With environmentalism being an increasingly hot topic in the aviation industry, we’ve seen many airlines introduce options to carbon offset tickets.
Lufthansa Group has offered this concept on select flights for a couple of years now — this was first trialed in 2022, before being consistently offered as of early 2023 on short haul flights. There’s now an update, as Lufthansa Group is preparing to launch these green fares on long haul flights as well.
Ironically, these green fares almost seem more targeted at business travelers who are also points addicts than anything else. I can’t decide if these are malarkey, kind of genius, or both.
In this post:
The basics of Lufthansa’s green fares
Lufthansa Group is offering fare bundles that are all about environmentalism, known as green fares. As it’s promoted, these fares offer “full CO2 compensation” with the price.
Within Europe, this includes 80% offsetting done “through high-quality climate projection projects” and 20% offsetting done through the use of sustainable aviation fuels. On intercontinental flights, the percentage is instead 90% and 10% (since sustainable aviation fuel is expensive, so that adds up on longer flights).
These green fares were rolled out on short haul flights as of February 2023. It has now been announced that as of December 2024, these fares will be available on Lufthansa Group flights worldwide. This includes flights on Lufthansa, Austrian, Brussels, SWISS, Edelweiss, Discover Airlines, and Air Dolomiti, covering more than 850,000 flights per year. Passengers across cabins are able to book these fares, including those in economy, premium economy, business, and first.
Customers searching for tickets on eligible routes should see these fares alongside the typical fare bands, including Light, Classic, and Flex. These fares don’t just include carbon offsets, but also include free rebooking, and extra status and award miles.
This is part of Lufthansa Group’s goal of halving net CO2 emissions by 2030 (compared to 2019), and becoming carbon neutral by 2050. The company claims that since launching this fare bundle, more than two million passengers have opted for this, offsetting almost 190,000 tons of CO2, which corresponds to the CO2 emissions on more than 1,300 Airbus A350 flights from Munich to New York.
Here’s how Dieter Vranckx, Lufthansa Group’s Chief Commercial Officer, describes this initiative:
“We have set ourselves ambitious goals to make flying more sustainable. To achieve this, we are investing billions of euros every year in new aircraft and pioneering technologies, among other things. With our innovative Green Fares, we are also involving our customers and offering them – as the first airline group worldwide – the opportunity to actively contribute to more sustainable aviation on more than 850,000 flights. Extending Green Fares to the Lufthansa Group’s global long-haul network is an enormously important and consistent step – not only for us, but for the entire aviation industry.”
What makes Lufthansa’s green fares interesting
How are Lufthansa’s green fares priced? Let’s take a look at pricing in economy for a one-way ticket from Frankfurt to Stockholm. Lufthansa has four fare tiers, including Light, Classic, Green, and Flex. The green fare is the second most expensive bundle:
- It offers free rebooking, like Flex, but doesn’t offer free refunds, unlike Flex
- It offers a standard seat reservation, but not premium seating, like Flex
- In addition to carbon offsets, it offers 20% bonus award miles and 20% bonus status miles
What’s interesting is that when these fares were introduced, the pricing was generally in line with the Flex fare, while now the pricing is between the Flex and Classic fare.
I also find it noteworthy how green fares area almost designed in a way so that they could be appealing even if you don’t care about the carbon offsetting aspect of it. Maybe not for those paying out of pocket, but for those who are traveling on business and have some freedom with how they book, I could see people going for a fare that includes 20% extra award and status miles.
It’s a bit ironic that the fare that offers full carbon offsets might actually be most appealing to business travelers who are also status and miles junkies… and that might not be a bad thing?
Bottom line
For a couple of years now, Lufthansa Group has been offering green fares in one form or another. Starting next week, these fares will be expanded to intercontinental markets. As you’d guess based on the name, these fare bundles allow you to offset your carbon emissions, and offer a slew of other perks as well.
I feel like the way these fares are structured, they’re almost intended for people on expense accounts who value their elite status, since there are benefits here beyond the offsets.
Personally I’m a big fan of how Air France-KLM approach carbon offsets, as you can earn a variable number of XPs (the system for qualifying for status) by paying to offset your flight.
What do you make of the Lufthansa Group green fares?
Ben, I am frankly disappointed with how much you cover Lufthansa Group. They are single handedly trashing air travel experience for all European carriers....
This is just another ripoff... they are still flying A340's that are horribly fuel inefficient.
Really wanna protect the environment?
Just tell China and India to implement some real, non-hypocritic eco-pro policy.
No other option would work if those two keep pollute the globe.
Wait, they've got a ton of apologists in almost every country's politics.
Nevermind, it would be impossible to actually improve the situation.
Sorry Earth that we suck.
This is clever from Lufthansa from a purely economic point of view. They are obliged to pay for The EU CO2 émission trading scheme and ICAOs CORSIA. Now they are simply passing on the costs to the passenger. In other words: If you buy this ticket, Lufthansa can reduce the costs they are obliged to pay anyway! Lufthansa and Carsten Spohr have in my opinion again and again shown they are only “Greenwashing”. If Lufthansa...
This is clever from Lufthansa from a purely economic point of view. They are obliged to pay for The EU CO2 émission trading scheme and ICAOs CORSIA. Now they are simply passing on the costs to the passenger. In other words: If you buy this ticket, Lufthansa can reduce the costs they are obliged to pay anyway! Lufthansa and Carsten Spohr have in my opinion again and again shown they are only “Greenwashing”. If Lufthansa was truly green, how can they propose something so bad for the climate as they recently did, when they asked EU to demand all airlines flying to EU to avoid Russian airspace? If that is implemented the additional fuel burned by Chinese airlines will be a huge additional pollution. I totally from a business point of view, but that is not a green company proposing something like that. Would appreciate if they just were honest: Lufthansa cares about the financials, period.
There are sanctions against Russia in case you forgot. Why should Putin benefit from Chinese airlines over-flying their borders and paying for it on the way to EU? Of course Germany are right to demand it from the EU.
"Now they are simply passing on the costs to the passenger."
Economics 101: ALL costs get passed onto the customer unless either the corporation's managers are willing to accept a lower gross margin or they can find a way to pass the cost on to the government, in which case everyone pays. What do you think the corporation's choice will be? It sure won't be accept a lower gross margin!
"Lufthansa cares about the financials,...
"Now they are simply passing on the costs to the passenger."
Economics 101: ALL costs get passed onto the customer unless either the corporation's managers are willing to accept a lower gross margin or they can find a way to pass the cost on to the government, in which case everyone pays. What do you think the corporation's choice will be? It sure won't be accept a lower gross margin!
"Lufthansa cares about the financials, period."
Well, not really: One must never forget Lord Thurlow's observation:
"Corporations have neither bodies to be punished, nor souls to be condemned, they therefore do as they like."
It's the greedy managers who care about the financials and little else. Perhaps the answer is to take a page from the playbook of U.S. judges who used to sentence slum landlords to live a month in the hovels they were renting; maybe airline executives should be periodically compelled to spend a couple of weeks on the road at the mercy of their own creations.
Sorry if I was unclear.
Yes there are sanctions and it’s a solid economic (and political) argument that Chinese airlines shouldn’t benefit from it. My point is that Lufthansa frames their point of view as being “Green”. If they were honestly green, then they shouldn’t argue for not flying over China, as that would increase overall emissions.
In regards to the “passing on to consumers”. Lufthansa are obliged to pay for their emissions...
Sorry if I was unclear.
Yes there are sanctions and it’s a solid economic (and political) argument that Chinese airlines shouldn’t benefit from it. My point is that Lufthansa frames their point of view as being “Green”. If they were honestly green, then they shouldn’t argue for not flying over China, as that would increase overall emissions.
In regards to the “passing on to consumers”. Lufthansa are obliged to pay for their emissions through the EU Carbon trading scheme and CORSIA. If they didn’t have “Green fares”, then all those costs would be passed on to the consumer. By introducing “Green fares”, the additional money passengers voluntarily are paying, can be used to decrease Lufthansa’s direct payment to the trading scheme and CORSIA. In other words: If you don’t buy a “Green fare”, Lufthansa have to pay to the Trading Scheme and CORSIA from the overall ticket price. If you do buy a “Green fare”, you are saving money for Lufthansa, as you are paying to the Trading scheme and CORSIA by yourself.
Hope that clarified.
Carbon offset scams.
They just do it at COP level.
Matter of time before the you would be allow you to offset criminal conviction.
Wait, rich people can already get away with murder.
Lufthansa's green fares are almost entirely based on carbon offsetting projects which are unclear. This is a strategy to get "ethically conscious" (heavy quotation marks there) flyers to pay more for what is most likely not a substantial offset of their emissions. It seems Lufthansa has found success with this, as they are expanding it. But it's a profit making scheme, nothing to do with the environment.
The problem is that it includes 80% (or 90%, respectively) of unclear compensation projects and only 20% (or 10%) SAF.
And as a corporate traveller, you don’t get a certificate, you would need for the ESG reporting of your employer. So bottom line, not intriguing at all, but pretty useless.
I’ve been curious what effect the shift to dollar-based programs in the US has had on businesses where people book their own travel. For the ethically challenged, why not book that $450 fare instead of the $200 fare? Smart move by the airlines, but not so great for some businesses.
People who are ethically challenged rarely limit their unethical behavior to one domain. Sooner or later they get caught with something else. Paul, Weiss has expertise investigating workplace shenanigans.
Every person has their own moral codes, this thing might look clear cut but it isn't always. To give a less straightforward example, employers who are expecting staff to travel outside of working hours and without being paid any overtime or given time off in lieu may not see anything wrong with the practice, but clearly there are ethical implications to it. Taking your logic further would mean that such an employer is willing to...
Every person has their own moral codes, this thing might look clear cut but it isn't always. To give a less straightforward example, employers who are expecting staff to travel outside of working hours and without being paid any overtime or given time off in lieu may not see anything wrong with the practice, but clearly there are ethical implications to it. Taking your logic further would mean that such an employer is willing to seriously cut corners when it comes to health and safety (after all, time off work is important to ensure employees can switch off and recover from work pressures), it's an interesting argument but I don't think that many people share your viewpoint.
If anything, anyone who's ever investigated potential employee misconduct should know that there are multiple sides to each story and that ascribing motivation to actions or omissions frequeny ends up being little more than speculation.
Also known as sucker fares.