For industries such as the automotive and ground transportation industries, the path to decarbonization seems to be mapped out; however, for the airline sector it is still uncertain. While electrification is a viable option in very few cases, sustainable aviation fuels (or SAFs) have emerged as an alternative, albeit at a very high cost.
Sustainable aviation fuels (or sustainable aviation fuels, SAF) is the term that encompasses unconventional aviation fuels, that is, fossil fuels. These fuels can be oils derived from oleaginous plants, algae, solid waste, leftover cooking oil, and agricultural and forestry waste, among others. Under the right conditions, it is estimated that its use can generate up to 80% less emissions than traditional jet fuel.
The potential of the SAF to reduce emissions from the aviation sector is the most promising from the point of view of the industry. According to a study by the consulting firm Deloitte and the energy company Shell, 78% of a sample of those surveyed considers that these fuels will have the greatest impact on the decarbonization of their operations by 2050, well above those who have the same opinion about hydrogen. as fuel and even the use of batteries similar to those of electric cars.
The appeal of SAFs lies in the fact that they can be used in existing aircraft, and can even be mixed with regular fossil fuel in different proportions ranging from 10% to 50% of the total, allowing for a measured but costly transition.
According to a report by the Institute for Environmental and Energy Studies (EESI, for its acronym in English), the production cost of sustainable fuels is four to five times higher than that of fossil fuels, which is why it concentrated only 0.1% of the global aviation fuel consumption in 2019, according to a study by the World Economic Forum.
Despite its cost, the use of sustainable fuels is urgent to reduce emissions in the sector, although in emerging economies such as Mexico it faces very particular challenges.
“There are many reasons why it would make sense to promote the development of the SAF in Mexico. It is a way to reduce emissions in the country, which also has social benefits”, explains Carlos Ozores, general director of the aviation area of the ICF consultancy. “It is also a way to take advantage of garbage and waste based on used cooking oil. There are different technologies, one of them is using plants like soybeans and sugar cane, which has its challenges because you compete with agricultural land.”
Mexico and tax subsidies
Although slowly, Mexican airlines have aligned themselves with the international strategy of reaching zero emissions by 2050, outlined by the International Air Transport Association (IATA).
This has been the case of Aeroméxico, which since 2010 has operated several flights with sustainable fuels to Costa Rica, Madrid, São Paulo, and more recently the United States, with SAF made from waste animal fats and vegetable oils, as well as jet fuel. Jet A, acquired from the Neste Company.
Viva Aerobus signed a purchase agreement with the same company for one million liters of SAF, which began to be used on flights between Guadalajara and Los Angeles since last June.
But due to the cost of these fuels, airlines require certain conditions for their use to be viable, which basically translates into subsidies.
“For airlines, these operations can only become economically interesting through production with tax benefits,” says Ozores. “We, for example, are helping airlines to negotiate contracts so that by the middle of the decade there will be enough SAF production in California so that its price is equitable with jet fuel .”
For Neil Pedersen, executive director of the Transportation Research Board (TRB), a tax policy on fuels is key to encourage the use of more sustainable alternatives through subsidies and tax cuts, and can even be used in the opposite direction by taxing companies with the highest carbon emissions, and even fine them.
“What economic science says is that a fiscal policy is probably one of the best solutions to change the behavior of companies, but it can only happen if the public policy makers support it,” says the specialist. “A levy policy is always a problem, because politicians usually don’t want to fall for a tax increase that makes the majority of the population angry.”
Promoting a public policy that makes the cost of producing and using SAF viable is relevant, especially in the face of a horizon in which the use of other technologies is still distant.
“What is being evaluated right now, and what is really the future of clean aviation, is going to be hydrogen, because it is an energy source that generates a lot of power. Although it is very bulky to store and requires a lot of space, it has really been seen as clean energy, although it depends on how you produce it”, says Ozores. “It’s a much longer-term issue, probably to be resolved in the next decade.”