+ COMMENT: Sustainable Aviation Fuel (SAF)

Over 230 delegates from the UK, Europe and beyond gathered at The Royal Garden Hotel, Kensington, for the debut (Sustainable Aviation Fuel (SAF) Investor Conference during 27-28 February. It has to be the future of air travel.

Sessions on SAF forecasting production and demand, book and claim, scaling up and offtake agreements were complemented by discussions on E-fuels, municipal solid waste and even excrement as a potential source of SAF.

Shashank Nigam, SimpliFlying, kicked off proceedings highlighting the importance of SAF since 42,000 aircraft will be flying by 2042, up from 29,000 today. We will need SAF to fly and be truly net zero, he emphasised. Interestingly funding for SAF stands at circa $760m whereas the funding for the new eVTOLs is more than twice as much as the rest of sustainable technologies combined – at $5.6bn.

The ramp up of SAF is much lower than it should be however, according to PwC’s Jan Wille. Referencing the consultancy’s “Feedstock to flight” study he said, a massive 46 million tonnes of SAF are needed by 2030, compared with just 0.5 million tonnes due to be in production by 2025. Today 11 refineries exist and a further 100 will be needed within six to seven years.

The good news is, the willingness is there. From innovators to investors, stakeholders across the industry are pledging their support to scale SAF supply and explore alternative pathways to decarbonising aviation.

The cost of SAF (both to produce and purchase), as well as the availability and scalability of sustainable feedstocks remain key challenges. Greater investment is also needed to develop new technologies and more effective communication will help educate the wider public about the benefits and availability of SAF, although many of the OEMs and operators argued the customer is already on board. They want SAF and they are willing to pay, they just don’t know how to go about getting it.

In a discussion on offtake agreements, Wizz Air’s Yvonne Moynihan said there’s currently a tailor-made approach to these agreements and they need to be standardised to create fair competition. Dana Kaplinksi of Delta Air Lines agreed, saying no two offtake agreements have the same pricing structure. However, offtake agreements are key to understanding how much demand there is from commercial carriers for SAF. Pricing is still uncertain, but this will change in the next couple of years.

Similarly, book and claim has an integral role to play in meeting net zero targets, as Kennedy Ricci from 4Air underlined it is impossible to have SAF available everywhere, so it makes sense to adopt book and claim, especially for business aviation, where the majority of customers are flying in and out of smaller, regional airports. It offers a pathway to unlocking the potential of SAF on a commercial scale. It is however not recognised so far by the UK.

A panel that covered e-fuels, saw CirculAIRity's Alex Chikhani, declare that when it comes to investment we need to put the planet first, not the commercial model. Andrew Symes of OXCCU agreed, adding that processes will get easier and costs will come down.

Written by the Emerald Media team who attended the conference on behalf of TNU.

www.emeraldmedia.co.uk

www.safinvestor.com

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READERS' COMMENT

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Chris Pocock, UK

For a much less optimistic view of SAF, see the Royal Society report from March last year. I summarised it at: https://www.ainonline.com/aviation-news/air-transport/2023-06-15/sustainable-aviation-fuels-numbers-dont-yet-add