Qantas Airways will conduct a feasibility study into the possibility of an Australian sustainable aviation fuel industry, funded by the Australian government.
The announcement was made in line with the airline's first flight using biofuel derived from recycled cooking oil from Sydney to Adelaide and back on Friday, 13 April 2012.
"We are delighted to be operating Australia's first sustainable aviation fuel flights and to be launching a study into the feasibility of producing such fuel in this country," says its chief executive Alan Joyce.
"Alternatives to conventional jet fuel are vital to the aviation industry meeting ambitious targets for carbon-neutral growth and emissions reduction. Until sustainable aviation fuel is produced commercially at a price competitive with conventional jet fuel, we will not be able to realise its true benefits. This study aims to tell us how that can be derived in Australia," says Joyce.
He adds that Australia has the skills, resources and infrastructure to take a lead in the sector which could generate up to 12,000 jobs over the next 20 years.
"But there are also significant challenges - which is why we need to establish a clear plan."
Qantas' low-cost subsidiary Jetstar Airways will also conduct a biofuel operated flight, flying from Melbourne to Hobart and back, on 19 April.
The fuel type is a 50:50 blend of biofuel and conventional jet fuel. Its "life cycle" carbon footprint is around 60% smaller than conventional jet fuel, Qantas says.
The feasibility study will commence in May with technical support from Shell and government funding for the study will be allocated under its Emerging Renewables Program, Qantas adds.