This is a re-post of an MFAT Market Intelligence Report. The original is here.
The reduction of carbon emissions from jet fuel is a challenge being grappled with globally. It is also a pillar of California’s climate response efforts. The state is taking steps towards increased production and use of sustainable aviation fuel (SAF) as it looks to lead US climate response efforts for fuel decarbonisation. However, challenges to implementing production incentives are impacting its targets, while the industry’s demand for access to a greener emissions profile continues to increase.
Over the past months there has been increasing commentary in California on the growing use of sustainable aviation fuel (SAF) from both Los Angeles (LAX) and San Francisco airports.
SAF is an alternative fuel that has potential to dramatically reduce lifecycle carbon emissions compared to traditional jet fuel (up to 85%), and is a ‘drop in’ replacement. It is synthesised from feedstocks such as forestry residues, cooking by-products like vegetable oil, algae, animal fats, or waste from landfill, agriculture, and municipal solid waste. While the climate benefits of SAF are significant, the aviation industry is encountering challenges in scalability, cost, and availability.
Given the aviation industry is dependent on jet fuel, transitioning to sustainable alternatives on a larger scale demands substantial increases in production capacity. Four years ago, SAF accounted for just 0.1% of global fuel supply compared to the current 1%. With over 50 airlines now planning to use SAF to partially operate their flights, demand is soaring.
Global SAF production is currently limited. This is partly due to low incentives and high costs for oil refineries. The raw materials used to produce SAF are also used in other industries like food, cosmetics, and chemicals. Competition for these feedstocks further drives up prices and limits the international supply available for SAF production. Striking a balance between using feedstocks for SAF while ensuring food security and avoiding environmental impacts from land-use change is a complex task for policymakers looking to incentivise production.
These constraints on production are increasingly recognised, and with low supply and high demand, SAF is currently sold for up to four times the price of regular jet fuel.
Industries are attempting to make headway on SAF usage. United Airlines promotes its use of SAF from LAX on its 140 daily flights, however, it notes that only 0.1% of its overall fuel use is currently SAF. Another commercial stakeholder in the US investing in SAF is the Bank of America, who have made a US$1.5 trillion, ten-year sustainable finance commitment. This includes committing US$2 billion in sustainable finance for SAF production and other low carbon aviation solutions, and a 10-year partnership with SkyNRG to support the production of 4.5 million litres of SAF per year, beginning in 2025. The Bank of America also has a three-year agreement with American Airlines to support the purchase of 3.8 million litres of SAF annually.
California’s green leap: State Legislature passes bill to achieve 20% SAF use by 2030
California continues its work to achieving its goal of carbon neutrality by 2045, requiring a 94% reduction in petroleum use and 86% percent reduction in total fossil fuel use between 2022 and 2045. Efforts to mitigate challenges in implementing SAF production incentives may impact these targets.
In late August 2022, the California Legislature passed a bill that will require the California Air Resources Board (CARB) to develop a plan to incentivise the production of sustainable fuels. In doing so, this bill will set a SAF usage target for aircraft in California of at least 20 percent by 2030. This bill will require CARB to begin implementing the plan by July 2024.
In creating the plan, CARB will quantify greenhouse gas reductions associated with SAF, identify barriers to the SAF production targets, set milestones for achieving the targets, ensure that SAF incentives are comparable to other renewable fuel incentives, and identify tools for increasing SAF supply and demand, including buildout of relevant infrastructure.
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So California is forcing a move away from fossil fuels with increasing requirements for use of SAF produced from organic materials, either waste, by-product or crops for fuel production. My impression is that this is to maintain the aviation sector with a Global Warming emissions profile that is more circular with reduced use of fossil sunshine. But still burning fuel and creating emissions.
That all sounds soooo virtuous BUT.....
Competing demand for the inputs to produce SAF is already recognised. I assume that will trigger market pricing dynamics whereby price of SAF (presumably this "sustainable" fuel can be reasonably readily adapted for use in other internal combustion engines) will rise with costs of air travel/freight increasing too. Leading to a reshuffle of competitive advantage hierarchy between sectors.
One element in this fossil fuel substitution move that I cannot reconcile is that the amount of sunlight arriving on planet earth is fixed. Plants, through photosynthesis, are by far and away the most efficient at harnessing that solar energy. There is an optimal ratio of plant leaf area to land area - you can't just double plant density and expect double the solar energy conversion - farmers have recognised this for, well, pretty much forever.
Where, then, is the organic feedstock for fuel production going to be sourced from?
Ahh, forestry waste maybe? But a lot of that forestry waste feeds the soil microbiom, replenishing nutrient removed when the logs are harvested. There is also a big question about the energy efficiency of collecting that waste and transporting it to a processing facility that also has an energy input - what is the net gain if any? We are deluding ourselves that we can substitute and maintain the status quo.
Powderdownkiwi has been right on the nail for a long time now. As a mammalian species we are living beyond our planet's means. The ultimate crisis will come and I reckon the vast majority of humans are in wilful denial.
Thank you. Doggedness is my middle name :)
But I do what I do, to make things better for my grandkids. That's an easy yardstick; will they thank us for this?
And the answer, re aviation, is; No. It takes quite a lot to say that; I love flying, have loved aeroplanes, built models, flew myself to heights I'd only dreamed of as a nipper. But; NO.
I'm not sure it's wilful, LouB - have you read this piece? https://dothemath.ucsd.edu/2015/04/programmed-to-ignore/
Maybe they really can't think in the way thinking has to be done? A sad thought, given what's ahead...
There is simply not enough biomass to replace our fossil fuel use. Without fossil fuels, we won't be flying much if at all.
The Physics of Limits | The Physics Teacher | AIP Publishing
On another front, if we were to replace our 18-TW energy habit by burning biomass in some form, what is the relevant timescale? In other words, dividing the energy content in all biomass (land and sea) by power indicates how long it would take to burn it all (and thus how rapidly it would all have to be replaced to be sustainable). Estimates of total biomass are about 500 Gt (dry), which incidentally stacks to 1 mm high if spread across Earth’s surface (life is thin and precious). At an energy density of about 4 kcal/g, we get a timescale of 15 yr to burn it all. It takes longer than that to replace forests, so reliance on biomass can be ruled out as a sustainable approach, at the present scale of energy demand.
On a technical note, solar panels have surpassed photosynthesis in efficiency of turning sunlight into energy. However, plants are sustainable (not fertilised monocultures, but plants in general) whereas solar panels are not as they require mining, refining and manufacturing.
I think you are wrong in that efficiency assertion.
You are conflating harnessing of solar energy with output of an energy dense process.
My understanding is that photosynthesis is high 90s% efficient in transforming solar energy into a form able to drive the growth and maintenance functions of the plant.
By contrast, the record for solar panel (actually individual cells) is about 40%. To utilise that energy requires processes etc that require energy to function (think cables, batteries, controllers, etc) before that energy is available to boil the water in your kettle. I have no idea what those "friction" losses may be.
Also, I doubt you have factored in the energy input required to produce the solar panel/cell.
That's not a balanced comment; try apples with apples?
Solar PV is really somewhere south of 20%. And a little south of photosynthesis - which doesn't need mined, processed, delivered, maintained, disposed-of. It's all about solar acreage; we will never do aviation before we do food, and anyway, the financial ponzi has collapsed before it gets down to that, so no flying anyway.
There is a lot of emotional hype around aviation fuels. In California there was considerable public pressure to close Santa Monica airport. One of the reasons was that the lead in the 100 octane Avgas was poisoning the people who lived in the vicinity. Most people were ignoring the developer pressuring the local politicians to redesignate the land for development. The lead poisoning claim was investigated by aviation advocates and they unearthed a recent independent scientific study which specifically tested for the lead poisoning and other effects on the health from ICEs. The result indicated that living near freeways had the highest health hazard, while living near an airport had virtually none. The was potentially some impact of noise. The developers and politicians still want to close the airport, and ultimately they may just win.
Same in Europe - everyone pushing hard for these SAF fuels. Science aside there simply isnt enough biomass to do this and the cost of the material will be high as they will need all the logs from a forest for the volume so the cost of the fuel would be very high. Alongside all the other things biomass is apparently going to provide feedstock for - plastics, heat etc etc
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