Corporations, Nonprofits, and Airlines Cooperate to Expand Sustainable Aviation Fuels Use and Capacity

Part 3 of a series, "Sustainable Aviation Fuels (SAF): A Critical Emissions Mitigation Strategy Gaining Momentum"

February 11, 2022

Corporate groups and the airline industry are joining forces to support sustainable aviation fuel (SAF) development and sustainability certification. A vigorous, self-sustaining market for SAF is necessary to achieve the aviation industry's decarbonization goals (see part 1), and partnerships within and outside the aviation community are working to help create that market.

Read the rest of the SAF series:

Demand for SAF exceeds supply so the major U.S. carriers are reaching offtake agreements, or contracts, with suppliers to secure varying amounts of SAF throughout this decade. This third article in the four-part SAF series presents a summary of purchase agreements and support for SAF research and public awareness announced by the major U.S. airlines, and looks at national and global SAF production capacity.

In April 2021, six organizations from across the aviation industry, including Airlines for America (A4A), the International Air Transport Association (IATA), and organizations representing business and general aviation in the United States and Europe, launched the Council on Sustainable Aviation Fuels Accountability (CoSAFA). CoSAFA’s mission is to work to ensure the transparency of the SAF market, by setting standards for environmental and sustainability criteria, in an effort to encourage market confidence and investment in sustainable aviation fuels.

A second SAF initiative began in April 2021 when the Environmental Defense Fund (EDF) and RMI announced the launch of the Sustainable Aviation Buyers Alliance (SABA). SABA-affiliated companies—including Boeing, Boston Consulting Group, JP Morgan Chase, Microsoft, Netflix, and Salesforce—will collaborate to advance new SAF production, technology innovation, and policy development. With a focus on expanding the scale of SAF deployment and reducing production costs, SABA will use a certificate system that verifies the sustainability of SAF production to attract investment by air transport operators and customers.

In June 2021, the World Economic Forum, RMI, and the consulting and data analytics firm PwC Netherlands, as well as additional industry partners, launched a certificate system to provide comprehensive accounting of SAF produced sustainably that can be used in a book-and-claim process, which separates the sustainability claim from the actual physical product. Book-and-claim means that sustainable aviation fuel could be used at an airport close to its production location, while an operator based elsewhere could purchase the associated carbon credit.

Green Air, a publication focusing on aviation's impact on the environment, reports the World Economic Forum and its partners started the Sustainable Aviation Fuel Certificate (SAFc) system to increase the market demand signal and help boost SAF production as part of the Forum’s Clean Skies for Tomorrow program. Corporations wishing to lower the carbon footprint of their business travel can use credits verified by the SAFc system as Scope 3 carbon abatement credits. Airlines as operators and purchasers of the SAF can claim Scope 1 credit for the lower carbon SAF consumed.

Corporate participation helps address the price premium of SAF (as business flyers agree to higher fares and airlines accept lower profits) while the additional demand signal helps generate the investor confidence required to advance production. The result will be expanded use of sustainable aviation fuels and lower carbon emissions from commercial aviation, accelerating the progress made towards the industry's climate target of being net-zero carbon emissions by 2050.

Global offtake agreements for sustainable aviation fuels showed a major increase among the world’s airlines in 2021. According to the UN’s International Civil Aviation Organization (ICAO), there were 53 offtake agreements as of February 7, 2022, with some contracts in progress dating from 2013. More than 20 new agreements were announced in 2021. Previously, the maximum number of agreements announced in a single year was six in 2016.

IATA estimates 100 million liters (26.4 million gallons) of SAF were produced worldwide in 2021, and there are forward purchase agreements for 21.2 billion liters (5.6 billion gallons) through the lifetime of the existing offtake agreements, according to ICAO summaries. The Commercial Aviation Alternative Fuels Initiative (CAAFI), a coalition of airlines, airplane and engine manufacturers, U.S. agencies, energy producers, and researchers, projects rapid growth in SAF production capacity worldwide from approximately 70 million gallons in 2021 to 2.6 billion gallons in 2025.

Every major U.S. airline has made commitments to invest in sustainable aviation fuel. American Airlines has undertaken to purchase 131 million gallons of SAF and has invested $100 million in Breakthrough Energy Catalyst, a coalition of companies, governments, and private philanthropy, to accelerate the development of SAF and other technologies for sustainable aviation. Delta will buy 260 million gallons of SAF under its existing offtake agreements, and has partnered with five companies to purchase SAF. United Airlines* is the world leader in SAF purchases by volume, with offtake agreements for 2.4 billion gallons. Its Eco-Skies Alliance Program includes more than a dozen companies and will ensure the purchase of about 3.4 million gallons of SAF in 2021 for corporate travel. Southwest has agreements with Marathon Petroleum Corp., Phillips 66, and the Department of Energy's National Renewable Energy Laboratory to facilitate SAF-related R&D, public awareness, and policy. FedEx will purchase 21 million gallons of SAF under its current offtake agreements, and Jet Blue has committed to a minimum purchase of 769 million gallons. In October 2020, Alaska Airlines announced an agreement with Microsoft to use SAF in corporate travel between Seattle and San Francisco, Los Angeles, and San Jose. Major U.S. airline offtake and fuel supplier partnership agreements are summarized in the chart below.