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Sustainability

Could Sustainable Aviation Fuel help airlines’ net-zero efforts take off?

Airline companies have committed to achieving net-zero by 2050 but meeting such an ambitious target is not going to be easy. As Alvaro Vivanco, Head of ESG Macro Strategy, explains, Sustainable Aviation Fuel (SAF) could represent their best chance.

Airlines are coming under increasing pressure to cut emissions and adopt sustainable practices in their operations as scrutiny of the aviation industry’s carbon footprint intensifies. The industry is responsible for about 2% of global greenhouse gas emissions – similar to the proportions stemming from waste in landfills (1.9%) and deforestation (2.2%). Passenger travel accounts for 81% of the industry’s emissions, with the remaining 19% resulting from freight transport.

Due to the nature of aviation it’s hard for the industry to reduce its emissions, but that hasn’t stopped it from committing to an ambitious goal of reaching net-zero by 2050. Various public-private partnerships seek to reduce emissions through solutions such as new aircraft technology, efficient operations, and the development of additional alternative fuel sources such as electric and hydrogen. But of all the potential ways for airlines to cut emissions, Sustainable Aviation Fuel (SAF) seems to hold the most promise.

SAF: the industry’s best chance at achieving net-zero?

What exactly is SAF? It’s very similar in chemistry to traditional aviation fuels, but it’s produced from renewable biomass and waste resources such as corn grain, oil seeds, algae, fats, agricultural and forestry residues. It can reduce carbon emissions by as much as 80% over the fuel’s lifecycle relative to traditional aviation fuel, and it’s already been used in over 370,000 flights since 2016 according to the International Air Transport Association (IATA).

Lower greenhouse gas emissions are only one of SAF’s sustainability-enhancing features. As well as resulting in reduced emissions, regulations dictate that SAF should also respect biodiversity and conservation, reduce pollution, and contribute to local economic development. It’s also vital that its production doesn’t conflict with the need to grow food crops or use too much water. SAF succeeds on all fronts, and its production from a wide range of sustainable feedstocks also reduces the volatility of its price.

A brief history of SAF

Boeing has played a big role in SAF’s story, having begun test flights using SAF as far back as 2008. It gained approval for the fuel’s commercial use in 2011 and enabled airplane delivery flights using SAF in 2012. As part of Boeing’s ecoDemonstrator programme, the world’s first commercial airplane test flight using 100% SAF took place in 2018 on a 777 in partnership with FedEx. And in 2019, Boeing began offering its customers the option to power their commercial delivery flights using SAF.

On 1 December 2021, United Airlines made aviation history with the first passenger flight with an engine fully powered by SAF. United used 500 gallons of SAF in one engine and the same amount of conventional jet fuel in the other to show that the two kinds of fuel are equally effective. Even more recently, DHL announced plans to acquire 8 million gallons of SAF, the use of which is expected to prevent 80,000 tons of carbon emissions over a three-year period.

Is mass adoption of SAF practical?

SAF clearly has some very attractive attributes but scaling up production remains challenging. So does the sheer size of the jet fuel market: global demand is expected to increase from 106 billion to 230 billion gallons of fuel between 2019 and 2050.

Another issue is SAF’s price: it costs two to six times more than conventional fuel, depending on the source of energy, which is a big problem given that fuel accounts for 20–30% of an airline’s operating cost.

Research, development, and partnerships are needed to help bring the cost of SAF down. Fuel certifications, government subsidies and production partnerships will all have important roles to play in breaking down barriers.

Book and Claim system to play a role

A means of trading SAF will also be critical if it is to be widely adopted. Under the “Book and Claim” system, an airline wishing to use SAF at an airport that doesn’t use the new fuel can buy (or “book”) it from elsewhere. Its flight would receive standard fuel, while another airline would get the SAF at a SAF-compatible airport.

This system takes advantage of one of SAF’s most attractive qualities: its compatibility with regular fuel. This means there is huge scope for airlines to reduce their scope 3 emissions – something that has been a difficult task in the past. But for the concept to work, an international agreement would need to be in place, with each airline that pays the price premium for SAF receiving a credit for doing so.

A promising outlook

Airlines’ efforts to reduce carbon emissions have ramped up in recent years, but like many sectors that depend heavily  on conventional fuels it faces big challenges on the flight path to net-zero. With tourism set to rebound as the world moves out of pandemic the issue looks set to grow in prominence once again as clean flying moves to the top of the agenda.

SAF’s proven ability to fuel flights represents a major cause for optimism. Though it remains expensive for now, we expect subsidies, research, and public support to play major roles in its mass adoption.

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