According to World Wildlife Fund, air travel is “currently the most carbon-intensive activity an individual can make.” The environmental footprint of aviation is considerable, and making it sustainable with rising costs could actually work. Customers are willing to pay more with the uptake, according to the director-general of the International Air Transport Association.
The main challenge relates to volume rather than airlines’ desire to use it according to the General Director. Interestingly people are willing to pay as well. “I think quantity is the main issue at the moment,” Willie Walsh, who was speaking to “Squawk Box Europe” on Friday morning, said. “We used about 100 million liters of sustainable aviation fuel in 2021 — that’s a very small amount compared to the total fuel required for the industry.”
Looking ahead, Walsh said airlines had ordered 14 billion liters of SAF. “I think that addresses the issue of whether airlines will buy the product,” he said. Walsh noted this was happening even though the price of SAF was “about two and a half times the price of jet kerosene. When you factor in the cost of carbon, you’re looking at maybe … twice the price of kerosene.” While there appears to be some demand for SAF, meeting it is another question entirely and its road to dominance in the sector looks to be a long one.
Production of aviation fuel
It is known that with “appropriate government policy support,” IATA says it expects to see SAF production hit 7.9 billion liters by 2025, which would meet just 2% of the overall fuel requirement. By the middle of the century, the trade association says production would jump to 449 billion liters or 65% of the sector’s needs.
Though the European Union Aviation Safety Agency says there’s “not a single internationally agreed definition” of sustainable aviation fuel, the overarching idea is that it can be used to reduce an aircraft’s emissions. Then there are major concerns in some quarters that increased uptake of SAF could, among other things, result in significant deforestation and create a squeeze on crops crucial to the production of food. Walsh stated it was “critical” that the industry did not use feedstocks that compete with land use or food production. “All of the regulations in relation to the … longer-term development of sustainable aviation fuels will guarantee that that’s not the case.” Looking ahead, Walsh said airlines had ordered 14 billion liters of SAF. “I think that addresses the issue of whether airlines will buy the product,” he said.
Credits- CNBC