Sustainable jet fuel supply crunch endangers airlines’ climate targets

Airlines could struggle to reach their near-term climate goals, according to Kristof Van Passel, head of procurement operations and development at Cathay Pacific. That’s because the supply of lower-carbon sustainable aviation fuel (SAF) is “coming online slower than anticipated,” said Van Passel during the BloombergNEF summit in San Francisco on Wednesday. Hong Kong-based Cathay Pacific, like most other major airlines, has pledged for 10% of their fuel to be sustainable by 2030. But the supply of SAF is likely to be 30% to 40% below the demand from airlines by the end of the decade, said Van Passel. “And we expect that gap to widen,” he added. The lower-carbon fuel is typically derived from animal fats, used cooking oil and other feedstocks. A number of startups are also trying to make the fuel from sources such as captured carbon dioxide. Reaching Cathay and other airlines’ 10% SAF target in six years is a massive challenge. SAF accounted for 0.03% of Cathay Pacific’s overall fuel consumption in 2022. Globally, SAF is about 0.1% of airlines’ fuel consumption today. Another key challenge will be bringing down the cost of SAF, according to Van Passel, who said the lower-carbon fuels are two to three times more expensive than conventional jet fuel. “Given the magnitude of the cost, it would drive any airline into losses within a matter of months,” he said.<br/>