IATA Sustainable Aviation Fuel Roadmap

IATA Sustainable AviationFuel Roadmap1st Edition

NOTICEDISCLAIMER. The information contained in thispublication is subject to constant review in thelight of changing government requirements andregulations. No subscriber or other reader shouldact on the basis of any such information withoutreferring to applicable laws and regulations and/or without taking appropriate professional advice.Although every effort has been made to ensureaccuracy, the International Air Transport Associationshall not be held responsible for any loss ordamage caused by errors, omissions, misprintsor misinterpretation of the contents hereof.Furthermore, the International Air TransportAssociation expressly disclaims any and allliability to any person or entity, whether apurchaser of this publication or not, in respect ofanything done or omitted, and the consequencesof anything done or omitted, by any such person orentity in reliance on the contents of this publication. International Air Transport Association. AllRights Reserved. No part of this publicationmay be reproduced, recast, reformatted ortransmitted in any form by any means, electronicor mechanical, including photocopying, recordingor any information storage and retrieval system,without the prior written permission from:Senior Vice PresidentMember & External Relationsand Corporate SecretaryInternational Air Transport Association33, Route de l’Aéroport1215 Geneva 15 AirportSwitzerlandIATA Sustainable Aviation Fuel RoadmapISBN 978-92-9252-704-4 2015 International Air Transport Association. All rights reserved.Montreal—Geneva

Table of ContentList of Figures . vList of Tables. viForeword .viiExecutive Summary .viiiSection 1—Introduction . 11.1Background and Aim of the Roadmap . 11.2Industry Commitments . 2Section 2—Timeline . 42.1Introduction. 42.2Test Flights . 52.3Certification . 52.4Commercial Flights . 72.5Multi-stakeholder Sustainable Aviation Fuel Initiatives . 92.6Airline/fuel Supplier Collaboration .122.7Airport SAF Supply .132.8National and Industry Targets .152.9Supply and Demand Evolution .162.10Political and Economic Perspectives .172.11Long-term Developments .18Section 3—Technical and Economic Background .21st3.1Technology Pathways and Cost Expectations .213.2Fischer-Tropsch (FT) .213.3HEFA.223.4Synthesized Iso-Paraffins from Hydroprocessed Fermented Sugars (SIP) .223.5Cost Expectations of Technology Pathways .223.6Availability and Economics of Feedstock Worldwide .233.7Wood and Forestry Residues .243.8Agricultural Biomass .253.9Algae .263.10Wastes and Residues .263.11Cost Expectations of Feedstock .273.12SAF Efficiencies and Associated Lifecycle Emissions.271 Edition 2015i

IATA Sustainable Aviation Fuel Roadmap3.13SAF Supply Chain. 293.14Biojet Fuel Price . 293.14.1Evolution of Fossil Jet Fuel Price . 303.14.2Price Forecast . 303.14.3Links between the Prices of Biofuels and Food . 313.15Differences, Competition and Synergies with the Road Transport Biofuels Industry . 313.15.1Differences . 313.15.2Synergies and Competition. 32IATA‟s Role in the Commercialization and Deployment of SAF . 333.16Section 4—Sustainability Assessment and Proposals for Harmonization . 344.1Introduction . 344.2Overview of Legislation on Biofuels . 344.2.1Introduction . 344.2.1.1Overview of Some National and Regional Initiatives. 344.2.2European Union (EU) . 354.2.3United States (US) . 374.2.4Brazil. 394.2.5Australia. 394.3Comparison between the RED and RFS . 404.3.1Similarities between the Standards . 404.3.2Differences between the Standards . 414.4Overview and Comparison of Relevant Voluntary Schemes. 444.4.1Voluntary Scheme Selection. 444.4.2Review of Selected Voluntary Schemes . 454.5Comparison of Key Aspects of Voluntary Schemes . 454.6Development of Proposals for Harmonization . 484.6.14.7Setting the Sustainability Ambition Level . 48Harmonization Options . 494.7.1Mutual Recognition between RED and RFS2 for Aviation . 494.7.2Meta-standard for SAF . 514.8Policy options. 534.8.1Meta-standard for Aviation Biofuels . 534.8.2Mutual Recognition between RED and RFS2 for Aviation . 54Section 5—Accounting for SAF . 55ii5.1Introduction . 555.2Design of the Global Market-based Measure . 555.3Chain of Custody Approach. 56st1 Edition 2015

Table of Content5.4Overview of Design Choices for the Accounting System .575.4.1Control Point .585.4.2Airport or Airline Level Reporting .595.4.3Central Registry or Verification at the Fuel System Level .615.4.4Limit on Percentage of Biojet Fuel Reported.625.4.5Timeframe .645.5Policy Options.66Section 6—Economics and Effective Policy .696.1Introduction.696.1.1Policy Instruments Incentivizing Deployment of SAF .696.2Economic Instruments .706.3Command and Control Instruments.716.4Co-regulation Instruments .726.5Voluntary Initiatives and Collaborative Instruments.726.6Inventory of Existing Biofuel Policy Instruments around the World .736.7Policy Actions .74Section 7—Financing Models .757.1Background .757.1.17.2Investment in Fossil Fuel.75Fossil Jet Fuel and Price Forecast .757.2.17.3Population Assumptions .76Potential SAF Funding Concepts .767.3.1Background .777.3.2Cost Benefit Analysis – Overview .777.3.3Potential Biojet Fuel Cost-benefit Analysis Examples .797.4Airline Demand .827.4.1Standard Off-take.827.4.2Intermediary Offtake.827.4.3Floating Purchase Agreement .827.4.4Infrastructure Funding Model.83Section 8—Success Stories and the Opportunity .84st8.1Overview .848.2United / AltAir.848.3British Airways / Solena .858.4SkyNRG – Green Lane Program .851 Edition 2015iii

IATA Sustainable Aviation Fuel Roadmap8.5Total / Amyris . 858.6Cathay / Fulcrum. 86Section 9—Conclusions. 87Appendix: Key Features of Selected Voluntary Sustainability Schemes . 891.2BSvs. 892.Bonsucro EU . 913.ISCC EU. 934.RSB EU RED. 965.RSPO-RED . 99Glossary . 102Acronyms . 104ivst1 Edition 2015

List of FiguresList of FiguresFigure 1.Alternative fuels flight tests between 2008 and 2013 . 5Figure 2.Past and future ASTM certifications of SAF production pathways . 6Figure 3.Source: ICAO .11Figure 4.Mapping of worldwide initiatives (based on announcements recorded in GFAAF - not meant tobe exhaustive – mainly initiatives since 2013) .12Figure 5.Current bioport projects .14Figure 6.Sum of current airline intentions, engagements and forecasts for the use of SAF. Note this chartis not intended to predict the assessment of the AFTF fuel production assessment task force. .16Figure 7.Contributions to the aviation industry's high-level emissions reduction goals (schematic) .20Figure 8.Key (potential) biomass resources and regions for the production of advanced SAF. Source;SKYNRG (2012).23Figure 9.Technical wood fuel potentials in year 2020. Source: DBFZ (2011) .24Figure 10. Technical fuel potential of straw during the period 2003-2007. Source: DBFZ (2011) .25Figure 11. Technical fuel potential of agricultural biomass in year 2020. Source: DBFZ (2011) .26Figure 12. Well to Wing emissions different jet fuel production pathways (gCO 2/MJ), including renewableoptions. Source: White paper on SAF; Prof. Dr. André Faaij (Copernicus Institute, UtrechtUniversity) & Maarten van Dijk (SkyNRG) .28Figure 13. Supply chain cycle of SAF. Source: ATAG .29Figure 14. Evolution of jet fuel price since 2004. .30Figure 15. HEFA production possibilities (output as a % of input weight). Source: MASBI (2013).32Figure 16. Overview comparing the sustainability requirements of the national legislation and voluntaryschemes under review.

Sustainable aviation fuels are still an expensive niche product, and this will only change if demand is encouraged, which in turn requires fuel to become affordable for airlines. This is only possible under a favorable policy framework.