A net-zero pathway through sustainable aviation fuel
For years aviation has been one of the many sectors subject to growing calls for increased environmental stewardship and sustainable leadership. It comes as no surprise that investors and corporations have been driving this pressure given that the global aviation sector produces 750 million tons of CO2 from the jet fuel burnt each year. The impact is especially problematic at the business level, where organizations driving a carbon reduction agenda are burdened with a significant Scope 3 emissions footprint from corporate travel. In this article, we’ll unpack the recently announced Sustainable Aviation Fuel certificates (SAFc) framework including the benefits to companies and the aviation sector, plus what the roadmap for SAF certificates looks like over the next 2 years.
SAF certifications for organizations explained
Companies seeking ways to reduce their carbon footprint and emissions associated with corporate travel will welcome the SAFc framework developed through the World Economic Forum’s Clean Skies for Tomorrow initiative, which will allow organizations to claim sustainable aviation fuel emissions reductions if they elect to shoulder the increased cost of the SAF.
The SAFc framework will allow corporate customers to reduce emissions from corporate travel whilst increasing the demand for SAFs. The indirect emissions reductions go to the organizations who purchase the certificate, but the airline’s emissions are also reduced which counts towards its own Scope 1 calculations.
Accounting for SAFs has many parallels with the market-based approach to accounting for renewable energy purchases. Renewable Energy Certificates (REC), for example, are purchased by consumers to cover the consumption in much the same way that SAF certificates are purchased within this model.
Similarly, the SAFc system will include a traceability registry for corporate buyers which mirrors the concept of generating, selling, and transferring certificates seen with RECs.
Sustainable aviation fuel costs lowered by the new framework
SAFs are already available and compatible with existing carriers, however, the SAF which is often made from agricultural and commercial waste is up to 40 times more expensive than existing jet fuel refined from crude oil.
Therein lies the problem, but also the solution. By scaling up the production of biofuels as encouraged by the SAFc framework, the expense decreases whilst uptake organically increases.
And it is this uptake that is intended to be driven by organizations with ambitious carbon targets, who will purchase SAF certificates and in turn fund the increased and rapid production of sustainable aviation fuels.
The framework provides a realistic solution with SBTi and GHG endorsement
The Clean Skies for Tomorrow initiative expects to have SAFc recognized by the Science Based Target initiative and GHG Protocol in 2022 or shortly thereafter, as a viable method for organizations to realize targets for Scope 3.
These endorsements will provide the SAFc system with the credibility it requires to be widely adopted, supported by decision-makers as another decarbonization pathway for their organization, and serves as a sustainable method of funding the use of biofuels across the aviation sector.
The next stage in the SAF certificate model
The SAFc framework report has only recently been released, with additional details expected to be made available in the coming months to address concerns about Scope 3 double counting. Operational aspects such as finalizing a detailed accounting process and certification system are expected to be delivered in 2022, with a broad rollout following suit in 2023.
The rapid rate at which the SAFc framework is being formed is also apparent in the “demand signals” shown through the partnerships forged between Clean Skies for Tomorrow and corporations such as Deloitte, United Airlines, Microsoft, Boeing, and BlackRock who are set to pilot the SAFc model. It is a rapidly moving initiative that aims to have the system completely adopted globally and internationally recognized in three years’ time.
Most recently, British Airways has announced a multi-year agreement to supply SAF, produced in the UK at Phillips 66 from feedstock and expected to be in production in 2022.
In the largest-ever SAF agreements made to date, in March 2022 DHL Group also announced that the company will source more than 800 million liters of SAF over the next few years which will help them to avoid millions in tonnes of CO2.
Other industry applications of SAF certificates
There certainly appears to be potential for applying a SAFc blueprint across other sectors which makes this approach particularly interesting. Once fully operationalized, we can see how the SAFc model could possibly be used across shipping, road transport, and even certain types of real estate if the embodied emissions can be quantified.
As these industries and others become required to undertake increasingly nuanced GHG accounting, we anticipate the model to be applied extensively and become a standardized approach in an organization’s pathway to decarbonization.
The SAFc framework certainly comes as a welcome addition to the sector’s emissions-reduction strategies, however it will require widespread uptake across the aviation value chain and endorsement by ambitious corporations alike to ensure its adoption ‘takes off’ and scales within the intended time frame.