Sustainability

HOW TO SUCCESSFULLY SCALE UP SUSTAINABLE AVIATION FUEL SOLUTIONS

Sustainable Aviation Fuel (SAF) is currently the best option for reducing aviation emissions, but the high cost remains a big barrier to widespread adoption. Partners across the aviation value chain are now joining forces to fund the purchase of SAF and help decarbonize the transportation sector. Here’s a look at one alliance with an ambitious plan.

Cracking the SAF ‘chicken and egg’ problem

SAF have been identified as one of the key elements in helping achieve the ambitious emissions reduction goals. © IATA

Expanding the use of sustainable aviation fuel (SAF) is currently facing the classic ‘chicken and egg’ challenge. Over 300,000 flights have used SAF since 2016, but it still accounts for only about 0.01% of the jet fuel market. That’s because the cost remains far too high, which keeps demand far too low. Producers need capital to invest in new production capacity and reach a scale that competes with existing fossil fuels. Most shippers are unwilling or unable to pay the price premiums necessary to fund these investments.

The problem is we need SAF right now because there are few real alternatives. Limiting global warming to well below 2°C, as outlined in the Paris Agreement, and increasing ambitions to limit it to 1.5°C compared to pre-industrial times requires every industry to decarbonize – and transportation is falling behind. Battery technology is not ready for long-distance commercial flights, which cause the majority of emissions. And hydrogen power is not mature enough to replace jet engines in larger aircraft. SAF is the best option we have to scale up sustainable aviation fuel solutions and reduce air transport emissions now.

How can we solve this problem? The answer is by joining forces with like-minded companies and organizations. Led by the World Economic Forum (WEF), the Clean Skies for Tomorrow Coalition (CST) brings stakeholders together across and beyond the aviation value chain to align on a transition to SAF and ultimately achieve carbon-neutral flying. The project is part of the WEF’s Shaping the Future of Mobility platform.

Now the WEF, in collaboration with PwC Netherlands and RMI, has developed a white paper introducing the Sustainable Aviation Fuel certificate (also known as SAF certificate or SAFc) as a workable solution to drive a voluntary market that will unlock new revenue and accelerate SAF production capacity. And we’ve joined United Airlines’ Eco-Skies Alliance program to help fund the purchase of SAF and utilize a ‘book and claim’ mechanism and test the SAF certificate concept.

Primary benefits of Sustainable Aviation Fuel

IMMEDIATE ACTION

To keep global warming well below 2°C, it’s critical to reduce emissions between now and 2030 (according to IPCC).

SCALE

Potential to increase global SAF production to cover 10% of the jet fuel market by 2030, if suitable investments are made.

AVIATION VALUE-CHAIN

SAF is the only “in-sector” climate solution for the air transport sector.

DROP-IN FUEL

SAF can be used right now in today’s aircraft, most of which will be operational for decades.

How do sustainable aviation fuel certificates work?

SAFc is modeled after energy attribute certificates (EACs), which helped enable the power of markets to drive change and accelerate demand for renewable energy. Energy consumers can’t control the source of the energy piped into their homes. The same goes for people who purchase passenger seats or air cargo services: they have no control over the fuel pumped into the aircraft that takes them on vacation or carries their goods to market. Corporations and individuals can purchase sustainable aviation fuel certificates to achieve their climate goals while simultaneously funding the ramp-up of SAF production.

So, how exactly do sustainable aviation fuel certificates work? Fuel producers generate an SAFc for each metric ton of SAF produced from sustainable feedstock. They sell the physical fuel and the virtual energy attributes as SAFc. Aircraft operators receive the fuel and claim the value of the direct emissions reduction (Scope 1). Air transport customers can buy the value of the indirect emissions reduction (Scope 3). All this will lead to more investment in SAFs and ultimately scale up sustainable aviation fuel solutions.

What is ‘book and claim’?

A sustainable aviation fuel certificate is a virtual solution to a physical problem. It’s nearly impossible to track the journey of SAFs from production to the airplane – and creating a separate, end-to-end supply chain for SAFs would be an extremely costly logistical nightmare. 

‘Book and claim’ is a digital system used to track and transfer the emissions reductions from sustainable fuels across the value chain. By buying and selling SAFc, companies can own SAF attributes without physically tracing the fuel through the supply chain. The system gives everyone in the industry, regardless of location or size, access to the market.  DHL Global Forwarding is currently piloting this system with select customers and will make it available to all later this year.


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The Eco-Skies Alliance program

To take advantage of this potentially game-changing model, DHL Global Forwarding has joined United Airlines’ Eco-Skies Alliance. This first-of-its-kind program allows us to reduce our environmental impact and help make sustainable aviation the norm. Together with our alliance partners, we’ll purchase the emissions reductions from 3.4 million gallons (12.87 million liters) of SAF in 2021. That will eliminate about 31,000 metric tons of greenhouse gas emissions on a lifecycle basis, compared to the use of conventional jet fuel.

The purchased SAF will be blended with United’s regular aviation fuel, which reduces the carbon emissions of United Airlines flights, many of which carry our customers’ cargo. This way, we achieve genuine carbon reductions and share the benefits with our customers, helping them to reduce their carbon footprint.

Participating in the Eco-Skies Alliance program is one pillar of our carbon insetting strategy, which aims to reduce and neutralize the emissions where they are emitted. The alliance also aligns perfectly with our plans to increase our use of SAFs to more than 30% by 2030, and thereby help scale up sustainable aviation fuel solutions in the transportation sector.

3.4 million

GALLONS SAF PURCHASED IN 2021

31,000 tons

REDUCED GREENHOUSE GAS EMISSIONS

Uniting with United Airlines

DHL and United Airlines have been working together on sustainability initiatives since 2016. Like Deutsche Post DHL Group, United is an active member of the World Economic Forum’s Clean Skies for Tomorrow Coalition. The global airline is also one of DHL Global Forwarding’s key carriers – ranking among the top three in our GoGreen Carrier Evaluation program for many years. The program allows us to evaluate the environmental performance of our partner carriers and give preference to those that score high marks.

Clean operations for climate protection

We can't create a lasting positive impact unless we follow a clear strategy. That's why our roadmap to sustainability focuses on meeting three key commitments: Clean operations for climate protection. Great company to work for all. Highly trusted company.

At DHL, we understand that we alone cannot scale up sustainable aviation fuel solutions and decarbonize air transport, but we can help lead the industry to a sustainable future. Partnerships like these are part of our Sustainability Roadmap and Mission 2050. By working with like-minded partners, we will achieve our goals based on the Science Based Target Initiative (SBTi). We aspire to be a leader in sustainable aviation, which is why we will increase the blend of SAF in our operations to over 30% by 2030 and invest €7 billion through 2030 in clean operations. 

By 2050, we aim to reduce all logistics-related emissions to zero. And we are well underway. Compared to 2007, we have already improved our carbon efficiency by 37%. Our alliance with United Airlines and other efforts to scale up sustainable fuel solutions mark further milestones on this journey.

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