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Aviation is one of the most carbon-intensive sectors in the world and one of the most difficult to decarbonize. Today, however, a new framework has been developed by a wide range of industry partners to reduce emissions by boosting the use of sustainable aviation fuel (SAF) through a certificate system.
Developed as part of the Clean Skies for Tomorrow (CST) initiative of the World Economic Forum, the Sustainable Aviation Fuel Certificate (SAFc) system is a new accounting tool that will allow the traveler to claim SAF emission reductions if they cover the higher fuel cost. . The system operates under standard “reservation and complaint” processes, which will deliver the actual SAF to the airport closest to its production facility.
“Clean Skies for Tomorrow was founded to accelerate the deployment of SAF and aviation’s net zero path,” said Pedro Gomez, Head of Shaping the Future of Mobility, World Economic Forum. “Consumer demand for sustainable air travel is a critical part of this path and SAFc has been uniquely designed to enable a clear and consistent demand signal from the market. “
The new certificate mechanism is initially designed for companies with a significant air transport and freight footprint, but can be extended in due course.
Why a sustainable aviation fuel?
SAFc is an important step on the road to carbon neutral flight. There are benefits for both airlines and customers as SAF is the most promising way to reduce the industry’s carbon footprint in the short term.
Because jet fuel contains a lot of energy for its weight, it’s hard to find workable options for long-haul commercial flights. Hybrid electric and hydrogen planes might help someday, but their development and large-scale deployment could take 10 to 20 years, and the technology will likely be limited to smaller, shorter-range planes, even in the long term.
In contrast, SAF – made from biogenic feedstocks such as used cooking oil, agricultural residues and municipal waste – is available now and is compatible with existing aircraft and refueling infrastructure.
With existing technologies, SAF can reduce GHG emissions by up to 80% based on life cycle emissions. However, next-generation SAF technologies, such as power-to-liquid, which use recycled CO2 and carbon capture technologies, are already under development and could offer an overall 100% emission reduction if the ‘we use a completely carbon-free supply chain.
The challenge is that the SAF is two to five times the price of conventional jet fuel and maybe more. As a result, SAF represents only 0.1% of fuel used in airplanes around the world. Such limited availability and high prices discourage investment to increase production, which is necessary to lower prices and allow greater adoption.
Solving this conundrum requires a significant stimulus of demand – exactly what the SAFc mechanism aims to provide. This type of intervention is particularly critical during the pandemic recovery given the perilous financial situation of the aviation industry which makes it unable to subsidize on its own increased use of FAS.
“Now is the time to innovate in reducing aviation emissions. Sustainable Aviation Fuel (SAF) offers the most promising solution to reducing aviation emissions, but today demand for SAF far exceeds supply, ”said Jules Kortenhorst, CEO of RMI. “The World Economic Forum and RMI developed the SAFc to enable ambitious companies to tackle emissions from theft while sending a strong demand signal and catalyzing new production of SAF. “
“By purchasing these certificates, companies and individuals contribute to emissions reductions in aviation,” explains Joukje Janssen, Partner, PwC Netherlands, “because these purchases generate new income for the accelerated increase in capacity production of SAF.
Before the pandemic, aviation was responsible for around 3% of global carbon emissions, with an even larger global climate effect when you factor in impacts such as nitrogen oxides and contrails. COVID-19 has caused a massive drop in air travel and emissions. Demand, however, is expected to pick up in the 2020s, making it a crucial time to put in place a system to transition the industry towards more sustainable use of energy.
Significantly, companies have already indicated that they are willing to pay more for sustainable employee travel practices and the SAFc provides a tailored mechanism for companies to take leadership in this area. In fact, feedback from stakeholders in the CST initiative suggests that corporate demand alone can cover a third of the price premium associated with achieving the goals of the International Air Transport Association. Global volume of FAS 2025 2% target (6-7 billion liters).
In terms of ticket prices, comments from many aviation partners and CST customers indicate that a 5-10% increase in air fares would be acceptable, provided it results in a significant and verifiable reduction in emissions.
Some companies in the CST coalition are already experimenting with the pay more for SAF approach, including Alaska Airlines, American Airlines, Deloitte, Deutsche Post DHL Group, Microsoft, BCG, Neste and SkyNRG. In the Microsoft case, for example, an agreement with Alaska and SkyNRG applies to CO2 emissions from employee travel between Seattle and three California airports.
How does the SAFc system work?
For the SAFc system to function properly and at scale, it requires a robust monitoring and verification process as well as a registry to ensure that climate-related claims are legitimate and are only claimed by one party.
This type of virtual accounting system is already well established in renewable electricity markets through Energy Attribute Certificates (EAC) and Guarantees of Origin (GoO) – an important model for the new SAFc framework. These established mechanisms, which verify that electricity is produced from an eligible renewable source, have helped accelerate investments in renewable electricity by allowing companies to claim the resulting environmental benefits without producing themselves. ‘electricity.
Over the next year, the development of the SAFc framework will move into its next phase, including additional pilot SAFc transactions and the finalization of a comprehensive emissions accounting system.
Mission Partnership possible
Clean Skies for Tomorrow is part of Mission Partnership possible, a coalition of public and private partners working on industrial transition to put the heavy industry and mobility sectors on the path to net zero emissions by mid-century.