The Roundtable on Sustainable Biomaterials (RSB) and US-headed renewable fuel producer World Energy LLC have announced a pioneering pilot project to "revolutionize" the sustainable aviation fuel (SAF) market. The ‘Demand Signal Recognition Book and Claim Pilot‘ seeks to develop and test a new methodology and verification system to demonstrate bankable demand signals in SAF transactions. This initiative is expected to enhance the credibility and efficiency of SAF contracting, stimulating further investment and development in the sector.
In the realms of business and supply chain management, a ‘demand signal’ is a critical indicator of the current or anticipated willingness to pay for a product.
Banks and investors assess demand signals as part of financial due diligence, which makes them critical for scaling an industry.
Proof of ‘additionality’
Long-term contracts send a strong demand signal, and they can also play a crucial role as proof of ‘additionality’.
Additionality is an important requirement for voluntary carbon markets (VCM) to prove that an action, like purchasing SAF certificates, generates benefits beyond the status quo.
Recognizing the demand signals of long-term contracts and using them to prove additionality, can help accelerate aviation’s decarbonization and the scaling of the SAF industry.
We are excited to launch the ‘Demand Signal Recognition Book and Claim Pilot‘ in partnership with World Energy LLC. This innovative project is a significant leap forward in enhancing the credibility of sustainable aviation fuel supply chains, and will be instrumental to the decarbonization of hard-to-abate sectors, said Elena Schmidt, Executive Director, RSB.
Develop methodology
This pilot project will develop a robust methodology for demand signal recognition.
This methodology will be validated through stakeholder consultations and piloted in real-life SAF book and claim transactions with World Energy and other partners.
Once finalized, the methodology will be submitted to the RSB Board for approval and inclusion in the next update of the RSB Book & Claim System.
It will also be presented to the wider aviation and shipping markets as a best practice for demonstrating additionality.
The ‘Demand Signal Recognition Book and Claim Pilot‘ represents a critical step forward in the global effort to decarbonize aviation and promote energy transition solutions.
As the project progresses, its findings and methodologies are expected to set new standards for the SAF market, driving further innovation and investment.
This project will help set up a SAF ecosystem that connects suppliers, customers, independent NGOs, and investors. It will also provide proof of additionality and the information banks need to confidently invest in the SAF industry, which is critical to decarbonizing aviation. We’re excited to partner with RSB on this important project, said Adam Klauber, VP of Sustainability & Digital Supply Chain, World Energy.
