Australia is behind most of the world in the production and use of sustainable airline fuel (SAF) and has this week asked Canberra to back the sustainable aviation fuel industry saying it is vital for carbon reduction targets and should help farmers
Qantas has called on the federal government to consider mandates and subsidies for producers of sustainable aviation fuel to get a domestic industry off the ground, saying it could generate $13 billion a year by 2040 and provide a boost for cane farmers.
The Australian Financial Review carries the story today (December 12) explaining SAF, which comes from non-fossil sources, is a direct alternative to jet kerosene. It can be made from biogenic sources such as used cooking oils, council waste, plant oils and agricultural residues, including byproducts from sugar cane.
Andrew Parker, chief sustainability officer at Qantas, told AFR tht zero emissions technology for commercial aviation, such as electric aircraft or green hydrogen, was still decades away, so sustainable aviation fuel remained the key tool for decarbonising and could reduce lifecycle carbon emissions by up to 80%.
Qantas has urged the federal government to provide capital support to kick-start new production facilities, implement a production incentive linked to carbon reduction from fuel to allow domestic producers to compete with overseas companies, and provide tax incentives and credits to sustainable aviation fuel producers.
A report produced by ICF consulting and commissioned by Qantas found that $4 billion of investment for these policies could provide a $12.3 billion return within 16 years.
“Australia is certainly behind … compared to the United States, Europe, particularly Scandinavia, Japan, Canada and even Turkey … policies are developing thick and fast right now. So it will be a fight for capital,” Mr Parker told The Australian Financial Review.
The airline is calling for sustainable aviation fuel mandates in domestic jet fuel supply of 5 per cent by 2030 and 28 per cent by 2040.
It says: “The use of SAF is increasing globally – particularly in Europe, the UK, and the US – as governments and industry work together to find ways to steadily decarbonise the aviation sector through government fuel subsidies, SAF blending mandates, financial incentives (subsidies and tax incentives) and additional project-based funding such as capital grants and loans.
“Qantas has a number of initiatives in train to help kickstart a Domestic SAF industry, including our $400 million Climate Fund, and Corporate SAF program.
“The Group is part of the Federal Government’s Jet Zero Council and continues to advocate for a SAF blending mandate as part of a broader framework of industry policies, similar to those already announced in other jurisdictions.”
