It seems logical that switching over time to aviation fuel with a lower carbon footprint would represent the most practical way for the global airline industry to reduce its greenhouse gas (GHG) emissions. But for that change to happen, there needs to be an economic rationale for producing sustainable aviation fuel, and despite an apparently generous production credit for SAF in the Inflation Reduction Act (IRA), that rationale is somewhat unstable compared to renewables. Diesel Credits (RD) available today. In today’s RBN blog, we conclude our two-part series on SAF with an examination of the economics of RD and SAF (which are remarkably similar), the degree to which existing SAF incentives may fall short of RD and what all this means for SAF producers and production.
As we said a Part 1, jet fuel is the third most consumed transportation fuel on the planet (after diesel and gasoline) and its considerable volume (7 Mb/d) is a significant target for reducing carbon emissions. Many airlines have set themselves “net zero by 2050” goals, which can be difficult to understand given the nature of an industry that relies on transportation fuels. If they are to have any degree of success in approaching their goals, come down Scope 2 Emissions through increased use of SAF will be critical, especially given the recently built-up skepticism about the airlines’ other decarbonisation strategy: carbon offsets.
Like RD, SAF is the chemical twin of its petroleum-based alternative and can therefore serve as an “inclusive” replacement. We also explained the processes most often used to produce RD, and from it, SAF. The most mature technology for producing RD from vegetable oils or other recycled fats uses hydrogen to remove oxygen (mainly hydrodeoxygenation or HDO) to produce esters and hydroprocessed fatty acids (HEFA). This same HEFA process can be used to produce SAF (which contains the same molecules as jet fuel from petroleum) by adding a hydrocracking processing step. SAF molecules are shorter chains of hydrocarbons; therefore, the diesel-sized molecules in RD must be broken (or “cracker”).
