Australian national air carrier Qantas Group and Airbus will invest up to US$200 million to accelerate the establishment of a sustainable aviation fuel (SAF) industry in Australia, in a landmark agreement.
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Qantas Group CEO Alan Joyce said the Australian Sustainable Aviation Fuel Partnership investment would accelerate the development of SAF in Australia, creating value for shareholders of both companies while also creating jobs and reducing the nation’s dependence on imported fossil fuels.
The use of SAF is increasing globally as governments and industry work together to find ways to decarbonize the aviation sector. Without swift action, Australia is at risk of being left behind. With this investment, Qantas and Airbus are putting our money where our mouth is and betting on the innovation and ingenuity of Australian industry, Alan Joyce said.
Due to the lack of a local commercial-scale SAF industry, Australia is currently exporting millions of tonnes of feedstock every year, such as canola and animal tallow to be made into SAF in other countries.
The increased use of sustainable aviation fuels will be a key driver to achieving net-zero emissions by 2050. But we can’t do this without viable industrial systems to produce and commercialize these energy sources at affordable rates and near key hubs around the world. This is especially true for a country like Australia, which is geographically distant and highly reliant on aviation to remain connected both domestically and internationally, said Guillaume Faury, CEO of Airbus.
The Qantas Group, which has committed to using 10 percent SAF in its overall fuel mix by 2030, is sourcing SAF overseas. This includes 15 percent of its fuel use out of London, UK currently, and 20 million litres each year for flights from Los Angeles and San Francisco in the United States to Australia from 2025.
Aviation is an irreplaceable industry, especially for a country the size of Australia, and one that’s located so far away from so much of the world. Future generations are relying on us to get this right so they too can benefit from air travel, Alan Joyce said.
Invest in locally produced SAF
Sustainable fuels cut greenhouse gas (GHG) emissions by around 80 percent compared to traditional kerosene and are the most significant tool airlines currently have to reduce their impact on the environment – particularly given they can be used in today’s engines with no modifications.
The Qantas and Airbus partnership will invest in locally developed and produced SAF and feedstock initiatives.
This investment will help kickstart a local biofuels industry in Australia and hopefully encourage additional investment from governments and other businesses and build more momentum for the industry as a whole, Alan Joyce said.
Projects will have to be commercially viable and meet a strict set of criteria around environmental sustainability.
It makes a lot of sense for us to put equity into an industry that we will be the biggest customer of. We’re calling on other companies and producers to come forward with their biofuel projects. In many cases, this funding will be the difference between some of these projects getting off the ground, said Alan Joyce.
Work with propulsion tech suppliers
Airbus and Qantas agreed to work together on the sustainability initiative as part of the airline’s recently announced orders, including the A350-1000 to operate Project Sunrise non-stop flights from Australia to New York and London and the selection of the A220 and A321XLR under the Qantas Group’s Project Winton’ domestic fleet renewal, as well as lower emission aircraft for its subsidiary Jetstar.
Ensuring a sustainable future for our industry has become the priority for Airbus and we are taking up this challenge with partners across the world and from across all sectors, Guillaume Faury said.
The new fleet will offer a significant reduction in fuel consumption and carbon emissions of up to 25 percent from day one and are all already certified for operation using 50 percent SAF.
The Australian Sustainable Aviation Fuel Partnership reflects the new level of partnership between Airbus and the Qantas Group and our firmly shared commitment to act as catalysts of change to ensure a bright future for our industry, said Guillaume Faury.
The partnership is initially for five years with options to extend the duration. Qantas’ financial contribution to the Australian Sustainable Aviation Fuel Partnership includes AU$50 million previously committed to the research and development of SAF in Australia.
Pratt & Whitney, whose GTF engines were recently selected by Qantas for their new A220 and A320neo family aircraft, is also contributing to the venture.
The company supports the greater use of cleaner, alternative fuels including SAF, while continually advancing the efficiency of aircraft propulsion technology.
New offset program
Qantas has started a process of talking to its major corporate customers about their interest in accessing SAF offsets for their organization’s flying.
This input is shaping the design of a program that could also be extended to individuals in an expansion of the existing offsetting program Qantas already has in place.
This new program is expected to launch later this calendar year.
The aviation industry also needs the right policy settings in place to ensure the price of SAF comes down over time so that the cost of air travel doesn’t rise. We’ve had some encouraging discussions with the incoming Australian Government given their strong focus on emissions reduction and look forward to that progressing, ended Alan Joyce.
