
• Transportation accounted for 13% of GHG emissions.
• Of that 13%, road transportation alone accounted for 74%.

Progress at Air Canada
Air Canada has made significant progress in reducing fuel consumption. We measure fuel efficiency by calculating the number of litres it takes to transport 100 tonnes of cargo and passengers one kilometre (or Litres per Revenue Tonne Kilometre, L/RTK).

• In 2007 our fuel efficiency was 38.3 L/RTK
• That is a 30% improvement in fuel efficiency since 1990
• A 66% improvement in fuel efficiency since 1970

Air Canada Commitment
Canada was the first country to implement a voluntary agreement between its federal government and the key players in its aviation industry, the members of the Air Transport Association of Canada.

Air Canada was a lead participant in the development of this agreement, and we have already reached the fuel efficiency improvement target defined within it—to achieve a fuel efficiency improvement of 24% by 2012, from 1990 levels.

At Air Canada we are committed to further limiting our environmental impact by improving fuel efficiency by 25% from 2006 to 2020, representing a 54% improvement in fuel efficiency from 1990 to 2020.

Strategy
Air Canada has worked closely with other airlines within the International Air Transportation Association to develop the best strategy to address the impact of aircraft emissions:

1. Renewal of fleet to improve fuel efficiency

• Significant environmental gains are being made with the introduction of modern aircraft, such as Embraer jets and Boeing 777s, into our fleet.
• The fleet renewal process, which phases out less fuel efficient aircraft to replace them with more technologically advanced and fuel efficient aircraft, will provide a significant increase in the fuel efficiency of Air Canada’s entire fleet.
• On a flight from Toronto to Hong Kong, the Boeing 777-200 is expected to use approximately 15% less fuel per available seat mile than the aircraft they are replacing.

2. Operational measures & fuel efficiency improvements
Air Canada has introduced a variety of creative solutions into our operations to reduce fuel burn. Such solutions require the precise calculation of a complex set of variables that affect departure and arrival times at each of the many airports we serve, including weather, aircraft, passenger and cargo weight, runway length, ground equipment, etc. By tirelessly analyzing such variables, we are now able to burn only the fuel needed to safely operate our equipment. Here are a few of the procedures we now perform routinely to cut back on fuel waste when conditions permit:

• Plan the exact amount of fuel (including reserve supply) needed to safely operate each flight in order to keep the weight of each aircraft as its minimum
• Factor in the scheduled versus actual arrival times to fly at the optimum speed for maximum fuel conservation
• Increase the use of wheel brakes and keep the engines at the idle reverse settings during landing

3. Infrastructure and air navigation system improvements
Air Canada supports domestic and industry wide efforts to increase efficiency within air traffic management systems. According to a special report from the Intergovernmental Panel on Climate Change, addressing the air traffic management system constraints on current flight operations worldwide could reduce CO2 emissions by 6 to 12 percent.

4. Market-based measures
Air Canada supports the International Civil Aviation Organization's role in guiding nations in their application of market-based measures to reduce the environmental impact of aircraft emissions. A specialized agency of the United Nations, the ICAO sets international standards for aviation safety, security, efficiency, and regularity.

Market-based measures are based on the idea that assigning a monetary cost to the environmental impact of aviation will encourage airlines to produce fewer emissions. In other words, if airlines pay fees based on how much CO2 their flights have produced, they are more likely to implement environment friendly procedures and technologies.

Market-based measures may be assigned in the form of an environmental tax or surcharge, an emission trading scheme, or a voluntary measure adopted by the aviation industry.

At Air Canada, we believe that market-based measures should always take into account the interests of all parties concerned, be cost-effective, and deliver a tangible, transparent benefit to the environment.