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Time for the oil majors to invest in SAF production
The decision by the 14 members of the Association of Asia Pacific Airlines (AAPA) to have 5% of their fuel needs met by sustainable aviation fuel (SAF) by 2030 is certainly brave. Read More »
But many observers and analysts consider it is a pipedream, given the target is only six years away and current worldwide SAF availability is a mere 1% of airline requirements. AAPA director general, Subhas Menon, concedes it is a collective “aspirational target” and the reason it has been set is to “wake the oil majors from their slumber”.
They will be key players in SAF production. But they say they can’t start producing SAF unless demand is there, a puzzling position when airlines are buying every single litre of SAF being produced, despite it costing five to seven times the price of normal jet fuel.
But the seeds of SAF production have been planted in Asia. Neste, the world’s largest producer of renewable diesel and sustainable aviation fuels, has its Asian hub in Singapore and is producing 2.6 million tons of SAF a year. Other projects are in the pipeline. Numerous collaborations have been announced between airlines, regional governments and investors.
The U.S. government, via the Department of Transportation (DoT) and the Federal Aviation Administration (FAA), is partnering with Boeing to support APEC (Asia-Pacific Economic Cooperation) efforts to develop SAF supply, including analyzing new pathways to optimize SAF production.
Additionally, China is predicted to be a major supplier of SAF if its government puts its weight behind its production infrastructure. The Civil Aviation Administration of China has recently mandated the use of 50,000 tons of SAF in China by 2025. But it is only approximately equivalent to 0.1% of the total jet fuel used in the country in 2019 - or the fuel consumption of a thousand flights between London Heathrow and Shanghai Pudong.
At present, this is a small step. However, more ambitious targets are likely to be established in the Chinese market. The problem is it takes years to set up a SAF refinery. For AAPA airlines aiming to reduce their emissions, the SAF supply they need to meet their 2030 target is entirely dependent on sufficient SAF being produced – and that is out of their control.
TOM BALLANTYNE
Associate editor and chief correspondent
Orient Aviation Media Group
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October 2nd 2024 07:46am