IDEAS home Printed from https://ideas.repec.org/a/eee/transa/v204y2026ics0965856425004574.html

Willingness to pay for voluntary airline carbon offsets and sustainable aviation fuel

Author

Listed:
  • Li, David C.
  • Beck, Matthew John
  • Merkert, Rico

Abstract

While arguing that voluntary carbon offsetting (VCO) and sustainable aviation fuel (SAF) will continue to play a vital role in the context of airline decarbonization in the future, this paper reveals “low-hanging-fruit” opportunities for airlines to improve the adoption rate of their VCO programs and policy recommendations to make SAF adoption more realistic today. Using a stated preference choice experiment with 1,001 respondents from Australia and New Zealand, we show the value of offering digital information on the carbon offset project purposes, especially those associated with environmental damage repairments and investments into sustainable energy productions. We further explain heterogeneity in preferences for VCOs through socio-demographic differences in the sample. While our results suggest a continued strong willingness to fly, our estimated willing-to-pay (WTP) values for SAF “book and claim” remains relatively low. We highlight the significant gap between the consumers’ WTP and the actual cost of SAF. This gap represents a critical challenge for the airline industry, particularly in light of upcoming policy mandates for SAF usage (e.g., the UK from 2025). Without additional government support, such mandates may pose substantial risks to both airline viability and consumer mobility. We offer recommendations to inform future policy development and effective airline decarbonization strategies.

Suggested Citation

  • Li, David C. & Beck, Matthew John & Merkert, Rico, 2026. "Willingness to pay for voluntary airline carbon offsets and sustainable aviation fuel," Transportation Research Part A: Policy and Practice, Elsevier, vol. 204(C).
    • Handle: RePEc:eee:transa:v:204:y:2026:i:c:s0965856425004574
    DOI: 10.1016/j.tra.2025.104824
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0965856425004574
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.tra.2025.104824?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Md Arif Hasan & Abdullah Al Mamun & Syed Masiur Rahman & Karim Malik & Md. Iqram Uddin Al Amran & Abu Nasser Khondaker & Omer Reshi & Surya Prakash Tiwari & Fahad Saleh Alismail, 2021. "Climate Change Mitigation Pathways for the Aviation Sector," Sustainability, MDPI, vol. 13(7), pages 1-29, March.
    2. Aria, Massimo & Cuccurullo, Corrado, 2017. "bibliometrix: An R-tool for comprehensive science mapping analysis," Journal of Informetrics, Elsevier, vol. 11(4), pages 959-975.
    3. Arsenii Vilkov & Gang Tian, 2023. "Blockchain’s Scope and Purpose in Carbon Markets: A Systematic Literature Review," Sustainability, MDPI, vol. 15(11), pages 1-27, May.
    4. David Talbot & Olivier Boiral, 2018. "GHG Reporting and Impression Management: An Assessment of Sustainability Reports from the Energy Sector," Journal of Business Ethics, Springer, vol. 147(2), pages 367-383, January.
    5. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521766555, August.
    6. Pechstein, Jan & Bullerdiek, Nils & Kaltschmitt, Martin, 2020. "A “book and Claim”-Approach to account for sustainable aviation fuels in the EU-ETS – Development of a basic concept," Energy Policy, Elsevier, vol. 136(C).
    7. Olivier Boiral, 2013. "Sustainability reports as simulacra? A counter-account of A and A+ GRI reports," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 26(7), pages 1036-1071, September.
    8. Revelt, David & Train, Kenneth, 2000. "Customer-Specific Taste Parameters and Mixed Logit: Households' Choice of Electricity Supplier," Department of Economics, Working Paper Series qt1900p96t, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    9. Kenneth E. Train, 1998. "Recreation Demand Models with Taste Differences over People," Land Economics, University of Wisconsin Press, vol. 74(2), pages 230-239.
    10. Paul Chiambaretto & Sara Laurent & Ulrike Schmalz & Mengying Fu & Audrey Rouyre & Camille Bildstein & Anne-Sophie Fernandez, 2024. "Are consumers willing to pay more for green innovations? Insights from the air transport industry," Post-Print hal-04791158, HAL.
    11. Becken, Susanne & Mackey, Brendan, 2017. "What role for offsetting aviation greenhouse gas emissions in a deep-cut carbon world?," Journal of Air Transport Management, Elsevier, vol. 63(C), pages 71-83.
    12. repec:eme:aaaj00:aaaj-04-2012-00998 is not listed on IDEAS
    13. Michael Lokshin & Zurab Sajaia & Iván Torre, 2025. "Who Suffers the Most From the Cost of Living Crisis?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 71(1), February.
    14. Park, Jihyeon & Ryu, Yebin & Kim, Yitae, 2024. "Factors influencing air passengers' intention to purchase voluntary carbon offsetting programs: The moderating role of environmental knowledge," Journal of Air Transport Management, Elsevier, vol. 118(C).
    15. Fifer, Simon & Rose, John M., 2016. "Can you ever be certain? Reducing hypothetical bias in stated choice experiments via respondent reported choice certaintyAuthor-Name: Beck, Matthew J," Transportation Research Part B: Methodological, Elsevier, vol. 89(C), pages 149-167.
    16. Olivier Boiral, 2013. "Sustainability reports as simulacra? A counter-account of A and A+ GRI reports," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 26(7), pages 1036-1071, September.
    17. Hess, Stephane & Palma, David, 2019. "Apollo: A flexible, powerful and customisable freeware package for choice model estimation and application," Journal of choice modelling, Elsevier, vol. 32(C), pages 1-1.
    18. Volker Grewe & Arvind Gangoli Rao & Tomas Grönstedt & Carlos Xisto & Florian Linke & Joris Melkert & Jan Middel & Barbara Ohlenforst & Simon Blakey & Simon Christie & Sigrun Matthes & Katrin Dahlmann, 2021. "Evaluating the climate impact of aviation emission scenarios towards the Paris agreement including COVID-19 effects," Nature Communications, Nature, vol. 12(1), pages 1-10, December.
    19. Talal Yusaf & Louis Fernandes & Abd Rahim Abu Talib & Yazan S. M. Altarazi & Waleed Alrefae & Kumaran Kadirgama & Devarajan Ramasamy & Aruna Jayasuriya & Gordon Brown & Rizalman Mamat & Hayder Al Dhah, 2022. "Sustainable Aviation—Hydrogen Is the Future," Sustainability, MDPI, vol. 14(1), pages 1-17, January.
    20. Braun, Matthias & Grimme, Wolfgang & Oesingmann, Katrin, 2024. "Pathway to net zero: Reviewing sustainable aviation fuels, environmental impacts and pricing," Journal of Air Transport Management, Elsevier, vol. 117(C).
    21. Chiambaretto, Paul & Laurent, Sara & Schmalz, Ulrike & Fu, Mengying & Rouyre, Audrey & Bildstein, Camille & Fernandez, Anne-Sophie, 2024. "Are consumers willing to pay more for green innovations? Insights from the air transport industry," Technovation, Elsevier, vol. 137(C).
    22. David Hensher & William Greene, 2003. "The Mixed Logit model: The state of practice," Transportation, Springer, vol. 30(2), pages 133-176, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mokas, Ilias & Lizin, Sebastien & Brijs, Tom & Witters, Nele & Malina, Robert, 2021. "Can immersive virtual reality increase respondents’ certainty in discrete choice experiments? A comparison with traditional presentation formats," Journal of Environmental Economics and Management, Elsevier, vol. 109(C).
    2. Wang, Yingzhi & Jiang, Xiushan & Ma, Jihui, 2025. "Emissions reduction of air transport and high-speed rail with policy intervention considering the modal competition in a network market: Environment and welfare implications," Transport Policy, Elsevier, vol. 162(C), pages 379-395.
    3. Xu, Yuchao & Zhang, Yahua & Deng, Xin & Lee, Seung-Yong & Wang, Kun & Li, Linbo, 2025. "Bibliometric analysis and literature review on sustainable aviation fuel (SAF): Economic and management perspective," Transport Policy, Elsevier, vol. 162(C), pages 296-312.
    4. Fu, Mengying & Othman, Mohammed M. & Moeckel, Rolf & Hornung, Mirko & Antoniou, Constantinos, 2026. "User preferences for Regional Air Mobility: Insights from Germany," Journal of Air Transport Management, Elsevier, vol. 132(C).
    5. Daan Hulshof & Machiel Mulder, 2020. "Willingness to Pay for $$\hbox {CO}_2$$CO2 Emission Reductions in Passenger Car Transport," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 75(4), pages 899-929, April.
    6. Youssef M Aboutaleb & Mazen Danaf & Yifei Xie & Moshe Ben-Akiva, 2020. "Sparse Covariance Estimation in Logit Mixture Models," Papers 2001.05034, arXiv.org.
    7. Hole, Arne Risa, 2008. "Modelling heterogeneity in patients' preferences for the attributes of a general practitioner appointment," Journal of Health Economics, Elsevier, vol. 27(4), pages 1078-1094, July.
    8. Frick, Bernd & Barros, Carlos Pestana & Prinz, Joachim, 2010. "Analysing head coach dismissals in the German "Bundesliga" with a mixed logit approach," European Journal of Operational Research, Elsevier, vol. 200(1), pages 151-159, January.
    9. Stephane Hess & John W. Polak, 2004. "An analysis of parking behaviour using discrete choice models calibrated on SP datasets," ERSA conference papers ersa04p60, European Regional Science Association.
    10. De Valck, Jeremy & Vlaeminck, Pieter & Liekens, Inge & Aertsens, Joris & Chen, Wendy & Vranken, Liesbet, 2012. "The sources of preference heterogeneity for nature restoration scenarios," Working Papers 146522, Katholieke Universiteit Leuven, Centre for Agricultural and Food Economics.
    11. Rigby, Dan & Burton, Michael P., 2003. "Capturing Preference Heterogeneity in Stated Choice Models: A Random Parameter Logit Model of the Demand for GM Food," 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia 58200, Australian Agricultural and Resource Economics Society.
    12. Isler, Cassiano Augusto & Blumenfeld, Marcelo & Caldeira, Gabriel Pereira & Roberts, Clive, 2024. "Long-Distance railway mode choice in Brazil: Evidence from a discrete choice experiment," Research in Transportation Economics, Elsevier, vol. 104(C).
    13. Siikamaki, Juha & Layton, David F., 2007. "Discrete choice survey experiments: A comparison using flexible methods," Journal of Environmental Economics and Management, Elsevier, vol. 53(1), pages 122-139, January.
    14. Nannan Kang & Erda Wang & Yang Yu, 2019. "Valuing forest park attributes by giving consideration to the tourist satisfaction," Tourism Economics, , vol. 25(5), pages 711-733, August.
    15. Campbell, Danny & Hutchinson, W. George & Scarpa, Riccardo, 2006. "Using Discrete Choice Experiments to Derive Individual-Specific WTP Estimates for Landscape Improvements under Agri-Environmental Schemes: Evidence from the Rural Environment Protection Scheme in Ireland," Sustainability Indicators and Environmental Valuation Working Papers 12220, Fondazione Eni Enrico Mattei (FEEM).
    16. Kim, Sung Hoo & Mokhtarian, Patricia L., 2023. "Finite mixture (or latent class) modeling in transportation: Trends, usage, potential, and future directions," Transportation Research Part B: Methodological, Elsevier, vol. 172(C), pages 134-173.
    17. Deely, J. & Hynes, S. & Curtis, J., 2019. "Are objective data a suitable replacement for subjective data in site choice analysis?," Working Papers 309602, National University of Ireland, Galway, Socio-Economic Marine Research Unit.
    18. Mauricio Sarrias, 2020. "Random Parameters and Spatial Heterogeneity using Rchoice in R," REGION, European Regional Science Association, vol. 7, pages 1-19.
    19. repec:ehu:biltok:5564 is not listed on IDEAS
    20. Boiral, Olivier & Brotherton, Marie-Christine & Talbot, David, 2025. "Anticipating the unforeseeable? ESG risk management in mining companies," Resources Policy, Elsevier, vol. 106(C).
    21. Campbell, Danny & Hutchinson, W. George & Scarpa, Riccardo, 2006. "Lexicographic Preferences in Discrete Choice Experiments: Consequences on Individual-Specific Willingness to Pay Estimates," Sustainability Indicators and Environmental Valuation Working Papers 12224, Fondazione Eni Enrico Mattei (FEEM).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:transa:v:204:y:2026:i:c:s0965856425004574. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/547/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.