SAF heads into the Big East: India and Turkey to scale up domestic SAF production amid proliferating deployment of bio-based fuels worldwide

By Vinayak Shinde, Global Market Insights
Special to The Digest

Endorsing the importance of sustainable airlines in achieving net-zero emission goals, the global aviation fuel market is gradually moving from low-carbon to carbon-negative infrastructure. According to a study by Transport and Environment, a European network of NGOs, about 193 out of 230 of some largest global businesses failed to act on corporate travel emission reduction with adequate commitment. In order to mitigate these growing concerns, jet fuel manufacturers are hoping to lead the green air travel revolution by adopting cleaner fuels. 

Over the last few years, the commercialization of naturally sourced sustainable aviation fuel (SAF) has picked up momentum, especially across the aviation fuel industry in North America. Recently, in September 2022, a U.S.-based producer of sustainably sourced woody biomass, Enviva, signed a contract with Alder Fuels, a clean tech company, for scaling up the production of low-carbon transportation fuels. The partnership makes Enviva an exclusive biomass provider of over 750,000 metric tons annually to Alder’s premier Greencrude production facility that will commercialize the supply of SAF.

Increasing number of SAF mandates on a global scale

Following the commitment of all major U.S. airlines to net-zero carbon emissions by 2050, acceleration of SAF production appears to be the next step toward carbon-neutral air travel. Aligned with these goals, the U.S. White House introduced the ‘SAF Grand Challenge’ for producing about 3 billion gallons of the product by 2030, which will reach the 35 billion gallons mark by 2050.

Along similar lines, the Europe SAF industry is making substantial progress with considerable support from policies such as ReFuelEU. Under this policy, the European Parliament voted in favor of new norms that will make SAF mandatory for at least 85% of the EU aviation fuel market by 2050. 

Likewise, as part of the Clean Skies for Tomorrow (CST) coalition, the United Arab Emirates is planning to implement a roadmap for developing Power-to-Liquid (PtL) sustainable aviation fuel. The national Ministry of Energy and Infrastructure, alongside the World Economic Forum (WEF) and CST, are collaborating on a white paper for enabling a smoother transition to green aviation fuel technologies in the UAE.

Dependence on indigenous ATF production to increase in India

Marking a hike of nearly 50% since the beginning of 2022, high air turbine fuel (ATF) prices are plaguing airline carriers in India. With the cost of operations becoming a source of worry, flying schools in India are witnessing higher demand for domestically produced aviation gasoline (Av gas). The Indian Oil Corporation (IOC) is planning to cater to the needs of over 38 flying schools throughout the nation. 

With eight new schools expected to commence operations from FY2023, IOC will deliver more than 1,500-2,000 tons of Av per annum. The ongoing geopolitical tensions are likely to create a shortage of Av gas, as the needs of the Indian Air Force (IAF) are expected to rise. Experts suggest that since indigenous production of these products can be cheaper, India aviation fuel market will see a steady rise in domestically produced reserves over the next few years.

Younger fleets in Turkey plan to rely on bio-kerosene

With a widespread network across more than 330 destinations across 128 countries worldwide, Turkish Airlines is aiming to minimize its environmental impact by combining fuel-saving strategies with SAF production. Turkey bio-kerosene market is expected to expand steadily after the launch of the air carrier’s debut SAF flight from Istanbul to Paris in February 2022. 

Scientists at regional universities are developing synthetic bio-kerosene, which is produced using microalgae. On the completion of the engine tests carried out by Turkish Technic this year, this variant will replace traditional kerosene, becoming one of the cleanest biofuels accredited by IATA. Since the country has some of the youngest fleets averaging around only 8.7 years across more than 370 aircraft, offsetting emissions will be easier for the service provider using a new jet fuel technology.

With business flights accounting for nearly 30% of all air travel in Europe, aviation companies are tackling emissions by promoting a sustainable flying experience. International flight services are keen on joining hands with regional suppliers of sustainable fuel alternatives. To cite an instance, recently, in May 2022, Neste, a Finland-based fuel provider, announced that it has successfully supplied SAF to Etihad Airways at Narita International Airport in Japan. This made the Middle Eastern carrier the first overseas airline to receive SAF in Japan.

In the face of ongoing challenges, airline companies are set to diversify themselves from their competitors in terms of higher cargo and passenger incomes. The next decade might bring a continual spike in crude oil costs and jet fuel prices, encouraging more air carriers to adopt clean aviation fuels like SAF and biokerosene. EU countries, the UAE, Turkey, and India are expected to establish their stature as global leaders in the global aviation fuel market, as affordable light service providers expand their presence worldwide.