True or false? Garbage, cooking oil, old clothes and woodchips are some of the raw materials that can be used to make aviation fuel.
All true. And not just fuel, but sustainable aviation fuel. These so-called SAFs are being touted as an elixir that will offer aviation a way out of a big carbon problem. SAFs have the potential to become a significant part of new approaches to enable an industry that relies entirely on fossil fuels today to lower carbon pollution tomorrow.
Historically, fuel has not been a big strategic issue for commercial aviation – it is simply a costly essential, representing 30% or more of an airline’s total cost base. It is also a volatile cost, skyrocketing and plummeting in response to wars, global crises or, as we are seeing today, a pandemic.
But that is changing. Fuel is turning into a strategic asset as the aviation industry, with varying degrees of enthusiasm and reticence, joins the global movement to lower its carbon emissions and play its part in tackling climate change.
Most estimates say aviation produces about 2% of total global greenhouse gas emissions – but this may be magnified by other factors, with research pointing toward the significance of the non-CO2 climate impact from aviation, such as NOx, soot and contrails.
The industry’s common target is to reach net zero emissions by 2050, with many airlines having announced their commitments to achieving net zero, and many more set to follow.
Scott Kirby, the chief executive of United Airlines, is prominent and outspoken on this topic. In a LinkedIn post in December, he said: “We’re embracing a new goal to be 100% green by 2050 by reducing our greenhouse gas emissions 100%. And we’ll get there not with flashy, empty gestures, but by taking the harder, better path of actually reducing the emissions from flying.”
The problem for aviation is this is easier said than done. Today, the only fuel source is fossil-based and there is no obvious way of quickly slashing emissions. Carbon offsetting is one option – and although this does something, many see this approach as no more than a temporary sticking plaster.
Aircraft powered wholly by electricity are gaining prominence. This technology offers the potential to deliver sustainable short-haul flying using aircraft with up to 50 seats in the second half of this decade. Hydrogen fuel is another much-discussed candidate, but that is thought unlikely to become viable until well into the 2030s.
Most agree that the only realistic alternative power source, especially for heavier aircraft, is sustainable aviation fuel. In its November 2020 report Blueprint for a Green Recovery, aviation environmental coalition the Air Transport Action Group (ATAG) describes a rapid and worldwide scale-up of SAF as “perhaps the single largest opportunity to meet and go beyond the industry’s 2050 goal”.
The World Economic Forum November 2020 report, Clean Skies for Tomorrow, concluded that “there is no ‘silver bullet’ overarching approach for aviation’s decarbonisation, but SAF is a necessary asset in the transition”.
The key word in SAF is sustainable – because this fuel is not pollution free. The improvement comes as a result of the fact that the SAF production process itself absorbs CO2, according to a recent report from consultancy McKinsey.
“If you look at our product the reduction is up to 80% on a life-cycle basis,” says Sami Jauhiainen, vice-president, business development, renewable aviation at Finnish renewable fuel producer Neste.
According to ATAG, SAF can be described as reducing emissions on a life-cycle basis because the CO2 that is absorbed by plants during the growth of biomass is roughly equivalent to the amount produced when the fuel is burned in a combustion engine, which is then returned to the atmosphere.
While there are several terms used to describe sustainable or alternative fuel, the term SAF has become a catch-all for non-fossil-based aviation fuels. The first phase of SAF uptake happening now is being driven by use of bio-based waste and residue raw materials.
In time these will be complemented with e-fuels or electro-fuels. These alternatives are manufactured with captured CO2 in a reaction with hydrogen and using renewable electricity.
While it is true that burning SAF causes the same carbon emissions as burning regular jet fuel, the avoidance of using fossil fuel in the first place is key, says Lauren Riley, managing director, global environmental affairs & sustainability at United. The airline has been using SAF daily on its flights at Los Angeles International airport since 2016.
“SAF and carbon capture are the two known pathways today for airlines to decarbonise,” says Riley. “My vision for 2050 is 100% of our planes fuelled by SAF and significant carbon sequestration to mitigate the emissions from the past.”
The industry has been quietly working on SAF development since 2006. The Commercial Aviation Alternative Fuels Initiative (CAAFI) was formed that year by US aviation bodies including the Federal Aviation Administration and Airlines for America to foster the development and commercialisation of SAF.
“The aim is that blended SAF is a ‘drop-in’ jet fuel, so no changes are required in aircraft or engine fuel systems, distribution infrastructure or storage facilities,” says Steve Csonka, CAAFI executive director. “As such, blended SAF can be mixed interchangeably with existing jet fuel.”
This is the case for industry-approved SAF production pathways today at blend levels of up to 50% with regular jet fuel. Work is under way on higher blend levels that will enable SAF to deliver deeper carbon reductions, Csonka says.
In recent months, Rolls-Royce has conducted tests with a Trent 1000 and a Pearl 700 turbofan exclusively powered by SAF. “Our aim is to give the industry confidence that we can continue on to 100% SAF certification,” says Simon Burr, director of engineering & technology at R-R. “The engines behaved exactly as expected.”
Boeing flew dozens of 100% SAF test flights in the late 2000s, but it was a Virgin Atlantic 747-400 demonstration flight from London Heathrow to Amsterdam – with founder Sir Richard Branson’s typical razzmatazz – that brought greater publicity to alternative fuels.
SAF development has continued steadily throughout. The latest breakthrough, which came in February, saw a SAF produced in a “lower-carbon pathway” power the first commercial flight with an e-fuel blend. This significant move was achieved with a SAF made by Shell from synthetic kerosene (from CO2 and hydrogen, not biomass) and powered a KLM service from Amsterdam to Madrid.
Tests and demonstration flights aside, several front-running airlines have been using SAF for five years in regular operations.
Cathay Pacific started researching the nascent SAF industry in the USA for use in its transpacific operation in the early 2010s. It was attracted to California-based Fulcrum Bioenergy’s strategy of “low-carbon fuel made from trash”. To secure access to Fulcrum’s SAF, Cathay invested in the firm in 2014. Others, like United and BP, followed suit.
Over recent months Cathay has developed a SAF deployment strategy as part of its net zero commitment, says Yee Chow, the airline’s biofuel manager.
“We are producing a roadmap of what percentage of SAF we can achieve at what cost, by when,” he says. “There are plenty of unknowns, but it is all about putting a stake in the ground.”
However, such pioneers are currently something of an exception in the industry. The adoption of SAF in air transport has been slow when compared with other sectors, which have latched on to sustainable options much faster.
“Aviation’s use of SAF has progressed a lot slower than road transport’s use of sustainable fuel – it’s 15 years behind, even though the product is not in reality any different,” says Neste’s Jauhiainen.
The main barriers to SAF adoption have been high cost and limited availability. SAF is three to five times the price of jet fuel today. That will fall as SAF production rises and incentives for its use arrive.
Currently the uptake of SAF is minuscule compared with the volume of jet fuel burnt in a normal year. Airlines used about 300 million tonnes in 2019. SAF only made up about 0.1% of this.
But that is changing. Over the past year, SAF has become a hot topic. “It’s a once-in-a-century chance for an industry to develop new energy sources,” says Darrin Morgan, head of growth and investment at SkyNRG, a Dutch outfit that KLM helped found in 2010 to develop the SAF market. “We see it not as a defensive activity but as an opportunity.”
SAF producers are using the same business models as the traditional energy industry – including renewable sources such as wind and solar power – to bring investors to the table. “Long-term offtakes facilitate project financing – it makes perfect sense,” says Morgan. Offtakes is the jargon used where airlines commit to a multi-year fuel deal with producers. However, less than a dozen airlines have taken the plunge so far with such SAF agreements.
While rising SAF production will bring the cost down and usage up, policy change will be essential too. “There needs to be a highly effective set of measures led primarily by governments,” says Andrew Murphy, aviation director at Brussels-based sustainable transport advocacy group Transport & Environment. “Aviation cannot decarbonise by itself.”
These rules, likely to specify how much SAF must be blended with regular jet fuel, and financial incentives for users, are in the making, along with the lobbies to influence them. California, the Netherlands and Norway already have SAF usage policies.
Norway became the first country in the world to bring in a mandate in 2020, stipulating that 0.5% of all fuel usage is SAF. Its target is to get to a 30% requirement by 2030.
At a recent government conference, several European transport ministers and the European Commission lined up to support the SAF drive. It was timed to influence the EC’s publication later this year of its policy – called ReFuelEU Aviation – to boost the supply and demand for SAF in the EU. This could see a SAF mandate in place by 2025.
Many other countries are preparing legislation that will compel airlines to blend a proportion of SAF into their aviation fuel use.
“The time is now for governments to come in and help scale that gap,” says Riley of United. “The focus must be decarbonising aviation and policies should be technology, feedstock and producer neutral.”
It is a common cliche around major industry challenges, but all believe collaboration is key to making SAF a success in reducing aviation’s carbon footprint. “Our ambition at Shell is not only to fulfil industry demand but help accelerate this journey,” says Anna Mascolo, global president of Shell Aviation.
The scale of the ramp-up and this collaborative effort is illustrated by the sheer volume of SAF needed to meet aviation’s travel demand. ATAG estimates some 450-500 million tonnes annually by 2050. The World Economic Forum puts current output of all sustainable fuels – used by aviation, road transport and others – at just 5.5 million tonnes.
SAFs will be an important part of aviation’s decarbonisation drive, and are likely to make up more than half of the target. And most believe the current global crisis will not slow this drive down.
“We anticipate that the pandemic will accelerate the pace of transition to a lower carbon economy and energy system, as countries seek to ‘build back better’ so that their economies will be more resilient in the future,” says Andreea Moyes, sustainability director at Air BP.
By all accounts SAF is here to stay.
This year looks like being the year when sustainable aviation fuel (SAF) production takes off. A dozen or so commercial-scale projects have been announced since the beginning of 2021, bringing a host of new names to aviation such as Fulcrum Bioenergy, LanzaTech, Neste, SkyNRG and World Energy.
Several of the traditional energy providers, such as BP and Shell, are piling in too.
SAF can be made from a variety of raw materials, called feedstocks, and several different technologies, dubbed pathways. SAF plants look identical in size and scale to traditional fuel refineries and cost the same, upwards of $500 million each.
Today, the predominant commercial SAF makers are Boston-based World Energy and Finland’s Neste. The former is converting its refinery in California to exclusively make SAF and renewable diesel by late 2023, says chief executive Gene Gebolys.
Working with an undisclosed industrial partner, World Energy will use its experience in California to replicate it in “strategic locations around the world” to make “lower-carbon fuels”.
Neste makes SAF from renewable waste materials at its plant near Helsinki and is investing heavily to boost its output, with plants slated to come on stream in Rotterdam and Singapore in 2023, says Sami Jauhiainen, vice-president, business development, renewable aviation.
At Fulcrum, municipal waste is the feedstock for its SAF. “The beauty of garbage as a feedstock is that people pay Fulcrum to take it away,” explains chief executive Jim Macias.
Macias says its first commercial-scale plant, in Nevada, will go on stream this year. Fulcrum has announced another in Chicago and the plan is to roll out SAF plants in Houston, Seattle, San Francisco, Los Angeles and New York. In February, a site was selected for its first UK plant and there are more in the planning stages in the UK, Japan and Australia.
SkyNRG was formed in 2010 with a mission to bring SAF to market and make it the “new global standard”. It has five “Direct Supply Lines” under development, consisting of local feedstock, the refinery and offtake partners. The first, in the Netherlands, will pump SAF by 2023.
In January, SkyNRG announced the FLITE consortium, a partnership with LanzaTech to make SAF from waste-based ethanol by 2024. A month later, a consortium of Schiphol Group, the Port of Amsterdam, KLM and SkyNRG unveiled SynKero. This start-up aims to develop an e-fuel plant in the Netherlands, to go live in 2027, using so-called “green” hydrogen made from water, renewable energy and CO2.
Meanwhile, traditional energy giants are also becoming more vocal. Shell will play a strong role as a buyer, distributor, producer and technologist in working towards the 2050 decarbonisation goals, says Anna Mascolo, global president of Shell Aviation. It has invested in Canadian firm Varennes Carbon Recycling, which will make low-carbon fuels from non-recyclable waste from 2023.
“BP and Qantas recently announced a strategic partnership to further advance their shared net zero ambitions,” says Andreea Moyes of Air BP. Qantas chief executive Alan Joyce believes SAF will play a crucial role in getting the industry to net zero by 2050. “With this deal we want to create a SAF industry in Australia,” he says.