Ensuring Fair Access to Sustainable Aviation Fuel (SAF) for Business Aviation Companies Across Diverse Regions

Sustainable aviation fuels (SAF) are low-carbon alternatives to conventional jet fuel that can reduce greenhouse gas (GHG) emissions from aviation by up to 80%. SAF is widely recognized as a key solution for the decarbonization of the aviation sector, which accounts for about 2.5% of global CO2 emissions. However, the production and availability of SAF are currently limited and unevenly distributed across different regions, posing a challenge for business aviation companies that want to adopt SAF and reduce their environmental impact.

Business aviation, which includes all non-scheduled civil flights, such as corporate, charter, and private flights, represents about 2% of global aviation emissions. Business aviation operators are often at the forefront of innovation and sustainability, and have shown a strong interest and commitment to use SAF as part of their environmental strategy. However, they face several barriers to access SAF, such as high costs, low supply, regulatory uncertainty, and lack of infrastructure and incentives. Let’s explore how business aviation companies can overcome these barriers and ensure equitable access to SAF across different regions and benefits of SAF for business aviation and the environment, and the initiatives and partnerships that are supporting the development and deployment of SAF.

Current Projected Supply & Demand of SAF

According to the International Energy Agency (IEA), the global production capacity of SAF was about 50 million liters in 2020, which is less than 0.1% of total jet fuel demand. The IEA projects that SAF production could reach 7 billion liters by 2025, and 285 billion liters by 2050, under a sustainable development scenario. However, this would still fall short of the projected jet fuel demand of 450 billion liters in 2050. The demand for SAF is driven by several factors, such as the environmental goals of the aviation industry, the regulatory requirements and incentives of governments, and the preferences and expectations of customers and stakeholders. The International Civil Aviation Organization (ICAO), the global body that sets standards and policies for aviation, has adopted a goal to achieve carbon-neutral growth from 2020 and a 50% reduction in net CO2 emissions by 2050, compared to 2005 levels. To achieve this goal, ICAO has established a framework of measures, including a market-based mechanism called the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), which requires airlines to offset their emissions above a baseline level by purchasing carbon credits from approved projects.

SAF is one of the eligible sources of carbon credits under CORSIA, and can also help airlines reduce their emissions and fuel costs. SAF can be blended with conventional jet fuel up to a certain percentage, depending on the type and specification of the fuel, without requiring any modification to the aircraft or engine. SAF can also improve the fuel efficiency and performance of the aircraft, as it has a higher energy density and lower freezing point than conventional jet fuel.

The demand for SAF is also influenced by the policies and incentives of governments, which vary across different regions and countries. Some governments have introduced mandates, targets, or quotas for SAF production or use, such as the European Union, which has proposed a 5% blending requirement for SAF by 2030, and a 63% blending requirement by 2050, as part of its ReFuelEU Aviation initiative. Other governments have provided financial or fiscal support for SAF, such as tax credits, subsidies, grants, or loans, to stimulate the development and deployment of SAF, such as the United States, which has recently advanced a SAF blender’s tax credit of $1.25 to $1.75 per gallon, depending on the GHG reduction potential of the fuel.

Existing and Proposed Policies & Incentives to Support SAF Production and Use

As mentioned above, the policies and incentives to support SAF production and use vary across different regions and countries, depending on their political, economic, and environmental priorities and circumstances. Such as;

Opportunities for Accessing SAF Fuel In The EU

The EU has adopted the Renewable Energy Directive (RED) and the Fuel Quality Directive (FQD) to promote the use of renewable fuels in transport, including SAF. The RED sets a target of 14% renewable energy in transport by 2030, and the FQD requires a 6% reduction in the carbon intensity of transport fuels by 2020. The EU also supports SAF research and innovation through the Clean Sky and Horizon 2020 programs, and provides incentives for SAF production and consumption through the Emissions Trading System (ETS) and the Alternative Fuels Infrastructure Directive (AFID).

Opportunities for Accessing SAF Fuel In The USA

The USA has established the Renewable Fuel Standard (RFS) to mandate the blending of renewable fuels in transportation, including SAF. The RFS sets annual volume requirements for different categories of renewable fuels, such as conventional, advanced, cellulosic, and biomass-based diesel. The RFS also creates a market for renewable identification numbers (RINs), which are credits that can be traded or sold by renewable fuel producers and blenders. The USA also supports SAF development and deployment through the Department of Energy (DOE), the Federal Aviation Administration (FAA), and the Commercial Aviation Alternative Fuels Initiative (CAAFI). Additionally, the Sustainable Aviation Fuel Act of 2021 proposes to establish a low carbon fuel standard for aviation fuels and a blender’s tax credit for SAF.

Opportunities for Accessing SAF Fuel In The Asia

The Asian region has a diverse range of policies and initiatives for SAF, depending on the country. For example, China has set a target of 12% renewable energy in transport by 2020, and has invested in SAF research and demonstration projects through the National Natural Science Foundation of China (NSFC) and the National Key Research and Development Program (NKRD). China also has a carbon trading scheme that covers the aviation sector and provides incentives for SAF use. India has launched the National Biofuel Policy of 2018, which aims to increase the blending of biofuels in transport, including SAF. India also has a carbon tax on aviation fuel and supports SAF research and development through the Ministry of Petroleum and Natural Gas (MoPNG) and the Council of Scientific and Industrial Research (CSIR). Japan has adopted the Basic Act on Energy Policy, which sets a goal of 10% renewable energy in transport by 2030, and has established the Green Innovation Fund to support SAF projects. Japan also has a voluntary carbon offset scheme for aviation and participates in the International Civil Aviation Organization (ICAO) Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).

SAF Best Practices to Sustainable Aviation Fuel (SAF) for Business Aviation Companies

Some common themes and best practices can be identified, based on the experience and recommendations of the aviation industry and experts.

One of the key policy instruments to support SAF is a long-term, stable, and predictable regulatory framework that provides certainty and clarity for the SAF market. This includes setting clear and consistent definitions, standards, and criteria for SAF, such as the feedstocks, pathways, and technologies that are eligible and sustainable, and the methods and metrics to measure and verify the GHG reduction potential and lifecycle emissions of SAF. This also includes harmonizing and aligning the SAF policies and regulations across different regions and countries, to avoid fragmentation, duplication, or contradiction, and to facilitate the trade and transport of SAF.

Another key policy instrument to support SAF is a balanced and flexible mix of incentives that address the different barriers and challenges for SAF production and use. This includes providing financial or fiscal incentives, such as tax credits, subsidies, grants, or loans, to reduce the cost gap between SAF and conventional jet fuel, and to stimulate the investment and innovation in SAF production and infrastructure. This also includes providing non-financial or non-fiscal incentives, such as mandates, targets, or quotas, to create and sustain the demand and supply of SAF, and to ensure the fair and equitable distribution and allocation of SAF across different regions and operators.

A third key policy instrument to support SAF is a collaborative and inclusive approach that involves and engages all the relevant stakeholders and actors in the SAF value chain, from the feedstock producers, to the fuel suppliers, to the aircraft operators, to the customers and regulators. This includes establishing and strengthening the dialogue and coordination among the different stakeholders and actors, to share information, knowledge, and best practices, and to identify and address the common challenges and opportunities for SAF. This also includes creating and supporting the initiatives and partnerships that promote and facilitate the development and deployment of SAF, such as the Sustainable Aviation Fuel Coalition (SAF Coalition), the Sustainable Aviation Buyers Alliance (SABA), and the Council on Sustainable Aviation Fuels Accountability (CoSAFA).

Promoting equitable access to sustainable aviation fuel (SAF) is crucial for the industry’s sustainability goals. Just Aviation advocates for fair distribution across diverse regions, providing expert insights into the challenges and opportunities. From supply chain logistics to regulatory frameworks, we offer strategies to facilitate widespread adoption while addressing regional disparities. Partner with Just Aviation to drive positive change and foster a more sustainable future for business aviation worldwide.