The Sustainable Aviation Fuel Bill was introduced to the UK Parliament on 14 May and, if passed, will establish a revenue certainty mechanism that sets a fixed price per unit of SAF.
It will give producers price stability and should support sustainable aviation fuel (SAF) production in the UK by helping to de-risk investment in production.
This is something that Logistics UK has been calling for for some time, so it is good for the sector that the government is listening to industry as it continues its journey towards net-zero emissions.
On the same day, the government also announced an additional £400,000 of funding for producers, which should also help the aviation industry meet its requirements under the SAF Mandate, introduced in January this year.
The mandate specifies that at least 10% of all jet fuel used in flights taking off from the UK from 2030 should be made with sustainable fuel, rising to 22% by 2040.
Sustainable aviation fuel as a drop-in fuel is a vital alternative to traditional kerosene jet fuel, reducing aviation lifecycle greenhouse gas emissions by up to 80%.
It also lowers other harmful pollutants, such as particulate matter and sulphur oxides, contributing to better air quality around airports and reducing the aviation sector’s overall environmental impact.
With no zero-emission alternative currently viable for long-haul flights, SAF is the most significant opportunity to reduce aviation emissions in the medium term.
SAF is now a proven technology and is used in aircraft today, therefore, attention must turn to addressing barriers around costs and increasing production to meet rising demands.
It will be essential to expand feedstocks beyond HEFA (Hydro processed Esters and Fatty Acids derived from oils or fats) to include other sustainable sources such as waste and these options should be explored without passing along costs to industry.
Producing SAF domestically in the UK carries several economic and strategic advantages. First and foremost, producing SAF in the UK will increase availability, addressing a key concern around security of supplies, as well as helping to reduce overall costs as the industry is scaled up.
Domestic production of SAF can have wider national benefits too, such as stimulating economic growth by creating new jobs across the supply chain, from feedstock production to fuel distribution.
This has the potential to benefit local economies, particularly in rural areas where biomass feedstocks are sourced, and in industrial regions where new SAF production facilities are established.
A key challenge for emerging SAF projects is the uncertainty of revenue streams, which can deter investment and hinder the growth of the industry.
This is why the government must ensure the bill passes through parliament as quickly as possible to ensure a revenue certainty mechanism is operational as soon as possible, given the SAF mandate is already effective and has been since the beginning of this year.
By integrating SAF into the fuel supply chain and adopting higher SAF blends, the aviation industry can make significant progress towards achieving international climate targets and support the UK’s commitment to reaching net-zero emissions by 2050.
