Momentum is building in the Asia-Pacific region around improving the sustainability of the aviation sector and the use of sustainable aviation fuels. Major rivals Cathay Pacific and Singapore Airlines have signed a MoU to work together on a range of sustainability measures, while Vietnam Airlines has signed up to IATA’s CO2 Connect platform and recently conducted its first SAF flight, using a blend produced and supplied from Neste’s Singapore refinery. Dubai-based Emirates has also taken its first shipment in Singapore of SAF from Neste. Meanwhile, Air New Zealand has received 500,000 litres of SAF produced in China by Hong Kong energy company EcoCeres and blended by ExxonMobil. Meanwhile, Korean Air is expanding its cargo SAF programme through a new partnership with global logistics company CEVA.

The Cathay-Singapore collaboration was agreed by their respective chief executives at IATA’s recent annual general meeting in Dubai, reiterating the commitment of both carriers to achieve net zero emissions by 2050, and help drive the industry’s shift to more sustainable operations.

The two will jointly press for increased use of SAF across the APAC region and look for opportunities to jointly procure the fuel at specific locations. They will also publicly promote the fuel’s key role in cleaner aviation, advocate for Asia-Pacific governments to enact SAF-supportive policies and urge the creation of a single global accounting and reporting framework to ensure that emission reductions claimed from the use of SAF are both transparent and verified.   

Additionally, Cathay and Singapore will share best practices to reduce single-use plastics, minimise waste and improve energy efficiency in ground operations.

“As part of our collaborative ethos of ‘Greener Together’ we actively seek like-minded industry leaders for strategic partnerships in transitioning to sustainable aviation,” said Cathay’s CEO, Ronald Lam. “Our collaboration with Singapore Airlines aims to accelerate and support the development of the SAF supply chain in the region, fostering a reliable SAF ecosystem to enable the industry to achieve its long-term decarbonisation goals.”

Singapore Airlines CEO Goh Choon Phong said his company was committed to embedding sustainable practices across all areas of the business but added the airline could not achieve all targets by acting alone. “Our partnership with Cathay signifies our mutual ambition to enhance collaboration in sustainability initiatives in the Asia-Pacific region,” he said. “Together we are helping to set the foundation for a more sustainable aviation industry and ensure that future generations continue to reap the benefits of air travel.” 

Also at the Dubai AGM, Vietnam Airlines joined IATA’s CO2 Connect project, through which airlines contribute operational data to the programme’s emissions calculator to help accurately quantify carbon emissions for each passenger by route flown and aircraft type.  Other participants in the programme include American Airlines, British Airways, Cathay Pacific, Japan Airlines, Malaysia Airlines and Qatar Airways, all of which are members of the oneworld global airline alliance.

“Reducing CO2 emissions and promoting sustainable development are top priorities for the global aviation industry,” explained IATA. “However, the measurement and reporting of CO2 emissions have been inconsistent due to the various methodologies used by different airlines.”

The CO2 Connect project creates a common platform for airlines to supply consistent calculation of aircraft CO2 emissions to enable both carriers and passengers to make environmentally informed decisions. The programme uses Recommended Practice Per Passenger CO2 Calculation Methodology (RP-1726), which assesses metrics including airline fuel measurement protocols, the CO2 allocation between passengers and cargo, and cabin class to help ensure the most accurate carbon footprint calculations.

“By participating in CO2 Connect,” said IATA, “Vietnam Airlines underscores its commitment to sustainable development, contributing to the goal of achieving net zero emissions by 2050, as pledged by Vietnam at the 2021 UN Climate Change Conference, COP26.”

In May, Vietnam Airlines conducted its first flight to use sustainable aviation fuel, with an Airbus A321 taking on blended fuel at Singapore Changi for a return flight to Hanoi. Additionally, the airline became the first visiting carrier from the Asia-Pacific region to benefit from SAF produced at the Neste refinery in Singapore.

“We believe that the use of SAF will help create a more sustainable future for the aviation industry, providing passengers with both excellent service quality and environmental friendliness,” said Nguyen Chien Thang, EVP of Vietnam Airlines. “We are collaborating with our partners in the supply chain to expand the use of SAF in the future, thereby contributing to the successful achievement of goals related to net-zero emissions and climate change prevention.”

Emirates too has now started using Neste’s blended SAF in Singapore, produced from sustainably sourced renewable waste and residue raw materials including used cooking oil and animal fat. It is the first SAF procurement by Emirates in Asia and part of a broader global agreement with Neste.

“Emirates’ investment into Neste-produced SAF in Singapore marks a first step forward in our SAF adoption in Asia, a region that is primed to become a leading supplier of SAF, which continues to be in short supply,” said Adel Al Redha, the airline’s deputy president and COO. “While the activation of this agreement marks a milestone in our SAF journey in a new region, there’s still a lot of work to do. And as we procure SAF for the short term, we’ve got our sights set on longer-term agreements to help scale up a steady supply of SAF for our operations.”

The airline also uses SAF on flights from Amsterdam, London Heathrow, Paris, Lyon and Oslo, and late last year integrated SAF into fuelling systems at its home hub, Dubai.

Meanwhile, Air New Zealand has acquired 500,000 litres of SAF produced from used cooking oil in China by Hong Kong headquartered renewable energy company EcoCeres and blended by Exxon Mobil.

The SAF was delivered to Wellington Airport for use in Air New Zealand’s fleet of ATR 72 regional airliners. The carrier says this volume of SAF is sufficient to fuel 165 Airbus A320 flights between the country’s capital, Wellington, and New Zealand’s largest city, Auckland. 

“Airlines are signing supply arrangements for SAF 10 years into the future and beyond,” said Air NZ’s Chief Sustainability and Corporate Affairs Officer, Kiri Hannifin, “so we need to be part of the picture from the start, otherwise New Zealand may fall behind. While the volumes of SAF we are buying are very small compared to the amount of fossil jet fuel we use, they give an important signal to alternative fuel producers that we are open for business.

“We’ve seen increased international momentum around SAF in the past few months, with airlines, governments, airports and fuel companies all getting on board with alternative fuels at pace.

“From 2026, our aircraft will be required to uplift SAF when we fly home from Singapore and Vancouver. Japan has announced a SAF requirement from 2030 and other countries are also making signals that SAF will be mandated for all airlines for outbound flights including in Australia, Indonesia, Hong Kong and China.”

EcoCeres, a business unit of energy supplier Hong Kong and China Gas, operates a waste oil plant in Zhangjiagang, Jiangsu province in China, producing 100,000 tonnes of SAF per year and 200,000 tonnes per year of renewable diesel. The company says it is the world’s first ISCC-CORSIA Plus approved SAF processing facility. It is now planning a second plant in Johor Bahru, Malaysia, that would produce around 350,000 tonnes a year of low carbon transportation fuel.

Following a $400 million strategic investment made in EcoCeres by Bain Capital in 2023, the fast-expanding company earlier this year appointed former Neste CEO Matti Lievonen as its Executive Chairman. He has been joined by another former Neste executive, Phil Moore, who has taken up the position of Global Head of Sustainable Aviation Fuels.

Meanwhile, Korean Air is expanding its cargo SAF programme through a new partnership with global logistics company CEVA.

The logistics group will support Korean Air’s use of SAF for cargo operations, and the airline will reciprocate by sharing carbon emissions reductions with CEVA.

“One of CEVA’s key short-term levers to promote decarbonisation hinges on collaboration,” said Olivier Boccara, CEVA’s Air and Ocean Leader, APAC. “Through developing new solutions for our customers with airline partners like Korean Air we are able to contribute to meaningful change in our industry.

“Extending our SAF offering into the Asian market is a tangible step we can take now as we look ahead to more advances in fuels and other technologies to decarbonise air freight and the global supply chain.”

Photo: Emirates aircraft refuelled with Neste SAF at Singapore Changi Airport

Tony Harrington

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Carriers meeting at the annual Airlines for Europe (A4E) Summit in Brussels called on policymakers to “supercharge” the production of sustainable aviation fuels across Europe through the introduction of competitive tax credits and the funding and support for nascent, emerging and established SAF projects or fuel producers. It is crucial that Europe supports affordable and reliable domestic production, they said in a “call to action”, particularly in the face of significant market pressure from global players outside of Europe. Meanwhile, A4E member Lufthansa Group has reported more than one million passengers have opted for its Green Fares tickets, which includes a provision for SAF offsetting, one year after their launch. European renewable fuels producer Neste has started supplies of blended SAF at Schiphol under an agreement with Emirates, while Sasol and Topsoe have launched their new joint venture Zaffra, located in Amsterdam, that will focus on SAF development and delivery.

At the forefront of A4E’s “call to action” is what it describes as “competitive decarbonisation” in a global market, to ensure Europe is a world leader in aviation’s net zero transformation.

“The next few years provide a real opportunity for change and we are setting out how we want to future-proof flying,” said A4E Managing Director Ourania Georgoutsakou at the opening to the trade body’s Summit in Brussels. “We are today making a pledge to improve the future of flying but can only do this if policymakers make the vital changes to support our decarbonisation efforts, providing real airspace reform, ensuring our sector remains competitive and completing a true single aviation market.”

A4E member airlines have been involved in a number of SAF commitments this month. International Airlines Group (IAG), made up of Aer Lingus, British Airways, Iberia and other carriers, signed a 14-year agreement with US startup Twelve for the supply of 785,000 tonnes of e-SAF, the groups biggest single SAF deal to date and the first e-SAF procurement by a European airline group (see article).

Following its purchase of 500 tonnes of SAF from Austrian energy company OMV last year, Ryanair reported it would take an additional 500 tonnes in 2024. Under an MoU between the two companies, Ryanair has access to purchase up to 160,000 tonnes of SAF during the period to 2030.

Another A4E member, AEGEAN, which first flew with SAF in 2021, is to expand its use of SAF under an agreement with Shell and MOH Aviation, who will supply a “significant” quantity of blended SAF at Stockholm Arlanda and London Heathrow airports. The Greek carrier said this marked the beginning of a gradual expansion of its SAF uplift programme, “where available”, throughout its entire network.

According to Lufthansa Group, an average of 3% of passengers have used its Green Fares tickets, with the tickets being selected by 11% of business class travellers via the Lufthansa Group portals. In total, travellers have offset around 77,000 tonnes of CO2. Offsetting of flight CO2 emissions is through SAF as well as by a contribution to high-quality climate protection projects. The group ensures the amount of SAF required for offsetting is fed into the airport infrastructure within six months of purchase.

Green Fares are available with Lufthansa, Austrian Airlines, Brussels Airlines, SWISS, Edelweiss, Discover Airlines and Air Dolomiti on more than 730,000 flights per year within Europe and to Morocco, Algeria and Tunisia. The group has been testing Green Fares on selected long-haul routes since November 2023.

Meanwhile, Finland-headquartered Neste has launched Neste Impact for businesses looking to reduce the carbon footprint of their air travel and transport activities. The solution is aligned with the Science Based Targets initiative (SBTi), enabling businesses to credibly report achieved emission savings and follows a book-and-claim approach. The related emission reduction achieved is third-party verified and further validated through the ISCC SAFc registry. Neste ensures the SAF is supplied to a partner airline and the purchased amount is verifiably used to replace fossil fuel.

UAE carrier Emirates has activated its fuel agreement with Neste at Amsterdam Schiphol and 2 million gallons of blended SAF will be supplied into the airport’s fuelling system over the course of 2024. The blended SAF will comprise over 700,000 gallons of neat SAF. The airline will track the delivery of SAF into the fuelling system and the environmental benefits using standard industry accounting methodologies.

Global chemicals and energy company Sasol and Danish carbon emission reduction technology specialist Topsoe have launched their joint venture, named Zaffra, which will be based in Amsterdam. The partners say the new company, to be headed by former Shell Aviation boss Jan Toschka, aims to advance SAF production and technologies.

Photo © Lufthansa Group

Christopher Surgenor

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Fresh from hosting the UN’s COP28 global summit on climate change, the government of the United Arab Emirates has announced a guideline that by 2031, at least 1% of total fuel supplied at UAE airports to the nation’s airlines will be locally produced sustainable aviation fuel. Following a post-COP28 cabinet meeting, the government also confirmed the UAE aims to produce 700 million litres of SAF per year by 2030, and that a “national regulatory environment for SAF” would be developed. It was not specified if UAE-based airlines or others would be obliged to use the SAF. However, the government’s National SAF Roadmap to 2050, released last year, lays out a strategy to produce the fuel at up to five facilities in the UAE, plans to become a major SAF exporter and an ambition to become recognised as a global leader in, and authority on, SAF.

The UAE hosted the recent COP28 climate summit and ICAO’s third Conference on Aviation Alternative Fuels (CAAF/3) in Dubai, as well as IATA’s Energy Forum in Abu Dhabi. Countries at CAAF/3 agreed a global framework that included an overall 5% reduction in the carbon intensity of aviation fuel consumption by 2030.

The UAE has six international airlines and eight international airports. Dubai-based Emirates is both the nation’s biggest airline and the world’s largest operator of international flights, eclipsing the Abu Dhabi-based national carrier, Etihad, and low-cost airlines FlyDubai, Air Arabia, Air Arabia Abu Dhabi and WizzAir Abu Dhabi, a partnership with European LCC WizzAir.

Based on scheduled airline seats, global aviation data group OAG has also consistently ranked Dubai as the world’s busiest international aviation hub and the second busiest for total flights, marginally behind Atlanta’s Hartsfield International Airport. Its December 2023 assessment reconfirms this.

The UAE’s 1% SAF Guideline and 2031 timing for deployment at its own airports were outlined in a statement to the official Emirates news agency WAM by Ahmed Al Kaabi, Assistant Under-Secretary for the Electricity, Water and Future Energy Sector at the Ministry of Energy and Infrastructure, and chairman of the UAE Sustainable Fuel Committee.

WAM reported that Al Kaabi had confirmed the policy was “the first of its kind in the Middle East, with a target of having at least 1% of the total fuel supplied at UAE airports to UAE airlines be sustainable and produced locally by 2031. Locally-produced SAF will provide added value and bolster research and development efforts, while utilising cutting-edge technology in producing SAF.”

The statement also advised that the Ministry was working with “competent authorities, including the General Civil Aviation Authority (GCAA), to develop implementation plans to ensure the objectives of the guideline are achieved,” including producing 700 million litres of SAF by 2030.

The 1% SAF stipulation for UAE airports and airlines is conservative when compared with the production potential the country has identified in its National SAF Roadmap, which indicates that commercial production of the fuel could commence by 2025.

The scale and schedule for proposed deployment are also at odds with a string of ambitious announcements by the country and companies within it before and during COP28, and significantly lower than targets in other markets, specifically the European Union, where SAF blending mandates will begin at 2% in 2025, rising to 6% in 2030, then 20% in 2035, 34% in 2040, 42% in 2045, and 70% in 2050. However, the EU mandate, with the UK shortly to set a similar policy, does not specify the SAF used must be locally produced.

Major airlines in many markets have committed that by 2030, SAF will comprise between 5% and 30% of the jet fuel they use, while members of the oneworld alliance have signed up for 10%, and the 14-members of the Association for Asia Pacific Airlines have collectively agreed to 5%, with some independently exceeding that figure.

In the past year, Emirates – whose CEO, Sir Tim Clark, has previously expressed doubts the airline industry will achieve its decarbonisation targets – established a $200 million fund to support sustainable aviation innovation, performed two test flights in which aircraft engines were powered by 100% SAF, and announced multiple highly-publicised deals to procure imported SAF.

While it says little about the nation’s plans to deploy the fuel in its home market, the UAE National SAF Roadmap highlights opportunities to exploit demand for SAF in other markets.

It specifies SAF will be produced at up to five plants in the UAE, using three development pathways: the conversion of oils from saltwater-tolerant plants grown in Abu Dhabi, transformation of municipal solid waste to low emission fuel, and power-to-liquid fuels using solar-generated electricity.

“Some of this production could be exported to make use of more mature policies regimes, for example in the European Union, and allocating half of this supply for export opportunities could provide a cumulative $1.7 billion of export revenue for the UAE by 2030,” says the Roadmap report. “This would further diversify the UAE’s economy and contribute to the nation’s current account surplus.”

Producing 700 million litres of SAF by 2030 would cost between $7 billion and $9 billion but reduce cumulative CO2 by an estimated 4.8 million tonnes and create up to 18,000 jobs “across the value chain”. 

“Aviation is a global industry, and alongside national efforts, the UAE will seek to accelerate the global transition through leadership at ICAO, and support of projects on renewable fuels and energy in other countries,” the report says.

“The UAE’s commitment to SAF development, highlighted by its ambitious roadmap, will put the nation as a global leader within the sustainable aviation transition.

“The UAE is uniquely positioned to lead global discourse on SAF production and utilisation as part of wider climate change action.    

“Beyond COP28, by leveraging its world leading international aviation sector, the UAE can host ICAO, IATA and CAEP (Committee on Aviation Environmental Protection) conferences, reinforcing its position as an authoritative voice within the sustainable aviation movement.”

Image: Emirates

Tony Harrington

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In what ICAO Council President Salvatore Sciacchitano described as the UN civil aviation agency’s most important event of the year, countries are convening this week in Dubai to agree a global framework on a cleaner energy future for aviation. The purpose of the Conference on Aviation Alternative Fuels (CAAF/3) is to steer policy direction and financing to aid the rapid shift towards new forms of sustainable energy, in particular sustainable aviation fuels, to meet ICAO’s Long Term Aspirational Goal (LTAG) of net zero carbon emissions from international aviation by 2050. Sciacchitano said it would be a massive task that required immediate collective action. SAF production remains largely confined to Europe and the USA but the collective global target will require huge support and investment for energy transition in the developing world. The week-long meeting has been marked with an Emirates A380 demonstration flight with one engine powered by 100% SAF.

“We must urgently scale up the development and deployment of sustainable, lower carbon and other clean energy aviation fuels in order to meet the sustainability expectations of both the world and the stakeholders,” said Sciacchitano in his opening address at CAAF/3. “We have a massive task ahead of us this week as we deliberate on the ICAO Global Framework for aviation’s cleaner energy transition, a key step for the sustainable development of air transport. ICAO’s main priority is the implementation and achievement of LTAG. To do this, we need to take collective action now and CAAF/3 can be instrumental in laying the building blocks in terms of policy and planning, regulatory framework adjustments, implementation support and financing.

“This is also an opportunity for States to demonstrate strong leadership in addressing international aviation emissions just before the UN’s COP28 climate change conference also taking place here in the UAE. A successful, robust and ambitious global framework can only serve to shine a bright spotlight on the shared efforts and commitment to decarbonising our sector. We have a great opportunity to show and communicate to the world that aviation is seriously and strongly committed to decarbonise by 2050.”

In a video address, UN Secretary-General Antonio Guterres said aviation was one of the most challenging sectors to decarbonise, “but with innovation and investment, it can be done.”

He added: “A net-zero aviation sector means cleaner energy sources on a global scale. It means economic policies and regulations that can support a just and equitable transition while attracting investors, and it means measures such as carbon pricing, low-carbon fuel standards and subsidies for sustainable aviation fuels. The global framework emerging from this conference is a critical step towards a clean and prosperous future for this vital sector. By moving at jet speed you can speed up the clean energy revolution our world needs.

“With the upcoming COP28, now is the time to turn ambition into concrete action to find ways to deliver on your net zero target and shape a better, cleaner future for all.”

CAAF meetings take place only on a six-year basis, the first held in Brazil in 2009, and CAAF/3 is the culmination of a series of stocktaking and pre-CAAF/3 conferences and consultations to prepare the ground for a ‘2050 ICAO Vision’ for SAF, lower carbon aviation fuels (LCAF) and other aviation cleaner energy sources in order to define a global framework in line with ICAO’s ‘No Country Left Behind’ initiative that takes into account national circumstances and capabilities. SAF, LCAF and other aviation cleaner energies are expected to make the largest contribution towards achieving the LTAG.

The 2050 Vision acknowledges that no single fuel source will be produced at a level necessary to achieve the LTAG and so the framework needs to be flexible and not exclude any particular fuel source, pathway, feedstock or technology that meets the CORSIA eligible fuels criteria, says ICAO.

Since earlier this year, a Small Group for Preparations for CAAF/3, under the Climate and Environment Committee (CEC) of ICAO’s governing Council, has been considering possible CAAF/3 outcomes, including a draft global framework. The framework is built across four interconnected building blocks that need to advance and work together: policy and planning; regulatory frameworks; implementation support; and financing.

Although there has been general convergence on the Vision, some differences remain around aviation cleaner energies and financing, which will be discussed during the conference.

A number of States want to see CAAF/3 emerge with a quantified goal in order to send a political signal of support for sustainable fuels that could unlock private sector investment around the world.

“The reason why investors need this outcome is that it is crucial to assuring the durability of their investments,” US government representative Annie Petsonk said during an opening panel session. “If they are going to make the major investments that allow SAF to be produced in refineries and to develop the required feedstocks and supply chains, they want to see governments are serious about this transition. Through informal consultations I have had already, I am very hopeful that I will be able to communicate a positive outcome to them.”

The US is also supporting the creation of the ICAO Finvest Hub, which aims to act as a facilitating platform to connect projects contributing to the decarbonisation of international aviation, including feedstock and SAF production, with potential public and private investors. A priority of the initiative would be to support developing countries and those with special needs in financing aviation decarbonisation projects. It would also offer technical assistance, capacity building and guidance on the development of legal and policy frameworks.

Industry is also represented at CAAF/3 and has a similar wish list. “There are two key outcomes we would like to see from the conference: a goal for SAF deployment that can provide investment certainty to the finance markets and influence policy actions around the world, and a supportive global framework that will ensure countries everywhere can take advantage of the opportunities to build new energy industries and secure jobs in supplying SAF,” said Haldane Dodd, Executive Director of the cross-industry Air Transport Action Group (ATAG).

ATAG says the transition to SAF is already underway, with policy measures being implemented or discussed in around 40 countries, with $45 billion in forward SAF purchase agreements in place with airlines, operators and corporate partners. Ten facilities are currently producing SAF, it says, but by 2029 over 150 projects in 35 countries are being explored that could be used for SAF production.

“The SAF scale-up has begun,” said Dodd. “Over 10 times more SAF was delivered to airlines in 2022 than in 2019. That pace of development will continue but needs to accelerate significantly to keep in line with the industry’s path to net zero.

“Three things are needed to make the aviation energy transition happen: government policy to support supply and create certainty for demand; financing of the potentially $1.5 trillion in infrastructure capital needed to supply SAF at the scale required; and a serious effort by the traditional energy sector to shift their products from fossil to sustainable fuels. We believe the CAAF/3 meeting can set the scene for these developments and help catalyse the transition in aviation. These are tough decisions and complex challenges, but necessary ones to progress as climate change makes its impacts felt.

“A global framework from CAAF/3 will help capacity building and access to finance so that countries everywhere can build SAF industries of their own. Enormous value can be created in diversifying and democratising energy supply if governments grasp the opportunities ahead of them.”

Added Laurent Donceel, Deputy Managing Director of Airlines for Europe (A4E): “The future of aviation depends on sustainable aviation fuels and it is critical the CAAF/3 meeting produces a global agreement for a net-zero aviation with realistic targets to promote the use of SAF. Global investments in SAF and boosting the energy transition in aviation will create a bounty of jobs and growth around the world.

“Europe and the USA are accelerating down the runway towards a more sustainable future so it’s critically important that the rest of the world keeps up and delivers a truly net zero aviation industry. CAAF/3 is an ideal opportunity to set this in stone.”

Environmental NGOs belonging to the International Coalition on Sustainable Aviation have called on the meeting “to adopt a global aspirational quantified objective for 2050 and an aspirational trajectory that are consistent with the Paris Agreement temperature goals, and that prioritise the environmental and social integrity of alternative fuels.”

Setting the goal, they say, requires adopting, primarily, a metric that focuses on the carbon intensity of alternative fuels on a lifecycle basis, consistent with CORSIA eligible fuels methodology.

“A successful outcome requires focusing on defining an ambitious vision that prioritises the environmental and social integrity of alternative fuels and therefore avoids trading an environmental threat for another,” said a statement presented at CAAF/3. “The focus should always be on quality rather than quantity.”

In addition to a robust sustainability standard, said the NGOs, CAAF/3 should emphasise transparency to ensure alternative fuels are accurately reported and accounted for, with the avoidance of double counting critical for integrity.

The statement notes that whereas the CAAF/2 vision focused solely on sustainable aviation fuels, the scope for CAAF/3 has been expanded to cover not only other cleaner energy sources such as cryogenic hydrogen and electricity, but also lower carbon aviation fuels (LCAF) of fossil origin.

“ICSA believes that while LCAF may have potentially lower carbon emissions on a lifecycle basis, all fuels of fossil origin must, by definition, be regarded as unsustainable. The CAAF/3 Vision should avoid the use of encompassing terms such as ‘sustainable fuels’ and instead use suitable terms such as ‘alternative fuels’.

To coincide with CAAF/3, Emirates this week has become the first airline to operate an A380 demonstration flight using 100% SAF. In a collaboration with Airbus, Engine Alliance, Pratt & Whitney, ENOC, Neste and Virent, the Emirates aircraft took off from Dubai International Airport with one of its four engines powered on 100% SAF. The flight carried four tonnes of SAF, comprised of HEFA-SPK provided by Neste and HDO-SAK (hydro deoxygenated synthetic aromatic kerosene) from Virent. ENOC helped to secure the neat SAF comprised of HEFA-SPK and blended it with SAK at its facility in the airport.

The 100% SAF was used in one Engine Alliance GP7200 engine, while conventional jet fuel was used in the other three engines. The PW980 auxiliary power unit from Pratt & Whitney Canada also ran on 100% SAF. The flight on November 22 was preceded by robust engine testing, with the objective of validating the engine’s capability to run on the specially blended 100% drop-in SAF without affecting its performance or requiring modifications. Ground engine testing took place at the Emirates Engineering Centre in Dubai.

Earlier this year, Emirates completed the first 100% SAF-powered demonstration flight in the region on a GE90-powered Boeing 777-300ER. Shell has supplied Emirates with 315,000 gallons of blended SAF for use at Dubai and the airline currently uplifts SAF in Norway and France. Emirates recently expanded its partnership with Neste for the supply of over 3 million gallons of blended SAF in 2024 and 2025 for flights departing from Amsterdam Schiphol and Singapore Changi airports.

“The growing global demand for lower-emission jet fuel alternatives is there, and the work of producers and suppliers to commercialise SAF and make it available will be critical in the coming years to help Emirates and the wider industry advance our path to lower carbon emissions,” commented Adel Al Redha, COO, Emirates Airline.

Videos of the CAAF/3 proceedings are available on ICAO TV

Top photo: ICAO Council President Salvatore Sciacchitano addresses CAAF/3

Emirates A380 100% SAF demonstration flight:

Christopher Surgenor

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Emirates will acquire more than 300,000 gallons (1.14 million litres) of blended sustainable aviation fuel from Shell Aviation, with supplies flowing to the airline’s home base, Dubai International Airport, by the end of this year. As part of the agreement, Emirates will track delivery and its use data through the blockchain-powered SAF solution Avelia. The SAF will be the first delivered through the fuelling system at the airport, the world’s largest international hub. The deal follows a demonstration flight earlier this year by an Emirates Boeing 777 with one engine 100% fuelled by SAF, and the airline’s establishment of a $200 million investment fund to support R&D into projects designed to reduce the impact of fossil fuels in aviation. Dubai will next month host the Dubai Airshow, the third ICAO Conference on Aviation and Alternative Fuels and the UN’s COP28 climate summit.

The SAF deal coincides with the reactivation after Covid-19 of most of Emirates’ passenger fleet of Airbus A380s and Boeing 777-300ERs. It is the largest operator of both types, with a large proportion of its flights on long-haul routes, for which SAF is considered the only realistic pathway to decarbonisation.

While details of the Shell agreement, including the source of the fuel, feedstock type and delivery schedule were not disclosed, the companies said Emirates would purchase the SAF and the associated environmental attributes through the Avelia programme operated by Shell Aviation and Accenture, which authenticates and documents SAF from production to introduction into airport fuel infrastructure.

Additionally, backed by Energy Web and American Express Global Travel, Avelia connects airlines and the procurement arms of corporations, enabling those businesses to contribute to the cost of SAF through an authenticated book-and-claim process, to help compensate for the proportion of flight emissions generated by their employees’ business travel.

As well as enabling Emirates to reduce its Scope 1-related emissions from flight operations, the Scope 3 environmental attributes associated with the fuel will be purchased by Shell Corporate Travel, not only to help recompense emissions from corporate flying by its own employees, but also to demonstrate how book-and-claim programmes can connect airlines and corporations, and enable both to leverage the environmental benefits of SAF.

Sir Tim Clark, Emirates’ President – who has previously expressed doubts about aviation’s ability to achieve net zero emissions by 2050 – welcomed the Shell deal and flagged more SAF agreements.

“We are proud to work in partnership with Shell to make a SAF supply available for Emirates in Dubai for the first time,” he said, “and to utilise the Avelia platform that provides business travellers the flexibility to align their sustainability targets and reduce their environmental footprint when travelling.

“We hope that this collaboration develops further to provide an ongoing future supply of SAF at our hub, as there are currently no production facilities for SAF in the United Arab Emirates.

“Aviation plays a vital role in Dubai and the wider UAE economy, and we look forward to continue collaborating with like-minded organisations and government entities to look at viable solutions that introduce more SAF, a fuel that is currently extremely limited in supply, into the aviation fuel supply chain and support Emirates’ efforts to reduce emissions across our operations.”

Chu Yong-Yi, VP of Shell Corporate Travel, said the Emirates SAF deal was a step forward for aviation in the UAE, adding: “Emirates and Shell have a long-standing commercial relationship, and it is fantastic to build on this to now work together on decarbonisation.

“Enabling SAF to be suppled at DXB (Dubai’s main airport) for the first time is an important milestone, and a perfect example of how the different parts of the aviation value chain have a role to play in unlocking progress on SAF. We hope that this can act as a springboard for more action on SAF across the aviation industry in the UAE and region, delivering another step forward for our net zero emissions journey.”     

 In May, Emirates announced a three-year, US $200 million commitment  to fund research and development projects which focus on reducing the impact of fossil fuels in the aviation industry. The airline specifically identified partnerships with organisations focused on advanced fuel and energy technologies. 

Announcing the programme, Clark said Emirates “looked long and hard at the reality we face in commercial aircraft and engine technology, fuel supply chain and our industry’s regulatory and eco-system requirements. It’s clear that with the current pathways available in terms of emissions reduction, our industry won’t be able to hit net zero targets in the prescribed timeline.

“We believe our industry needs better solutions, and that’s why we’re looking to partner with leading organisations on R&D. Our aim is to contribute meaningfully to practical solutions for the long-term sustainability of commercial aviation.”

The airline has contributed to the development of the UAE’s Power-to-Liquid fuels roadmap and participated in the UAE’s National Sustainable Aviation Fuel Roadmap launched in January.

While it has previously used SAF to part-fuel specific flights including new aircraft deliveries, Emirates has focused mostly on large-scale fleet renewal and operational initiatives to reduce flight emissions. It has more than 200 new widebody jets on order, including Airbus A350, Boeing 787 and 777X passenger jets, and a mix of new 777 freighters and passenger-to-freight conversions.

Image: Emirates

Tony Harrington

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United Airlines, the world’s third-biggest carrier by flight frequencies, expects to use 10 million gallons of sustainable aviation fuel this year, triple its 2022 volumes, following new agreements to introduce blended product at San Francisco International and London Heathrow airports. It already uses SAF at Los Angeles and Amsterdam, and has invested in the future production of more than 5 billion gallons through both offtake agreements and equity stakes in emerging SAF producers. The airline has just uplifted its first blended SAF from San Francisco and will add London later in the year when supplies become available there. United has also announced the addition of eight new partners to its Eco-Skies Alliance programme, through which corporations contribute to the airline’s SAF purchases to help offset the emissions of flights by their own employees. The latest sign-ups take to 24 the number of corporations participating in the programme, an increase of 50%.   

The use of SAF is a key pillar in United’s programme to achieve net zero carbon emissions by 2050 without the use of conventional carbon offsets, it says, which the airline’s CEO, Scott Kirby, has criticised as irrelevant to reducing flight emissions. It claims to have been the first airline to commit to net zero 2050 without relying on offsets.

Through investment vehicles established to support companies and technologies which can help to decarbonise air travel, United has also bought into emerging manufacturers of electric, hybrid-electric and hydrogen-electric propulsion systems, announced provisional orders for zero-emission powertrains, commuter planes and air taxis, and purchased a stake in Natron Energy, a company which produces high-density, fast-charging batteries to power electric vehicles and equipment at airports.

“In just a few years United has exponentially increased its SAF use,” said Lauren Riley, the company’s Chief Sustainability Officer. “While 10 million gallons of SAF in 2023 represents a fraction of what we need, we have also made big investments in producers that are using everything, from ethanol to algae, to CO2, to help increase our available future supply. We believe these investments, along with our continued collaboration with policymakers, cross-industry businesses and other airlines, will help us scale this brand-new industry to achieve comparable success to solar and wind.”

The airline’s SAF use in 2023 is expected to be three times last year’s total, and 10 times the uptake in 2019. Last month, as part of its increase in SAF use, United received 1.5 million gallons at San Francisco International from European renewable fuel company Neste, which also supplies the airline in Amsterdam. That fuel is manufactured using renewable waste and residue raw materials including used cooking oil and animal fat waste.

United will begin using SAF at Heathrow later this year, the first time the airline has participated in the airport’s SAF incentive programme. After delivering its first SAF to airlines in June 2021, Heathrow introduced the incentive scheme last year, through which it covers up to 50% of the extra cost of SAF to encourage demand from airlines. Last year, it achieved its target of 0.5% blended SAF use and this year it is aiming for 1.5%. By 2030, Heathrow wants SAF to comprise 11% of the aircraft fuel used at the airport, rising to at least 80% by 2050 and potentially 100% if sufficient supplies are available of synthetic aviation fuels, or e-fuels.

The SAF used by United is part-funded by the proceeds of its Eco-Skies Alliance programme, which was launched in April 2021 as both a SAF financing mechanism and an effective option for corporations to help compensate for their air travel emissions. United said since the programme’s inception, it had contributed to the airline’s purchase of almost 15 million gallons of SAF, 50% more than the 10 million gallons it expects to consume this year. The programme now has 24 participants, including eight new joiners just announced by the airline – Audi, Bank of America, Cisco, Corporate Travel Management, DB Schenker, First Eagle Investments, Macquarie Group and Thermo Fisher Scientific.

But while United continues to invest in both SAF and its producers, its newly-signed commercial partner, Dubai-based Emirates, has expressed doubts that there will be sufficient SAF available to power long-haul flights, which account for most of its operations. This week, at the Arabian Travel Market, a major trade show staged in Dubai, the airline’s CEO, Sir Tim Clark, said fossil fuels would, “for the time being”, remain the dominant energy source for long-haul flights.

In answer to media questions about aviation’s efforts to decarbonise, Clark said there was insufficient funding to produce affordable or sufficient volumes of SAF, echoing continuing global concerns about the continuing high cost of the fuel. “The notion that sustainable aviation fuel is going to crack this terrible nut in the next few years is going to be a very difficult one to answer,” he replied. “We’ve got the tech to do it, but globally the funding is not there to industrialise.”

His comments follow the test flight in January from Dubai of an Emirates Boeing 777 with one of its two GE90 engines powered by 100% SAF, as part of a proof-of-concept demonstration performed in partnership with Boeing, GE Aerospace, Honeywell and two renewable fuel companies, Neste and Virent (see article). The event was described as a key initiative of the ‘Year of Sustainability’ declared by the United Arab Emirates, ahead of Dubai’s hosting later this year COP28 and ICAO’s third Conference on Aviation and Alternative Fuels (CAAF/3).

Photo: United Airlines

An Emirates Boeing 777-300ER has performed a demonstration flight using 100% sustainable aviation fuel to power one of its two GE90 engines. The flight on 30 January was the latest initiative in an industry campaign to secure regulatory approval for flights fully powered by SAF. Currently, the maximum allowed is a 50% blend with conventional jet fuel. It was conducted in partnership with Boeing, GE Aerospace, Honeywell and renewable fuel companies Neste and Virent. The flight, which followed the Dubai coastline for more than one hour, was a key initiative of the ‘Year of Sustainability’ declared by the UAE to highlight what it describes as a commitment to and capability of delivering innovative responses to energy challenges, climate change and other sustainability issues. Emirate’s first flight with blended SAF was in 2017, on a Boeing 777 flying from Chicago, and in 2020 SAF was used to part-power the delivery flight of an A380.

“This is a milestone moment for Emirates and a positive step for our industry as we work collectively to address one of our biggest challenges – reducing our carbon footprint,” commented the airline’s COO, Adel Al Redha, who travelled on the test flight. “Emirates is the first passenger airline in the world to operate a Boeing 777 powering a GE engine with 100% SAF,” he said. “Such initiatives are critical contributors to industry knowledge on SAF and provide data to demonstrate the use of higher blends of SAF for future regulatory approvals. We hope that landmark demonstration flights like this one will help open the door to scale up the SAF supply chain and make it more available and accessible across geographies, and, most importantly, affordable for broader industry adoption in the future.”

The weight and lack of sufficient range for batteries and the immaturity of hydrogen as a near-term source of low emission propulsion, mean SAF is the only viable option to decarbonise large aircraft such as the Boeing 777 or the Airbus A380, both of which Emirates is the largest operator.

To perform the demo flight, the first in the Middle East and Africa to operate with 100% SAF, the airline worked with its partners to procure and develop a blend that closely replicated the properties of conventional fuel. Once a blend ratio was reached which reflected the characteristics of jet fuel, 18 tonnes of SAF were produced for use on the flight.

The SAF was comprised of hydro processed esters and fatty acids and synthetic paraffinic kerosene (HEFA-SPK), supplied by Finland-based Neste, and hydro deoxygenated synthetic aromatic kerosene (HDO-SAK) from US-based Virent. Neste’s ’drop-in’ SAF is mainly produced from waste fats, oils and greases, then blended with conventional fuel, while Virent converts widely-available plant-based sugars into compounds which enable the production of 100% SAF, without a requirement for blending. Virent used its BioForming process to produce the SAK, a critical component that made the 100% SAF possible, as today’s SAF – typically made from used cooking oil or other plant-based oil feedstocks – has to be blended with conventional jet fuel because they lack the aromatics required to meet jet fuel specifications. The Virent product was used to help other 100% SAF-powered demo flights conducted by United Airlines in December 2021 and Gulfstream in December 2022.

“SAF will play a critical role in the aviation industry’s commitment to be net zero by 2050, requiring strong industry collaboration,” said Omar Arekat, Boeing’s VP Commercial Sales and Marketing, Middle East.

Added Aziz Koleilat, VP Global Sales and Marketing for GE Aerospace in the Middle East, Eastern Europe and Turkey: “Collaborations like this to test 100% SAF globally will help bring us closer to this target.”

Honeywell Aerospace, which produces the auxiliary power unit for the Boeing 777, also participated in the Emirates SAF trial. “The APU provides main engine starting, environmental control and emergency back-up systems for the aircraft on the ground and in flight. It uses the same fuel as the main propulsion engines,” said Mosab Alkubaisy, Director of Airlines for Honeywell Aerospace, Middle East. “Currently the APU is certified to run only on 50% SAF, so this demonstration is a big first step in showing full APU functionality and capability when running on 100% SAF.”

Jonathan Wood, Neste’s VP Europe, Middle East and Africa, Renewable Aviation, said sustainable fuel played a key role in cutting aviation’s emissions, “but to fully leverage its decarbonisation potential we need to enable 100% SAF use.” He reported Neste was working closely with partners to speed up the supply and use of SAF as the company prepared to increase its production capacity to 1.5 million tonnes per year with the commissioning of new production facilities in Singapore and Rotterdam. “We look forward to growing the supply of SAF also to Dubai,” he said.

Virent’s President and General Counsel, Dave Kettner, welcomed the opportunity to demonstrate “that we can power sustainable aviation without modifying today’s modern airline engines or the infrastructure that serves the airline industry. Along with our parent company, Marathon Petroleum Corporation, we are committed to meeting today’s energy needs while investing in an energy-diverse future.”

Saif Humaid Al Falasi, Group CEO of the Dubai government-owned Emirates National Oil Company (ENOC), said: “We prioritise working closely with our strategic partners to implement a national roadmap for sustainable aviation fuel. This not only aims to accelerate the decarbonisation of the aviation sector, but also contributes to achieving the UAE’s goals in climate neutrality, enhances the efficiency and conservation of fuel, as well as positions the UAE as a regional hub for sustainable aviation fuel. Playing an active role in supplying Dubai Airports with aviation fuel, ENOC Group is participating in this achievement by securing and blending sustainable aviation fuel, which will help to secure this type of fuel in the UAE in the future.”

Emirates has 134 passenger and freight variants of Boeing 777 aircraft flying 119 routes, from the 349 km Dubai-Muscat sector to the 12,940 km journey between Dubai and Dallas Fort Worth. Aviation data group OAG has just ranked Dubai International Airport as the world’s second busiest global hub in 2022, after Atlanta Hartsfield-Jackson.

Photo: Emirates

Two prominent themes emerged at the 2021 Dubai Airshow: recalibration and decarbonisation. With recovery now underway in the air transport industry, confidence was in abundance, with major orders for passenger and freighter aircraft accompanied by the ubiquitous deployment of the word ‘sustainable’, as the air transport industry zeroed in on net zero, while simultaneously increasing operations post-pandemic, reports Tony Harrington. For the first time outside the United States, Boeing displayed and demonstrated its super-efficient but delayed 777-9 widebody, ordered by major customers including all three big Gulf carriers, Emirates, Qatar Airways and Etihad. The latter announced it was renewing and expanding its Greenliner sustainability programme – currently focused on the airline’s GEnX-powered Boeing 787 aircraft – to include its Rolls-Royce XWB-powered Airbus A350 fleet. Building on its 2020 commitment to achieve net zero by 2050, UAE national airline Etihad revealed during the air show interim targets to reducing emissions intensity and volumes, and signed a number of sustainability-focused agreements.

It announced that by 2025, the carrier would reduce its fleet emissions intensity by 20% and by 2035 it would halve its 2019-equivalent emission volumes, en-route to the net zero 2050 target.

Etihad’s first of five Airbus A350-1000s, which rolled off the production line and into storage prior to the Covid outbreak as the airline restructured its operations, was unveiled at the show in a ‘UAE50’ livery in recognition of the 50th anniversary of the federation of the UAE and Etihad’s net zero by 2050 commitment. Last month, the UAE announced the UAE Net Zero by 2050 Strategic Initiative, making it the first nation in the Middle East to commit to the emissions goal.

Tony Douglas, CEO of Etihad Aviation Group, said “there was no silver bullet, no obvious, single act” that would decarbonise aviation. “It’s going to require the combination and the sum of many different organisations and governments working together for small, incremental improvements,” he said. “Governments and regulators must help the industry to drive innovation for long-term solutions to decarbonising aviation. Support is needed for development of affordable and sufficient supply of sustainable fuels. Optimising flight paths on the busiest routes in the world would prevent untold amounts of CO2 from being pumped into the atmosphere. There is a big opportunity here that doesn’t require any new technology to implement and could be implemented today if there was a will.”

The renewal of the agreement with Boeing and GE will see them exploring opportunities to test new propulsion technologies that lower emissions. The partnership with Airbus establishes a formal framework to collaborate across a number of core areas on Etihad’s A350 fleet to improve environmental performance, specifically the promotion and commercialisation of sustainable aviation fuel, waste and weight management, and the development of data driven analysis. The agreement with Rolls-Royce will look to maximise the potential of the XWB engine as well as targeting the application of electrification technologies and hybrid systems, together with the use of electric motors for commuter aircraft and the emerging urban air mobility sector.

Additionally, Etihad signed MoUs in Dubai to collaborate with UK-based Satavia, which uses data to optimise flight plans and reduce aircraft-generated contrails and CO2, with Tadweer, the Abu Dhabi Waste Management Centre, to jointly explore opportunities to convert commercial, industrial and municipal solid waste into sustainable aviation fuel, and also with The Story Group, to plant mangrove trees in Abu Dhabi’s Jubail Mangrove Park as part of the airline’s carbon offsetting strategy.

Meanwhile, Emirates and GE Aviation also signed a MoU to test fly a GE90-powered 777-300ER with 100% sustainable aviation fuel (SAF) by the end of 2022. John Slattery, CEO of GE Aviation, said the engine manufacturer was committed to developing emission reduction technologies for both in-service and new aircraft, while Emirates COO Adel Al Redha said the partnership was “an important step” towards securing certification of 100% SAF flights.

The airline received its first A380 powered by SAF in December 2020 and, with the support of Swedavia’s Biofuel Incentive Programme, also uplifted 32 tonnes of SAF for its flights from Stockholm earlier that year. Flights from Oslo have also begun operating on SAF under the Norwegian government’s SAF blending mandate policy.

New technologies to improve the sustainable performance of existing aircraft also featured at the Dubai show.

Among them, US-based Universal Hydrogen, which is developing kits to convert conventionally-powered turboprop aircraft to hydrogen-electric propulsion systems, has secured a letter of intent from Acia Aero Leasing for kits to convert 10 ATR-72 aircraft, and options for 20 additional kits for various turboprop types. Universal has developed hydrogen capsules, which can be transported via existing freight networks from hydrogen production facilities direct to airports and loaded into the aircraft they will power.

Lufthansa Technik (LHT) and BASF showcased their Aeroshark surface film, designed to reduce aircraft aerodynamic drag. The product features micro-riblets to replicate the skin of a shark, and initially will be applied to 10 Lufthansa Cargo Boeing 777s from early 2022, reducing carbon emissions by an estimated 11,700 tonnes per year. LHT also signed a MoU with Etihad that will explore digital solutions to further optimise the airline’s technical fleet and operations management, and boost fuel efficiency.

Boeing displayed the latest aircraft in its ecoDemonstrator programme, a Boeing 737-9 on loan from Alaska Airlines, which is being used to evaluate 20 safety and sustainability projects. 

As backdrops to the show, Airbus, Boeing and Embraer all released 20-year forecasts of air travel growth – globally, by region and by segment – with significant but varied predictions of requirements for new aircraft. Airbus estimates that by 2040, 39,000 new-build planes will be needed, 29,700 of them ‘small’ jets such as the narrowbody A220 and A320; 5,300 ‘medium’ A321XLR (extra-long range) narrowbodies or twin-aisle A330neos; and 4,000 large, long-range twins. Boeing goes higher with around 43,000, including 32,660 single-aisle jets, 2,390 regional jets and 7,670 widebodies. Regional specialist Embraer forecasts the need for 10,900 new sub-150 seat aircraft, 8,640 of them jets and 2,260 turboprops. In addition to opportunities to cut operating costs, all cited the need for airlines to decarbonise their operations as one of the key drivers of fleet renewal.

Photo: Dubai Airshow 2021 (© Mark Pilling)

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UAE national airline Etihad Airways has pledged to reduce its CO2 emissions to 50% of 2019 levels by 2035 and achieve full net zero emissions by 2050, which it claims is a first for a Gulf airline and the first in the industry to set a mid-point target towards carbon neutrality. In initial steps towards the goal, Etihad has committed to neutralise the CO2 emissions of its flagship ‘Greenliner’ 787-10 aircraft for a full year of operations in 2021. Separately, the airline will implement an additional voluntary offset programme for passengers via its website booking platform in 2021. Etihad recently launched the first ever aviation ‘transition sukuk’, a form of Islamic sustainability-linked finance, raising $600 million that will support investment in next-generation aircraft and tied to performance in reaching the airline’s carbon reduction targets. In other Gulf news, Emirates has used sustainable aviation fuel (SAF) for the first time to power an A380 delivery flight.

Abu Dhabi-based Etihad has partnered with Respira for its Greenliner carbon offset programme and will initially purchase 80,000 tonnes of CO2 offsets in a Tanzanian forestry project. The Makame Savannah REDD project, developed by Carbon Tanzania, employs a community-based model to curb deforestation and promote better management of local natural resources across over 100,000 hectares in the southern extension of the Tarangire-Manyara ecosystem.

The scheme is verified and certified by Verra under its Verified Carbon Standard to ensure the carbon offsets are quantifiable, additional and fully sustainable. The scheme’s first offset vintages were certified in early November 2020. The Tanzanian project also conforms to Climate, Community and Biodiversity (CCB) Standards, which protect endangered species and local communities.

“Respira offers a fresh approach to the carbon market by aligning the interests of project developers, buyers and capital providers,” said Ana Haurie, CEO of Respira. “In this way, we create win-win outcomes for all stakeholders. It is a privilege to work with Etihad, which has shown real commitment to its sustainability goals through what is a challenging period for the airline industry.”

To support Etihad and Abu Dhabi’s long-term sustainability objectives, Respira will establish operations at the Abu Dhabi Global Market, the emirate’s international financial centre, in order to bring its offset expertise to the Middle East, said the company.

Commented Tony Douglas, Etihad Aviation Group CEO: “It’s encouraging to end a difficult year with such a positive move for the sustainable future of aviation. While the year brought many challenges, sustainability has remained at the top of our agenda, and the work hasn’t stopped. Expect to see more ground-breaking initiatives in 2021.”

Added Dr Alejandro Rios-Galvan, Chairman of the Sustainable Bioenergy Research Consortium (SBRC) at Khalifa University of Science and Technology, who advises the airline on a range of sustainability issues: “This is a great start for Etihad’s zero-carbon journey using a well-respected offset standard that is fully compliant with the best sustainability practices out there. We look forward to continue supporting Etihad on their long-term sustainability strategy.”

The airline said the Greenliner offset programme would complement its ongoing work to develop and test SAFs, with a goal of making them commercially viable for widespread adoption by the industry.

Etihad recently raised $600 million in the world’s first ‘transition sukuk’, a financial instrument enabling organisations to raise funds from investors in accordance with Islamic finance principles. Transition finance supports companies to make progress towards commitments to cut carbon in line with the goals of the Paris climate agreement. The proceeds will be used by the airline for energy-efficient aircraft and research and development into SAF.

According to HSBC, which acted with Standard Chartered Bank as joint global coordinators and joint sustainability structuring agents on the deal, the sukuk also includes a commitment from the airline to pay a penalty in the form of carbon offsets if it fails to meet its short-term target to reduce the carbon intensity of its passenger fleet. Etihad has pledged to reduce its passenger fleet’s emissions intensity by 20% by 2025 from a 2017 baseline.

“Many industries, including airlines, need to undertake complex and gradual transformations to reduce their carbon emissions – and the financial sector has a responsibility to help them,” explained Ali Taufeeq, Director, Middle East Debt Capital Markets, HSBC. “The transition sukuk issuance by Etihad was a natural step in this direction and we are pleased to assist them in accelerating investment in more environmentally-friendly solutions.”

The bank said it is expecting the sustainable finance market to gain further traction over the next few years as more issuers look to source capital more sustainably. It has set up a dedicated environmental, social and governance (ESG) Solutions Unit with an ambition to provide between $750 billion and $1 trillion in sustainable financing and investment by 2030. Transition finance is any form of financial support that helps high-carbon companies start to implement long-term changes to become greener, says HSBC, and bridges the gap between traditional and sustainable financing as businesses begin the journey to net zero.

The Etihad transition sukuk follows the first aviation financing linked to the UN Sustainable Development Goals it raised in December 2019.

“By issuing a sustainability-linked sukuk, Etihad is voluntarily adding to its existing commitments under CORSIA and also committing to reduce its carbon intensity,” said Adam Boukadida, Chief Financial Officer, Etihad Aviation Group.

Meanwhile, Sir Tim Clark, President of rival Emirates, said his airline remained dedicated to sustainability and reducing its environmental impact.

“We are watching developments in sustainable aviation fuel very closely and we look forward to a time when it can be produced at scale and in a cost competitive manner. Our latest A380 delivery flight was partially powered by SAF and this is a positive step towards reducing our overall emissions,” he commented.

The SAF for the delivery flight was produced in Finland by Neste from used cooking oil. Emirates said it continued to support a number of SAF initiatives and is part of the Steering Committee of the Clean Skies for Tomorrow Coalition, established by the World Economic Forum to promote the development of SAF. Along with Etihad, it recently supported a series of webinars (Sustainable Aviation Fuels Initiative for the United Arab Emirates) on the future of SAF in the UAE hosted by Khalifa University. A third of Emirates’ crew transportation buses in Dubai currently are powered by biofuels, with one of its contractors, Al Wegdaniyah, adopting biofuel supplied by Neutral Fuels.