SAF was a key topic at the ILA

Sustainable Aviation Fuel (SAF) featured prominently in the various presentations and panels at the Berlin-held aerospace event. It was also a core topic from day one to day five at Berlin-Brandenburg Aerospace Alliance’s stand (BBAA) – the trade association for the aerospace industry in the capital region. “Will the SAF quota of 6% mandated by the EU for 2030 be met by the aviation industry?” was the starting point for debates. This corresponds to a required volume of approximately 3.1 million tons of SAF. Of this, the eSAF share is mandated to be 1.6% which translates into 620,000 tons of eSAF, produced from renewable electricity and CO₂. In the run-up to the ILA, and to spark discussion at the BBAA, CargoForwarder Global asked three cargo industry veterans for their views on the EU’s target – whether they consider it realistic or unrealistic.

Steven Polmans, Senior Vice President, Cargo Global, Swissport
At the current pace, SAF demand is growing faster than SAF supply, and the gap will widen before it narrows. Perhaps Europe can meet its mandated percentages, but the industry is nowhere near producing enough SAF to achieve aviation’s long-term decarbonization ambitions. SAF currently represents less than 1% of global jet fuel consumption. This might be a significant increase compared to a few years ago, but it is still tiny compared to the industry’s net-zero roadmap.

SAFis scaling far too slowly to meet the ambitions that were set five years ago.And I do not see the right actions being taken nor the hard commitments being made to make a solid roadmap towards 2050. I think we do not even talk enough about it. Which might be the most worrying part of all.

Achim Martinka: VP Global Air Freight, Commercial + Sustainability, DSV
Reaching the 6% target by 2030 is ambitious, but achievable.

However, aviation isn’t the only user of SAF. Other industries also have green energy on their agenda to reduce their carbon footprint. And High Tech has deeper pockets.So, it could buy up the bulk of the SAF quota.

As for the share of eSAF, I am very skeptical. The 1.2% quota is an extremely ambitious target. To my knowledge, there is currently no manufacturer of eSAF.

Hendrik Bender, VP Group Sales Business Development & Marketing, Sovereign Speed
In terms of availability, the EU target is achievable. For environmental and climate reasons, decarbonization is an absolute must.

However, the key question is, who will cover the additional costs? Major freight forwarders can pass on the extra SAF charges to their customers. Similarly, members of the pharmaceutical and aerospace industries have the funds to pay for it as well.

But small and medium-sized agents are likely to face financial difficulties. Will they be sidelined and be labeled environmental offenders?

Rounding it off
Panelists and participants consented that the gap between demand and supply, leading to high costs, is the main obstacle to achieving a breakthrough in SAF utilization.Also, it was agreed that the market cannot achieve economies of scale on its own; so clear government guidelines are needed to steadily increase the share of SAF in aviation. However, this must be done within the framework of a level playing field so as not to put European airlines at a cost disadvantage compared to competitors from the Middle East or the U.S. An appeal was also made to the big players among forwarding agents to purchase large SAF volumes from manufacturers and to increasingly involve SMEs by selling smaller margins to them. This would create a broad ecosystem capable of exerting price pressure on SAF manufacturers.

Currently, 39% of the total SAF volume comes from European manufacturers with Neste and World Energy leading the pack by contributing 60%, 34% stems from North America, and 27% from the rest of the world, with African producers completely absent.

Brazil, the beacon of hope when it comes to SAF
Finally, it was a statement from IATA Chief Willie Walsh, regarding SAF, made at the organization’s recent 82nd Annual General Meeting in Rio de Janeiro, that was received positively at the Berlin debate on aviation fuel. There, Walsh had predicted that Brazil has all the ingredients to become a global SAF powerhouse and to become a global leader in aviation’s decarbonization as seen by its broad feedstock availability and its established refining base. “Embracing this opportunity will create jobs, reduce dependence on foreign fossil fuels, build new energy and agriculture industries and grow the economy. With the right policies implemented in the right order, Brazil is ready to jump-start the market,” the official exclaimed.