Australian national air carrier Qantas Group (Qantas) has announced that it has joined forces with five large companies in Australia to show the demand that exists for a local sustainable aviation fuel (SAF) industry in Australia by preferencing it as a way to reduce their carbon emissions.
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On November 11, 2022, the air carrier launched the Sustainable Aviation Fuel Coalition (SAF Coalition) program, with Australia Post, Boston Consulting Group, KPMG Australia, Macquarie Group, and Woodside Energy signing on as foundation members.
Cost contribution
Members will pay a premium to reduce around 900 tonnes of their air carbon emissions each year by contributing to the incremental cost of SAF rather than using traditional carbon offsets.
By doing so, they send a clear message that there is significant demand for SAF, the key driver towards the decarbonization of the aviation industry.
The Coalition will initially contribute to the incremental cost of up to 10 million litres of SAF sourced by Qantas at London’s Heathrow Airport (LHR) in the UK, which represents around 15 percent of the fuel Qantas ordinarily consumes on flights out of London.
From 2025 onwards, a further 20 million litres each year will be sourced out of Los Angeles (LAX) and San Francisco airports (SFO) in California (CA).
Develop local SAF industry
Qantas Group CEO Alan Joyce said the strong demand for SAF from corporate Australia is a key step towards the development of a local biofuels industry.
Air travel is a crucial part of doing business for many companies. Companies need to travel to meet customers, suppliers, and partners, but they also want to reduce their impact on the environment. SAF is a great way to do that, said Alan Joyce said.
Qantas is currently in negotiations with a number of offshore suppliers to source additional supplies of SAF, which is in high demand globally and which the national carrier would prefer to source domestically.
Together with Airbus, the airline committed to investing up to US$200 million in June 2022 to get a local SAF industry off the ground, including equity funding for new feedstock and refining projects.
The foundation members will also receive enhanced reporting on the emissions from their flying activity and employees will get fast-tracked access to Qantas Frequent Flyer’s Green Tier program.
Qantas will continue discussions with a number of other companies looking to join the Coalition.
The demand for SAF has never been higher but supply is lagging well behind, particularly without a local industry in Australia, and that’s keeping prices several times more expensive than traditional jet kerosene. The more leading corporates that join our program/coalition the more feasible a local industry becomes and the more cost-effective the fuel becomes, Alan Joyce said.
The Qantas Group has committed to using 10 percent SAF in its overall fuel mix by 2030 and approximately 60 percent by 2050.
The SAF Coalition will extend its existing corporate offsetting program, Future Planet, which enables companies to offset emissions through certified, high-quality projects in Australia and overseas.
