The airlines: who’s doing what in aviation biofuels?

October 19, 2015 |

up-up-and-awayWho’s a Major Player, who’s a Pioneer, who’s committed, who’s monitoring the space as a stakeholder? We look at 45 airlines and their efforts in bringing low-carbon fuels to the marketplace.  

What are airlines and jet manufacturers doing to foster aviation biofuels? Quite a bit — in some cases,  just about all they can given the rough shape of most airline balance sheets in recent years.

The activity includes participation in a number of research consortia and industry goal-setting (such as IATA’s 50% reduction in greenhouse gas emissions by 2050) — but dozens of airlines have taken individual steps beyond these.

There’s good reason to do so. IATA’s 2050 goals might seem comfortably far-off, jet manufacturers typically take 10 years to develop a new jet (or longer — take for example the Boeing Dreamliner, now just arriving in the marletpace after being first unveiled in 2003). And airlines want 20-25 year lifespans for their aircraft.

Putting those two together, it’s fair to say that designs for aircraft that will be in everyday, major airline operation in 2050 air already in development, and any advanced jet technology not in development by 2025 will not have a major impact on 2050 emissions targets.

With no major design breakthroughs being brought to market— but rather incremental improvements that might yield 20% greater carbon efficiencies — airlines aren’t going to be able to grow in revenue passenger miles without a substantive deployment of aviation biofuels, and meet their self-imposed emissions cap.

Hence, all the activity. (But, readers note, lots of activity goes on behind the scenes and the lack of “news flow” doesn’t always mean nothing is going on).

Who’s doing what?

Generally speaking, here are the three categories

1. International carriers. Generally, the activity is here. The investor class — British Airways, Cathay Pacific, Qatar Airways, SAS and United Airlines, are all in this group. Not only do they have more revenue passenger miles, they have more risk from carbon regimes which threaten to regulate them under carbon scheme at takeoff, another in fly-over, and a third one on landing. 11 in total have announced customer agreements to date.

2. Domestic full-service carriers. Generally, these make up the customers, along with the international carriers. The exception here are Fedex and Southwest, which have announced a signature offtake deal with Red Rock Biofuels despite Fedex not carrying carbon-conscious passengers and Southwest being focused on cost, cost, cost.

With the occasional exception, the airlines that have progressed to testing or customer agreements have been at least domestic full-service carriers.

3. Low-cost carriers. With Southwest as a striking exception, these have avoided doing much on biofuels so far — with attitudes ranging from “fast follower” to “wait and see” or even, in some cases, outright skepticism and hostility. Recently Ryanair CEO Michael O’Leary derired aviation biofuels as “a PR stunt,” and described the production of jet fuel from food crops as “nuts” — apparently, not being clued in by his management team that no one is making jet fuel from food crops, anyway. He described biofuels flights as “”appeal to some middle-aged, middle-classed person worrying about the future,” and said that .”nobody is flying around the world on aircraft powered by biofuel.”

There are four levels of intensity when it comes to aviation biofuels activity:

Major player – Investor. In some cases, airlines have taken the fourth step to vertically integrate into the supply chain, by making direct investment into fuel-production technologies. Investments have been both in projects and in technology providers, and typically airlines have stated that they are aiming to accelerate the timelines for aviation biofuels given the limited interest in investment outside of government and customer groups such as airlines and aviation manufacturers. British Airways, Cathay Pacific, Qatar Airways, SAS and United Airlines have taken this step.

Pioneer – Customer. The third step is becoming a regular customer for aviation biofuels — either via regularly scheduled commercial flights, or through long-term offtake agreements. Regularly scheduled commercial flights generally focus on blends of 2-50 percent and are limited either to specific routes or project timelines, owing to the cost and availability of aviation biofuels at this early stage of development and deployment. Aeromexico, Alaska Airlines, British Airways, British Midland, Cathay Pacific, FedEx, Finnair, Gol, KLM, Lufthansa, Qatar Airways, SAS, Southwest Airlines, and United Airlines have progressed to this step, or beyond.

Committed — Test Partner. Typically, interest advances towards test flights, usually in cooperation with aircraft manufacturers such as Boeing, Airbus, Embraer or Bombadier. These can include flights with or without passengers — the defining factor is that they are limited in scope to demonstration of technology rather than regular commercial operation. 30 airlines have proceeded to this step, or beyond.

Low-level — Stakeholder. Activities generally begin with expressions of interest — often joining a group such as the Sustainable Aviation Fuel Users Group, or forming R&D partnerships. Sometimes, they take the form of “being seen to do something”, but often involve extensive R&D efforts including feedstock development, and project feasibility work. There are 45 airlines or airline groups around the world who have taken this step (or gone on to more intensive engagement), to date, as tracked by The Digest.

The remainder of our coverage — Investor-Class, Customer-Class, Test Partner-Class, Stakeholder-Class — continues using the page links below.

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