Civil Aviation Future Is Green

One of the cornerstones the energy transition is based upon is the electrification of transportation. However, the focus is on the automotive sector, since it is the one that produces the most emissions. Other transportation sectors have received less attention. For example, the aviation sector accounted for 12% of global transportation systems emissions in 2022. According to the International Energy Agency (IEA), aviation accounted for 2% of total emissions in 2022. Again, according to the IEA, primarily due to the resumption of international flights, emissions have started to rise again at a rapid pace and have reached about 800 Mt of carbon dioxide, about 80% of those recorded in 2019.

International organizations that are coordinating the aviation sector in line with the goal of achieving zero emissions by 2050 have long presented their plans to reduce, or at least slow, carbon emissions. For example, already in 2016, the International Civil Aviation Organization (ICAO), the UN agency for coordinating policy and cooperation in the civil aviation sector, approved the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), set up to limit the growth of civil aviation carbon dioxide emissions starting from the 2021-2023 biennium, but airline participation in this phase was entirely voluntary. However, starting in 2024 and continuing through 2035, a mandatory emissions reduction phase has begun, during which the entire industry will have to work to reduce emissions by at least 15% from the levels recorded in 2019.

The majority of aviation carbon dioxide emissions come from burning Jet A-1 kerosene in aircraft engines. To reduce the amount of carbon dioxide emitted, the use of hydrogen or batteries to propel the aircraft could be implemented, but these solutions would require a complete upgrade of the aircraft and new refueling infrastructure, which requires a very long development period. At this point, a more immediate decision can already be made. Sustainable Aviation Fuel (SAF) is a more environmentally friendly fuel that reduces emissions from engine combustion by allowing blending with conventional Jet A-1. As defined by the International Air Transport Association (IATA), “green” kerosene is a type of liquid fuel that can be produced from a variety of sources, “including waste fats, oils and greases, municipal solid waste, agricultural and forestry waste, wet waste, and non-food crops grown on marginal lands.”

Another SAF category still under development is synthetic fuel, e-fuel, or eSAF, which is produced using the process of electrosynthesis.

SAF can be considered “sustainable” because the materials used to produce it do not compete with crop or food production, nor do they require additional use of raw materials, such as water or land clearing, and furthermore, they generally do not affect environmental issues, such as deforestation, loss of soil productivity, or biodiversity. The greatest advantage of this fuel is potential 80% reduction of emissions from kerosene production and consumption, as well as the potential recycling of additional amounts of carbon dioxide through sequestration by the biomass used to produce the fuel. IATA estimates that the widespread use of SAF alone could contribute approximately 65% to achieving the goal of zero emissions by 2050 in the aviation sector.

Given the ability to blend SAF with traditional kerosene and the potential for these fuels that are so promising for the environment, why is their use then completely marginalized? According to the IEA, the introduction of cleaner fuels accounts for about 0.1%. Given current employment levels, the road to achieving zero emissions targets by 2050 is still long and full of obstacles. IATA estimates that investments of $5 trillion, or about $180 billion per year, will be required through 2050. Investments will be made not only for the development of new technologies, but also for the creation of new infrastructure for the production and use of SAF. IATA’s plan is quite ambitious, as it strives to jointly develop technological solutions aimed at 100% SAF utilization, beyond the use of hydrogen and electricity, for both airplanes and for airport infrastructure.

To encourage mass adoption of SAF by 2030 and 2050, European regulators, for example, have set SAF volumes at all airports in Europe to be at least 2% of total fuel by 2025. By 2050, 70% must be achieved, of which 35% should be e-fuel. However, at the end of 2022, according to the European Aviation Environmental Impact Report, the maximum European production capacity was about 0.24 million tons of SAF per year. In the USA, in 2021, goals were set to produce 11 billion liters of SAF by 2030, which represents more than exponential growth given today’s production volume of about 56 million liters. However, S&P Global estimates that US manufacturing capacity, even if all of the announced projects are implemented, will not exceed 7.5 billion liters in 2030.

The problem of very limited production capacity is a real obstacle to the widespread adoption of SAFs, particularly through their blending with conventional kerosene. According to the IEA, although aircraft manufacturers and airlines are increasingly experimenting with flying using SAF, even up to 100%, the planned future production capacity will only be able to meet 1-2% of demand by 2027. To date, SAF’s total production volume is approximately 1.9 billion liters, or 0.53% of the estimated global aviation fuel requirements for 2024. Achieving 10% SAF deployment by 2030, a target consistent with the net zero emissions scenario, will require a significant increase in investment in further SAF capacity expansion projects, as well as the development of further dedicated support policies and new standards to identify low-emission fuels.

When talking about SAF’s plans to expand production capacity, one thing to consider is the trade-off between the technology used and the raw materials required to produce the e-fuel. To date, the only viable commercial alternative that can be used on a large scale to obtain SAF is the production of synthetic paraffin kerosene derived from HEFA (Hydrotreated Esters and Fatty Acids) oils and fats, which have an energy density close to that of fossil fuels. Their maximum mixing ratio with traditional kerosene is 50%. However, given the political objectives of large-scale SAF utilization, the feedstock may not be sufficient to meet the growing demand for this fuel, and this is why other feedstocks, such as municipal solid waste, for example, or even carbon dioxide will be necessary. It is the use of carbon dioxide to produce eSAF that is considered to be the technology to become dominant for fuel production in the future. This process involves using “green” hydrogen, i.e. obtained through electrolysis using electricity generated from renewable sources, to convert carbon dioxide (in the air, from biomass, or from industrial sources) into carbon monoxide. Then, using Fischer-Tropsch synthesis technology, this carbon monoxide, along with green hydrogen, will be converted into wax that can be processed into synthetic kerosene. Within this framework, not only investments in the development of electrolysis process technology are needed, but also additional financial resources to increase green hydrogen production capacity, given the high energy intensity of the eSAF production process.

Research by PricewaterhouseCoopers (PwC) paints a picture that contrasts with the political intentions of institutional bodies: not only will the cost associated with SAF always remain higher than kerosene, but at least until 2040 there will be significant reductions in its production costs. In 2022, according to IATA, the average SAF price was about $2437 per ton, two and a half times higher than that of kerosene, which is about $1094 per ton. According to the European report on the environmental impact of aviation in 2022, the cost of SAF, depending on the production technology used, can be up to six times higher than the cost of polluting fuel. In September 2023, IATA Director Willie Walsh recognized that SAF will always be more expensive than traditional kerosene.

In November 2023, the airlines Emirates and Virgin Atlantic flew two test flights with 100% SAF engines. But greater resonance was caused by the experiment of a British company that managed to cross the Atlantic Ocean with all engines running on HEPA (88%) and synthetic kerosene (12%). The flight was made possible thanks to the formation of a consortium between Virgin Atlantic, consulting firm ICF, Rocky Mountain Institute, University of Sheffield, Imperial College London, Rolls-Royce, and Boeing. This test flight was also completed thanks to the intervention of the British government, which, through the Department for Transport, partially funded its implementation. Given the technology available today, without government intervention and pressure, the energy transition risks remaining a political manifesto that will place a burden on the shoulders and wallets of citizens. In the case of civil aviation, for example, increased fuel costs will lead to higher airfares because, in today’s market logic, airlines, in order to maintain a satisfactory level of profit for their shareholders, will not hesitate to pass increased refueling costs on to passengers. In June 2024, Lufthansa, for example, announced that ticket prices would rise, depending on the route, by approximately 72 euros per passenger. However, Germany’s flagship carrier is not the first company to decide to raise ticket prices due to the high costs of refueling its planes. Already in 2022 Air France – KLM announced a fare increase to reduce the impact of more expensive SAFs.