Why Sustainable Aviation Fuel Is So Important to Airlines
October 2018 saw aviation history – the first commercial flight using sustainable aviation fuel took to the skies, transporting passengers from Orlando, FL to London. Since that time, though, while much has been written on sustainable aviation fuel, it’s a resource that remains very much under development. The technology to produce this type of fuel is simply not progressing at the pace airlines, and those who use them, would like it to be, yet it remains a priority. Why does it matter so much to airlines? Northwest Advanced Bio-Fuels, LLC CFO Bernard Asher and Manager David Smoot had a moment to sit down and explain the value proposition in a recent interview.
A Simple Answer – Carbon Offset Requirements
The International Civil Aviation Organization (ICAO) is a specialized agency within the UN, and it was created to manage civil aviation at the global level. To date, over 190 countries have agreed to support the 2016 Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) mandate to address the reduction in greenhouse gas emissions from non-military sources. According to the agreement, by 2026, international airlines that are not in compliance with a reduction in their carbon footprints will have an annual obligation in the form of carbon offsets or penalties for every gallon of jet fuel they use for international air travel.
Asher said, “If you have an airline that uses 200 million gallons of fuel for international flights and they haven’t met their obligation to reduce carbon emissions, they theoretically could be fined annually until they get in compliance. That means nearly every international airline could now be looking for renewable jet fuel.”
For many companies, this may be challenging because under the CORSIA mandate airlines will be required to buy carbon offsets to compensate for their growth in CO2 emissions and these “penalties” could be quite significant to airlines not in compliance.
Asher said, “I suspect we may see the State of California legislate a renewable fuels requirement for domestic flights themselves. Then, that’s going to put pressure on all airlines stressing the supply of renewable fuel even further. If airlines can’t get the fuel, and they cannot fulfill their obligations, that may result in carbon offsets and penalties domestically as well.”
Where does Northwest Advanced Bio-Fuels (NWABF) come into the picture? They’re one of the biggest disrupters in the sustainable aviation fuel market today. NWABF will deploy a unique gasification process that takes green wood waste from hundreds of thousands of acres of timber feedstock and turns it into sustainable aviation fuel. They are one of the most advanced up and coming Developers with renewable jet fuel projects.
Their project is so advanced, Delta has invested $2 million to complete a sustainability study with NWABF to ensure their project is the perfect fit for this airline giant. “We are excited to partner with Delta Air Lines in lowering the airline’s carbon footprint and supporting Delta’s sustainability strategy,” said Dave Smoot, Manager of Northwest Advanced Bio-Fuels, LLC.
Asher said, “The CORSIA Mandate is an overhang on all the airlines flying internationally. There’s a very senior transportation executive we know, who used to say, ‘There is nothing like a mandate to make a market.’ The reality is that the demand for sustainable aviation fuel is only growing, and Northwest Advanced Biofuels, LLC is in a place to make it happen.