FRIDAY, February 23, 2024

Asia’s airlines look to sustainable aviation fuel

Asia’s airlines look to sustainable aviation fuel

The Asia-Pacific region produces and uses relatively low amounts of sustainable aviation fuel (SAF), but efforts to promote sustainability in the aviation industry in this region are catching up with Europe and North America

With environmental conservation becoming increasingly important to the global aviation industry, the region is currently working on reducing its overall carbon dioxide emissions.

Asian airlines are preparing to expand their biofuel refineries in Singapore as much as possible. Neste, a Finnish bio-energy company, is expanding its biofuel refinery in Singapore worth US$1.75 million and is starting the production of sustainable aviation fuel (SAF), which is biofuel produced from cooking oil and animal fats. Meanwhile, market leaders in Europe have already started producing SAF, with production capacity in Singapore reaching 1 million tons per year.

SAF is said to emit less carbon dioxide than conventional aviation fuels by 80% throughout its life cycle, from raw material production and refining to energy combustion.

Data from the International Air Transport Association (IATA) shows that global SAF production in 2022 exceeded 300 million litres.

Sami Jauhiainen of Neste's Renewable Aviation business unit, stated in an interview with Nikkei Asia that the company has sourced large amounts of waste and by-products from across the Asia-Pacific region.

The aviation industry, currently one of the highest emitters of carbon dioxide globally, is facing the need for rapid operational changes.

Kohei Yoshikawa, Head of Carbon Reduction at All Nippon Airways (ANA), expressed concern, stating, “If we fail to comply with global environmental regulations, we may not be able to use planes in the future."

In October 2020, IATA adopted a resolution to achieve zero carbon emissions by 2050. The International Civil Aviation Organisation (ICAO), an inter-governmental aviation organisation, also adjusted its target to achieve the same goal in the following year. By combining the results together, IATA is confident that using SAF can help the aviation industry reach 65% of its target.

Philip Goh, vice president of IATA's Asia-Pacific regional office, stressed that governments need to play a role as the Asia-Pacific region produces and uses relatively low amounts of SAF, and efforts to promote sustainability in the aviation industry in this region are catching up to Europe and North America.

In this regard, both Europe and the US have taken the lead in setting sustainability targets. In 2020, the U.S. approved a resolution to ensure that the supply of SAF meets 100% of demand by 2033.

Meanwhile, the European Union (EU) has implemented measures requiring airports in Europe to use a minimum of 34% SAF by 2030 and 70% by 2050.

Several major airlines have their own objectives, such as American Airlines, Air France, and several other airlines. They aim to use sustainable aviation fuel (SAF) as a replacement for conventional jet fuel for 10% of their general aircraft operations by 2030. Low cost carrier Ryanair has set a target for the company's flights to utilise SAF for 12.5% by the year 2050.

However, there are numerous challenges to overcome before SAF becomes widely adopted. Currently, it is estimated that global SAF production may account for only 0.1-0.15% of the aviation fuel demand. There are only a few SAF producers, including Neste and LanzaJet, capable of producing large quantities of SAF. This situation leads airlines to seek additional sources of energy.

Although it is projected that carbon neutrality could be achieved by 2050, it presents a challenge in terms of SAF production. It is estimated that the production of SAF would reach approximately 499 billion litres per year. However, one obstacle is that SAF is more expensive than conventional aviation fuel, costing approximately 2-5 times more.

Yasunori Kikuchi from the Institute of Future Initiatives at the University of Tokyo said, “If the supply chain of SAF can be developed, prices will decrease, but not immediately. We need to discuss who should bear the additional costs between airlines and passengers. If aviation is a fundamental structure for society, the government should step in and provide support.”