Having committed to “net zero” 2050, IATA has identified a massive dependency on Sustainable Aviation Fuel to deliver on that promise. On the face of it that seems like a positive step, but when you break down the way the industry is likely to unfold over the coming decades, it’s not so rosy… at least, not for everyone.
Notwithstanding the title of this document, for the sake of convenience I’m going to revert to using SAF as an abbreviation for Sustainable Aviation Fuel, but if I explain it properly, hopefully the other definition will resonate by the end of the article.
There’s one good reason why SAF suits aviation and plenty of reasons that make it problematic. The one good reason is of course that current aircraft can use it blended with kerosene. It’s problematic because the supply chain is long and fragile. Quantifying net zero emissions at every step is close to impossible and open to corruption, growing successful biomass depends on favourable conditions, and political squabbling over land clearing and the corporate takeover of subsistence farms are all going to play a part, and that’s before you even get it to a refinery. At the other end of the process, some SAF is heavier than kerosene – and some lighter signalling potential operational complications, and the soot from SAF is a different size to that of kerosene – does that potentially broaden the atmospheric conditions under which contrails will form? And what of other “aerosol effects” on the climate? For all the hyped benefits, are we walking into a minefield of unintended consequences?
Oh yeah, right now, SAF is 8 times the cost of kerosene.
Despite that, IATA is projecting an ever-increasing market for SAF over the next 25 years, with it supposedly accounting for 80% of the CO2 abatement of the industry by 2050. It looks like a great time to be a biofuel producer, right? Well, not quite.
IATA’s position on SAF ignores the elephant in the room. There’s an existential threat to the airline industry that scares IATA so deeply that they won’t even whisper about it – that threat is green hydrogen. Imagine replacing the convoluted supply chain for SAF with a refinery built on the coast. The moment technology makes green hydrogen a reality, investment in SAF will plunge, making it impossible for the price to come down and for production targets to be met. SAF will become the very definition of a stranded asset. IATA will have hyped the SAF industry to ramp up production, but with airlines operating on 3% profit margins, they won’t pay more for fuel – they can’t. Even using a blend with 20% SAF, at twice the price of kerosene it would be crippling. All eyes will turn to green hydrogen and SAF’s time will be over.
But what about the new aircraft that airlines are ordering now and expecting to be running until 2050? No modification will ever allow current aircraft to run on hydrogen, so if there’s no SAF and kerosene has to go, are airlines expected to wholescale replace their fleets? Where are they going to get the money to do that?
The commitment of the airline industry to SAF isn’t based on environmental considerations, it’s based on extending the timeframe before it’s faced with change that could resign many airlines to the history books. It’s a business decision dressed in sheep’s clothing. The airline industry knows that SAF isn’t the answer, but it’ll rally as hard as it can to attract investment to it. Mind you, they won’t be investing themselves. If their new aircraft are already a stranded asset waiting to happen – the last thing they’re going to do is invest in the fuel to run them.