Japan’s top airline confronts hurdles in sustainable fuel drive

Japan’s largest airline has signed up for jet fuel made from renewable materials in Singapore in a small step toward more environmentally friendly travel that will add costs for an industry crushed by the coronavirus. ANA signed a preliminary agreement to start buying so-called sustainable aviation fuel from a Singapore refinery run by Finland’s Neste Oyj. The deal will be expanded from 2023 when Neste will have capacity to produce 1.5m tons of SAF a year, ANA said. The Singapore plant is being enlarged to meet increased demand for diesel and jet fuel produced from waste vegetable and animal fats and oils. Airlines can’t ignore the inevitable shift toward biofuels triggered by campaigns to tackle the effects of aviation on the environment, Hiroaki Sugimori, who manages ANA’s sustainability department, said in an interview. The “Greta effect” -- a reference to climate change campaigner Greta Thunberg -- means airlines must adapt even if it involves higher fuel costs. “We can’t ignore this when we think about the reputational risk,” Sugimori said. Japanese PM Yoshihide Suga set an ambitious target for his country to become carbon neutral by 2050 in his first policy speech to parliament since taking office as premier last month. However, the timing for a shift to higher-cost, sustainable fuel could hardly be worse for airlines struggling to cope with the pandemic. Beyond the industry’s struggle to survive, any shift to sustainable aviation fuel will be hampered by scarce supply. “There are a limited number of producers for SAF compared to the demand,” said Kohei Yoshikawa, manager of ANA’s fuel procurement department. “As we looked into it, we began to realize that it’s not easy to get.” In a test, ANA received on Saturday its first cargo of 7m liters shipped from one of Neste’s European refineries to Haneda airport near Tokyo. Story has more.<br/>