British SAF industry gets a boost
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With decarbonisation key to accelerating expansion plans, the Government has also announced an additional £400,000 of funding for producers so that new clean fuels can get to market quicker, speeding up the UK’s path to green flying.
SAF is an alternative to fossil jet fuel which reduces greenhouse gas emissions on average by 70% on a lifecycle basis. While the fuel is more costly to produce than jet fuel, the Government’s SAF measures protect industry and consumers from excessive costs.
In addition, the Revenue Certainty Mechanism (RCM) will keep ticket price changes minimal – keeping fluctuations to £1.50 a year on average – and will be industry funded through a levy on aviation fuel suppliers. The Department for Transport will continue to engage with industry on the details of the RCM, including pricing.
A new round of Government funding is also being announced, to offer fuel producers a share of £400,000 to support the testing and qualification of green fuels, helping to get them to market quicker. This support for producers follows £63 million of funding made available through the Advanced Fuels Fund this year.
Taken together, the Government’s commitments on green fuels will help deliver on its missions to kickstart economic growth via job creation, become a clean energy superpower, and will allow the UK to go further and faster with expansion plans, giving a boon to the tourism industry.
Aviation Minister, Mike Kane said: “I want to see a golden age for green aviation and today sees take-off for sustainable flights.
“Aviation continues to be one of the fastest growing and most integral parts of the UK’s economy, offering more jobs across engineering, tourism and hospitality – and as we support aviation expansion, we need to move at full throttle towards decarbonisation.
“We are making the UK one of the best places in the world to produce sustainable aviation fuel, putting the pedal down on growth and boosting job opportunities across the country as part of the Plan for Change.”
The new legislation will help industry meet its requirements under the SAF mandate, introduced in January this year, which specifies that at least 10% of all jet fuel used in flights taking off from the UK from 2030, be made with sustainable fuel, rising to 22% by 2040.
The new financial mechanism is another display that the UK is rock-solid in its commitment to building a prosperous hub for homegrown sustainable fuel production. Furthermore, this vital update provides SAF producers and the industry at large the confidence and stability to plough investment into clean energy.
The Government’s approach on low carbon fuels could add up to £5 billion to the economy by 2050 and position the UK as a global hub for SAF production.
Tim Alderslade, Chief Executive of Airlines UK, said: “This is a welcome announcement given the importance of the RCM to commercialising and scaling-up SAF production in the UK, a technology key to decarbonising aviation by 2050. A UK SAF industry, kick-started by the RCM and SAF mandate, can create tens of thousands of jobs across the country whilst supporting our world-class aviation sector to deliver economic growth.
“We look forward to working with Government on scheme design and how contracts are allocated, so that we balance the need to deliver the SAF required to support mandate compliance, whilst keeping costs as low as possible through a competitive and transparent bidding process that places the consumer at its heart.”
Duncan McCourt, Chief Executive of Sustainable Aviation, said: “We hugely welcome the publication of this important legislation. SAF is a crucial element in the plan to decarbonise aviation as it can be used in existing aircraft with existing infrastructure. The challenge now is to scale the industry, ensuring we have enough SAF to meet the mandate whilst keeping costs low and create thousands of jobs in the process. This legislation will help to do that.
