Cathay Pacific: sustainable aviation fuel needs Hong Kong government push

More government pressure is needed for Hong Kong’s aviation sector to meet its climate goals, even as uptake of sustainable aviation fuel (SAF) has risen from a low base thanks to corporate support, according to Cathay Pacific. “Regulators have a key role to play for a level playing field, so that every [player] is doing the right thing for society,” Grace Cheung, the flagship carrier’s general manager of sustainability, told the Asia Securities Industry and Financial Markets Association’s sustainable finance conference on Wednesday. “If we leave it to the market, every company will wait for their competitors to make the first move.” Aviation is difficult to decarbonise due to the industry’s long innovation cycles, the prioritisation of safe operations and the high costs of key technologies, consultancy McKinsey said last year. SAF is three to five times more expensive than conventional jet fuel, according to industry media outlet AvBuyer. Policies are needed to grow SAF demand and encourage the development of a supply chain financed through grants, loans and a revenue mechanism, Cheung said. In his policy address last month, CE John Lee Ka-chiu committed to formulating a plan to establish an SAF supply chain and to setting a usage target for Hong Kong by next year to cater to rising demand from international airlines. Cathay aims to have SAF make up 10% of its fuel consumption by 2030, compared with 0.03% last year, which Cheung attributed to limited global supply. The 2030 target is achievable based on SAF mandates or targets that governments globally are expected to implement, she told the Post. “Regulated SAF usage policies have been announced in the European Union, Britain and Singapore, while policy discussions are ongoing in South Korea, Japan, Indonesia, Thailand, Malaysia and mainland China,” she said, adding that she is encouraged by rising financial support from Cathay customers that have their own emissions targets.<br/>