Aviation biofuels financial viability confirmed with new report.
Through ‘bold leadership’, airports can accelerate the adoption of sustainable aviation fuels (SAF) in the aviation industry, according to a newly published report.
The new study, a collaboration between the Carbon War Room, Sky NRG and Port of Seattle, confirms the financial viability of supplying advanced biofuels to all airlines at Seattle-Tacoma International Airport (Sea-Tac).
“Catalysing large-scale uptake of SAF can contribute to the Port’s Century Agenda Goals to reduce carbon emissions and will contribute to the development of clean energy jobs in the state of Washington,” the report states. “Blending SAF into the Sea-Tac jet fuel supply, at a 1 percent level, would reduce CO2 by approximately 23,300–31,000 metric tons annually on a life-cycle basis.”
Co-benefits of using SAF, the external gains associated with the production and consumption of the sustainable fuels, are a particular focus of the report. These co-benefits are seen as crucial to ensuring a transition to the cleaner aviation fuels, allowing airports to overcome the prohibitively high costs of SAF compared to regular traditional aviation fuels.
“The most viable role for the Port in developing the SAF market is to focus on funding SAF co-benefits. By sending a steady demand signal for SAF, the Port will incentivise producers to develop production capacity in the region,” the authors state in the report’s conclusion. “Although the Port cannot use funds to purchase fuel directly, it has historically been able to use funds to support clean air programs. The FAA has shown initial receptivity to the concept that payments for co-benefits may be eligible uses of revenue.”
To raise the estimated $6 million required to enable 1% SAF usage at Sea-Tec, the report suggests a combination of a several mechanisms, claiming no single ‘silver bullet’ is available:
- Corporate Support—corporations contribute to offset their flight emissions ($1 million to $2.5 million per year)
- Port Taxing Authority—these funds support air quality benefits, similar to the Port’s Clean Truck Program ($360,000 to $720,000 per year)
- Use of General Non-Aeronautical Revenue—while there are several individual non-aeronautical fees and revenue sources that could be directed toward SAF co-benefits (such as parking or landside fees), offering non-source specific revenues only when the airport achieves a particular total revenue threshold could create a low-risk, non-targeted source for SAF co-benefit funds ($1.0 to $4.0 million per year)
- Airline Agreement—implement a fund via the airline operating agreement that is not subject to revenue sharing, or create a new fee ($380,000 to $1.5 million per year)
The full report is available from the Rocky Mountain Institute’s website: https://www.rmi.org/insights/reports/innovative-funding-sea-tac-2017/