UK industry is supporting SAF, but needs to speed up

opinion

by Alasdair Whyte

April 19, 2023

Sustainable Aviation Fuel (SAF) dominated a lot of the discussions at the excellent Sustainable Skies Summit that took place in Farnborough this week. An RAF Voyager aircraft powered by 43% SAF even flew over.

UK industry group Sustainable Aviation used the event to publish its latest Net Zero Carbon Road-Map. Sustainable Aviation sees SAF as key to net zero aviation by 2050 – in fact, it is relying on SAF for 39% of all carbon savings. The Road-Map, which uses independent research from consultancy ICF, says that there is the potential for SAF to provide 75% of UK jet fuel needs by 2050.

On the same day, the UK Department for Transport published an independent reportlooking at how the UK can develop a SAF industry. Written by energy veteran Philip New, the report agrees with much of what Sustainable Aviation wants. But it also highlights how complicated the role of governments are in supporting SAF.

“The US and Europe are surging forwards in the race to create new industries in sustainable aviation fuels and technology. The UK has all the natural advantages to be able to join them – but we need to move quickly,” said Matthew Gorman, chair of Sustainable Aviation, and carbon strategy director, London Heathrow Airport, in the Road-Map.

The UK government says that it will have a SAF mandate in place from 2025. In March it published its second mandate consultation which is open for comments. The UK will mandate that at least 10% of jet fuel in 2030 will be SAF, but is still in discussion about future targets and details, including what proportion can be SAF from the HEFA or waste fats pathway. Sustainable Aviation and New’s report are both focused on second and third generation SAF.

“I have been in this space for 15 years and it was a lot different when I first came in. Now you have all of the pieces of the puzzle. You have technology being deployed, programmes being launched, you have customers who are now saying they want this fuel and you have policy that is beginning to fall into place,” said Jimmy Samartzis, CEO, LanzaJet at the Summit. “The financing community has a part to play, they need to show up and help to finance the billions of dollars required to build the infrastructure needed.”

LanzaJet is working on its innovative Project DRAGON in Wales which plans to capture steel mill gases for SAF and has received £25m ($31m) from the UK Advanced Fuels Fund.

At the summit, Ingrid Holmes, executive director, Green Finance Institute – an organisation created by the UK government and the City of London – highlighted the three key concerns investors have about SAF projects. She said these are: price uncertainty; concerns about feedstock supply; and technology risk.

Sustainable Aviation also says pricing is a key issue. “An agreed mandate for SAF as soon as possible and a price support mechanism – building on Philip New’s independent report for the government – are key policy areas where we can act now to gain a share of the huge prize of making Britain the natural home of net zero aviation,” said Gorman.

New’s report looks at creating both a government run price floor scheme and a private contract. He favours a private sector price insurance supported by industry. He warns that a government driven price-stability mechanism could take between two and four years of legislation.

He ends the report saying the industry has three key requests from the UK government: deciding mandates and other support faster; coordination between departments (this is key when different industries will end up fighting for feedstock like municipal solid waste which can be used to generate power); and confidence that the UK government will stay the course.

The last is a challenge for all governments. The UK government is clearly keen to build a UK SAF industry. In December it granted £82m to five projects from its £165m advance fuel fund (which is now open for new applications). It also has a £400m agreement with Bill Gates’ Breakthrough Energy Catalyst.

Boris Johnson pledged support for the UK’s JetZero project as he opened the Farnborough Airshow last year. But things change. That was six months/three prime ministers ago.