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Fly Net Zero: Sustainable Aviation Fuels


Overview of the latest industry developments on the road to #FlyNetZero by 2050, few weeks ahead of IATA’s AGM, to be held in Istanbul, Türkiye.

IATA’s latest policy paper on SAF is now available, calling for stronger incentives to increase SAF deployment across the industry. Government policy has an instrumental role to play in the deployment of SAF and IATA encourages policies which are harmonized across countries and industries, while being technology and feedstock agnostic. Incentives should be used to accelerate SAF deployment. As SAF is in the early stages of market development, mandates should only be used if they are part of a broader strategy to increase the production of SAF and complemented with incentive programs that facilitate innovation, scale-up and unit cost reduction.

In the EU, under the European Green Deal a new law was agreed to cut aviation emissions by promoting SAF. The agreement marks an important and timely step necessary to the realization of the ambitious targets of the decarbonization roadmap to which the sector has committed. Some of the key elements of the agreement include:

Setting of mandates for minimum SAF uplift at EU airports of 2% by 2025, 6% by 2030 and 20% by 2035, up to a maximum of 70% by 2050. Of these amounts, 1.2% in 2030, and 5% in 2035 must be power to liquid (PtL) or E-Fuels, increasing to 35% by 2050.
A requirement for the Commission to report by 2024 on the feasibility of a Book and Claim (B&C) system for airlines to manage the supply of SAF in a flexible way across the EU.
A call for States to adhere to a single EU SAF mandate and avoid a patchwork of national SAF mandates.
See IATA’s statement for more information.

Elsewhere in Europe, Norwegian partnered with Norsk e-Fuel to build a full-scale sustainable fuel plant in Mosjoen. Under the agreement, the carrier aims for long-term offtake of the fuel and an equity stake in the company. Norwegian plans to secure 20% of its SAF demand to 2030 through the partnership. Wizz Air has signed a MoU with Spanish energy company Cepsa for the supply of sustainable aviation fuel from 2025, giving Wizz Air the opportunity to purchase SAF from Cepsa for the supply across the airline’s route network in Spain from 2025. Ryanair have announced a partnership with Neste Holland to power approximatively a third of its flights at Amsterdam Airport Schiphol (AMS) with a 40% SAF blend. Repsol and Ryanair have signed a strategic agreement to promote the use of renewable fuels in Spain and Portugal.

In Canada, Airbus Canada, Pratt & Whitney Canada, and SAF+ Consortium announced a new initiative to collaborate on next-generation SAF, supported by the Government of Quebec. Key areas of collaboration include SAF research and testing, including flight testing blends of up to 100% SAF on an Airbus A220 aircraft powered by Pratt & Whitney GTF™ engines. The project will also comprise feasibility studies for establishing local production facilities for power-to-liquid e-SAF in Quebec. Neste and Air Canada are expanding their collaboration with an additional supply of 2.5 million gallons (9.5 million liters or 7,500 tons) of SAF, used to power the airline’s flights from the San Francisco International Airport. Still in Canada, Raven SR and Cap Clean Energy have announced a collaboration on Canadian SAF and renewable diesel projects.

In the US, Delta will purchase up to 10 million gallons of SAF from Shell Aviation over a two-year period for use at its hub at Los Angeles International Airport. United Airlines has announced a $15 million investment in Svante, a Canadian company specializing in carbon capture and removal technology. Svante provides materials and technology as part of the value chain that has the potential to convert CO2 removed from the atmosphere and from industrial emission sources into SAF.  In the Pacific Northwest, Washington State University and Snohomish County have teamed up to develop a proposed research and development center for sustainable aviation fuels. The $6.5 million SAF Applied Research and Development Center will offer fuel testing, fuel finishing as well as a fuel repository. For the first time, companies including Bank of America, Boom Supersonic, Boston Consulting Group, JPMorgan Chase & Co., Meta and clean energy nonprofit RMI are joining together through the Sustainable Aviation Buyers Alliance (SABA) to purchase SAF certificates at scale for nearly 850,000 gallons of high-integrity SAF produced by World Energy and helping fuel JetBlue flights, reducing an estimated 8,500 tons of CO2 on a lifecycle basis. This practice will strengthen the demand signal aviation customers are sending to the SAF market.

In Mexico, low-cost airline Viva Aerobus has agreed to purchase 1m liters of SAF from Neste. The fuel will be used on Viva Aerobus flights from Los Angeles to Guadalajara, Mexico City and Monterrey.

In Asia, Cathay Pacific announced a collaboration with State Power Investment Corporation (SPIC) to develop SAF supply chain in China through four new SAF plants using a pathway similar to power-to-liquids. The plants are expected to be commissioned between 2024 and 2026, and each will have the capacity to produce 50,000 to 100,000 tonnes of SAF annually. In Japan, All Nippon Airways (ANA), has for the first time agreed to use SAF that was blended in Japan under a public-private initiative led by the Civil Aviation Bureau of the Ministry of Land, Infrastructure, Transport and Tourism (MLIT). ANA will procure the blended SAF from ITOCHU Corporation, and will use the fuel on ANA’s international and domestic flights from Haneda and Narita airport. Earlier this year, Honeywell and Oriental Energy Company Ltd. jointly announced that a SAF production facility with an annual output capacity of 1 million tonnes will be built in Maoming, Guangdong Province in China.
Single Use Plastics Aéroports de Montreal‘ has announced a new policy to phase out certain single-use plastics, such as utensils, food containers, cups and bags. These plastics will no longer be available in concession areas and VIP lounges at Montréal-Trudeau International Airport. 

Air India announced having minimized single-use plastic usage by approximately 80% on board all flights across its worldwide network. The reduction has been achieved in an ongoing effort led by a team of in-house experts and supported by catering partners and multiple vendors, with the aim of continually minimizing the carrier’s environmental impact.
Electric planes Sweden’s Northvolt revealed a development program for aviation battery systems. Northvolt’s subsidiary Cuberg unveiled a new program dedicated to developing high-performance battery systems that will enable safe, sustainable electric flight. Cuberg will spearhead the program through the design and build of system solutions for the aviation industry based on its innovative lithium metal battery technology.
Airports Air India has signed an agreement with KSU Aviation to launch TaxiBot operations at Delhi and Bengaluru airports for its Airbus A320 Family of aircraft. The strategic partnership is aligned with Air India’s commitment to reducing its carbon footprint, as the adoption of TaxiBots envisages a potential saving of ~15,000 tonnes in fuel consumption over three years.

Focus on… Repsol: We spoke with Oliver Fernández García, International Aviation Director at Repsol, to discuss SAF and decarbonization of the aviation industry

How is Repsol helping airlines tackle the climate challenge? Who are your clients?

The aviation industry has set ambitious reduction targets and is moving decisively towards decarbonization. Our aim is to support the sector in this endeavor, supplying them with the renewable fuels they need to make their ambitions a reality. Our investments are focused on stepping up our production of both SAF and synthetic SAF (e-jet) as fast as possible to meet the demand of the sector. In recent years, we have been supplying SAF, produced at our industrial complexes, to different airlines like Iberia, Vueling, and Air Europa, for both national and international flights, as well as to the Spanish air force. We have signed collaboration agreements with several companies, including Iberia, Vueling, and Gestair, Spain’s largest executive aviation services company, to support them in decarbonizing their operations. Most recently, we have signed an off-take agreement with Ryanair to supply 15% of their need for SAF between 2025 and 2030, up to a total of 155,000 tons, and we are working to sign other commercial supply agreements. Finally, we should not forget ground operations at airports that also need to reduce emissions and where our renewable fuels are also a great solution.

What is your main source of feedstock? Are you looking into expanding your feedstock sources (e-fuels, etc.)?

Over the last couple of years, we have produced several batches of SAF at our industrial complexes using biomass and waste from the agrifood industry. In the second half of 2023, we will inaugurate the first plant in Spain dedicated exclusively to the production of advanced biofuels at our Cartagena refinery. These fuels will primarily be produced with used cooking oil, but with flexibility in the system to incorporate other types of residues. This facility, in which Repsol is investing more than 200 million euros, will supply 250,000 tons a year of advanced biofuels, which can be used in current airplanes, ships, trucks, or cars, and their use will make it possible to avoid the emission of 900,000 tonnes of CO2 per year.

Also, the company is preparing the construction of a synthetic fuels plant in Bilbao, in collaboration with Aramco, that will be able to produce e-jet using renewable hydrogen and captured CO2 as raw materials. With an initial investment of more than 100 million euros, it will be one of the largest of its kind when it comes into operation in 2025, and the plan is to reach industrial scale before the end of the decade. 
What are the main challenges to producing SAF? Is producing SAF in Europe harder than in the US? 

SAF is the future, but also the present. We know very well how to produce it and have a clear roadmap. But to step up production in the fastest way possible, we need policies that create clear incentives for investment by promoting all decarbonization solutions on a level playing field. It’s not only a question of investing more public money, but also about making it easier for more private money to be invested with simpler regulation and openness to different technological solutions. 
Of course, we welcome recent European initiatives that have considerably raised the targets for the aviation sector in the coming decades and the Green Deal Industrial Plan in response to the American Inflation Reduction Act. Still, in the European Union a complex system of rules and regulations has been built up that does not facilitate rapid progress in the energy transition. In many cases, regulations overlap each other and are often accompanied by restrictions and even prohibitions of technologies and solutions that could help us reduce emissions faster. We, therefore, think, the European authorities should look even more to the United States that has a much simpler system where support is provided in the form of tax breaks or incentives available to all those interested in investing in decarbonization solutions. 
National and local initiatives, for example, in the UK, Germany, or Sweden to finance projects and favor investments in SAF or the one presented recently by the airports in Milan in Italy to support the airlines that use SAF economically are all steps in the right direction.  
How do you see the landscape evolve all the way to 2030? 

Many airlines have already started to use SAF or are looking into it, but we expect this to really take off from 2025 when the requirements to blend SAF in the fuels become binding and start increasing gradually. From our contacts with airlines, we sense that many will be wanting to move faster than the roadmap set out by institutions, and we are gearing up to help cover that demand. When our new plant in Cartagena goes on stream later this year, its production capacity alone will be able to absorb the entire Spanish demand until 2030. We will, however, keep scaling up our production in the second half of the decade to help cover the needs after 2030 when it also becomes a requirement to blend in a percentage of e-jet. In general, our funnel of renewable fuel projects for aviation and other sectors of transport is very rich, and we are considering different routes to accompany the airlines in their demanding goal of decarbonization of the sector. We need to keep our minds open and keep all possible technological solutions on the table, committing to those that contribute to reaching our goals in the fastest and most efficient way possible. 

Oliver Fernández García is an Industrial Engineer, Refining, Gas & Marketing postgraduate, PDD at IESE Business School, and different programs at IE Business School (M&A, forensic analysis etc.). He has 20+ year Oil&Gas experience in Repsol. Oliver has been working abroad 13+ years in Italy (CEO Repsol Italia Spa – wholesales, lubricants and retail sites) & Mexico (start-up, retail business development, President of Board of JV) and also in Spain (Strategic Planning, Wholesales, Petrol stations, Lubricants, Asphalts and Specialties).


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