Cleared for takeoff: How sustainable aviation fuels can put the industry on course for net zero

SAFs take flight

SAFs have the potential to help decarbonise the aviation industry because they’re made from feedstocks whose carbon comes from the atmosphere, which offsets the emissions created when SAFs are burned in plane engines. What makes SAFs so attractive is that they’re drop-in fuels which can be blended with traditional jet fuel and used with existing, unmodified airport infrastructure, engines, and planes. To start decarbonising sooner rather than later, then, the aviation industry is looking not at electrification, but the widespread adoption of SAFs.

The transition to SAFs has already begun. For example, Boeing’s new 737 Max aircraft can already operate on a 50/50 blend of SAF and traditional jet fuel. Boeing views SAFs as having the largest potential contribution to decarbonisation, and has pledged that all of the new planes it delivers will be certified to run on 100% SAF by 2030. Indeed, most airlines have already announced targets for their SAF usage, while many have even signed off-take agreements with SAF producers. And the transition is set to accelerate thanks to the International Air Transport Association’s (IATA) Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), which has set ambitious targets governing high SAF penetration rates over the next few years. In fact, SAF is set to account for over 6% of global jet fuel by 2030¹.

Although SAFs represent a promising solution, they still account for less than 1% of global jet fuel. And if SAF is to become the new standard, there is much work to be done. For instance, although existing planes don’t need to be modified to run on SAFs blended with high ratios of traditional jet fuel, seals that have been exposed to fossil fuels for prolonged periods before being exposed to high percentages of SAF can develop leaks, while engine and fuel system components may need to be inspected and potentially replaced or modified to ensure compatibility and, ultimately, aircraft safety. In short: we need much more research and development before the aviation industry will be ready to use SAFs as a primary fuel. One of the purposes of Boeing’s ecoDemonstrator programme is to raise awareness of, and encourage investment in, the technologies we need to scale up SAF usage.

Read also: The long haul to zero emissions aviation

The plant-power promise

There are also different varieties of SAF, some of which are better than others.

Pure biofuel SAFs, for example, are made by growing and harvesting crops such as soybeans, sugarcane, or algae; extracting the oil; and refining it into a usable fuel. These pure biofuel SAFs are already commercially available, but their production must increase to around 450 billion litres a year by 2050 if the aviation industry is to hit its emissions targets. Neste, the largest manufacturer in the world today, produced just 125 million litres of SAF last year. Cost is also a barrier: biofuel SAFs are currently three to five times more expensive than traditional jet fuel.

Neste is investing EUR 1.9 billion to expand and adapt its Rotterdam biodiesel refinery, a promising development that will increase its global production capacity to around 2.75 billion litres annually. And as production continues to ramp up, economies of scale should gradually help bring the cost of biofuel SAFs closer to that of traditional jet fuel. Meanwhile, the third largest airport in Europe, Schiphol in Amsterdam, is encouraging the use of SAFs by making them available to all aircraft and providing a financial incentive to help bridge the price gap between traditional jet fuels and SAFs.

Despite these developments, however, it’s likely that at least some of the cost of switching to SAFs will have to be borne by passengers. Jonathan Wood, Vice President, Renewable Aviation Europe at Neste, says, “We’re talking a few dollars or euros per passenger for 2–5% SAF usage, which is where we need to start, before gradually ramping up over time.”

While pure biofuel SAFs have the potential to help decarbonise the aviation industry, environmentalists have other concerns. For instance, growing biofuel crops requires a lot of land. And with countries like Brazil already facing land-use change and deforestation challenges, the environmental damage caused by growing more crops would cancel out some of the benefits of pure biofuel SAFs. Paul Peeters, Professor at Breda University’s Centre for Sustainable Tourism and Transport, notes, “Because of this land use, the effect on the climate is not reduced by 100%, but – if everything is perfect – 80%.”

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A waste-based wonder?

In contrast to pure biofuel SAFs, waste-based biofuel SAFs bypass the environmental damage that comes from growing crops as they use materials that would otherwise be discarded. Waste-based SAFs are made from feedstocks such as used cooking oil, animal fats, and agricultural waste, which are collected, processed, and refined into a usable fuel. This also helps reduce the amount of waste that ends up in landfills, which have significant environmental impacts of their own.

However, waste-based SAFs have significant drawbacks. The feedstocks used for their production are limited in quantity and availability, and the need to remove impurities and contaminants before converting them into SAFs often results in more complex and expensive processes than those used to create pure biofuel SAFs.

Waste-based SAFs, then, will only ever be able to fulfil some of the aviation industry’s fuel needs. Even so, they remain a promising area of research and development: with their lower environmental impact, waste-based fuels could be used alongside pure biofuel SAFs to accelerate the industry’s transition to a low-emissions future.

E-fuels: from air to engine

Another promising variety of SAF is synthetic electrofuel, also known as e-fuel. E-fuels are made by extracting carbon from the atmosphere and then combining it with green hydrogen, which is produced from clean energy sources such as renewables or nuclear. The resulting mixture is converted into a liquid fuel, which can be used to power aircraft.

E-fuels make particularly sustainable aviation fuels because the emissions released by burning them are offset by the carbon dioxide extracted from the atmosphere during production. In other words: e-fuels achieve the ultimate goal of net zero by closing the carbon cycle.

However, synthetic e-fuels are years away from commercial viability. The process of producing e-fuels is still in its infancy and requires significant investment in infrastructure, research, and development before it can be widely adopted. Additionally, the cost of producing e-fuels remains prohibitively high, which will likely hinder the technology’s adoption in the short term.

Despite these challenges, many believe that e-fuels hold great promise for the future of aviation and could play a critical role in helping the industry achieve net-zero emissions. In the meantime, researchers and industry experts are working to refine the production process and find ways to make e-fuels more affordable and accessible.

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Charting a greener flight path

Although a net-zero aviation industry remains a long way off, the growing pressure to find and implement solutions is already driving significant innovation and investment in SAFs.

Boeing has already made significant strides in this direction by conducting some of the first blended-fuel flights, along with the first commercial flight powered by 100% SAF using a Boeing 777 freighter. Meanwhile, Virgin Atlantic has received funding from the British government to carry out the first 100% SAF-powered transatlantic flight from London to New York.

Of course, if this hard-to-abate sector is to achieve net zero, it must continue to explore other potential decarbonisation methods, including fleet modernisation, operational efficiencies, and new aircraft designs such as narrower bodies and innovative weight-saving materials. And in the long term, entirely new propulsion methods like green hydrogen fuel may finally make net-zero flight a reality.

For the aviation industry, this isn’t just about environmental sustainability. In the long term, reducing its emissions will also help preserve the sector’s commercial sustainability. For as people increasingly choose products and services that offer a low environmental impact as well as value for money, the aviation industry must do things differently if it is to remain an attractive way to travel. As Neste’s Jonathan Wood points out, “If we’re not careful, aviation will be put in the same box as tobacco. We don’t want to be there. Aviation can be a real force for good. And we’ve got to find a way to do it in a more socially acceptable way.”

¹ Lombard Odier projections

This document is issued by Bank Lombard Odier & Co Ltd or an entity of the Group (hereinafter “Lombard Odier”). It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a document. This document was not prepared by the Financial Research Department of Lombard Odier.

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