SAFc open the market for clean energy in aviation.
What Are Sustainable Aviation Fuel (SAF) and SAF Certificates?
Sustainable aviation fuel (SAF) is a domestically produced biofuel that is blended with traditional jet fuel. It is a “drop-in fuel” that works in existing jet engines. SAF reduces aviation emissions and particulate matter in the air.
A SAF certificate (SAFc) is a market mechanism that represents the environmental attributes of a metric ton of neat (unblended) sustainable aviation fuel (SAF). SAFc enable companies to purchase, transparently track, and claim the emissions benefits of using SAF without having to buy the physical fuel.
This approach recognizes that SAF does two types of work:
- Powering jet engines
- Reducing emissions within the aviation sector thanks to its low life-cycle carbon footprint
With SAFc, both of these benefits can be accurately measured on their own and purchased by different customers.
SAFc cover both an aircraft’s direct emissions (Scope 1) and a company’s indirect emissions (Scope 3) associated with employee flights or air cargo deliveries. Responsibility for the same emissions may be shared by different parties under different scopes according to carbon accounting guidance. SAFc give those parties the ability to legitimately share credit for the carbon reduction achieved when sustainable aviation fuel is blended with traditional jet fuel and added to the supply chain.
SAF certificates are what’s known as insets, which means they deliver carbon reduction within the sector where the emissions are generated. The World Economic Forum and RMI developed the SAFc model in 2021 in response to the challenges of scaling the supply of SAF more quickly and helping companies reduce their Scope 3 carbon footprints without compromising growth or competitiveness.
How SAFc Work
SAFc are purchased and digitally tracked through the supply chain.
- A company calculates its aviation emissions, sets its goals for industry-driven decarbonization, and buys SAFc equivalent to those goals. SAFc are generally priced in metric tons of carbon reduction, which are affiliated with specific gallons of sustainable aviation fuel that will be produced because of the purchase.
- By purchasing SAF’s environmental attributes via SAFc, companies pay for the value of SAF’s decarbonization. This helps make SAF cost competitive.
- A digital chain-of-custody system called Book & Claim tracks the movement of the SAF and the SAFc through the supply chain. This ensures transparency and avoids double counting.
- Once the SAF is verified in the supply chain, the company that buys the SAFc insets can claim the carbon footprint reduction against the tons of carbon associated with its aggregated flight emissions. This is also called “retiring” their emissions.
How SAFc Scale the SAF Industry and Solve Decarbonization Challenges
SAF certificates solve key challenges that have stood in the way of scaling the biofuels industry and addressing industry-driven decarbonization in aviation.
Challenge: Cost
Even though sustainable aviation fuel turns agricultural waste into renewable feedstocks, those inputs and the need for new refining infrastructure make SAF more expensive to produce than traditional jet fuel. This is a challenge for airlines operating on thin margins.
Solution:
Companies outside the aviation sector that want to drive clean energy innovation in their supply chains have the motivation and the means to purchase the environmental attributes of sustainable aviation fuel. This cost collaboration allows airlines to purchase the fuel itself more affordably. In the long run, the price of SAF will drop as supply increases.
Challenge: Control of fuel used for flights
Companies that want to reduce Scope 3 aviation emissions in a practical way don’t buy jet fuel or control the type of fuel airlines use on their flights.
Solution:
The lifetime carbon savings of sustainable aviation fuel benefits the atmosphere regardless of where the fuel is physically delivered. So, by using SAFc, a company can apply the environmental benefits of SAF to flights from anywhere to anywhere. The Book & Claim system ensures the transparency and integrity of the process.
Challenge: Logistics
SAF is currently produced in only a few places, but it’s inefficient and costly to truck or ship it to far-flung airports.
Solution:
Buyers of SAFc don’t take possession of the actual fuel. The gallons of SAF associated with the SAFc are added to the aviation fuel supply as close as possible to where the SAF is produced. This minimizes cost and emissions from transport as well as logistical burdens.
Challenge: Reputational risk
Companies are sensitive to the potential damage that greenwashing accusations can do to their consumer credibility and reputation.
Solution:
Independent third parties verify SAFc credits, and registries confirm the life-cycle carbon savings at every step of the SAF production and delivery process. Book & Claim transparently tracks the SAFc transfer and its eventual use against flight emissions. This guards against double counting and substantiates the emissions reduction claimed.
Challenge: SAF supply
The refining capacity of sustainable aviation fuel is currently limited, due in part to the up-front capital investment required to expand or build new facilities.
Solution:
Long-term SAFc contracts bring companies with high credit ratings into the financial mix and signal long-term demand. This gives investors confidence that a SAF refinery can count on customers for its product well into the future. Unlocking critical capital investment accelerates production, expands supply, and strengthens the energy diversity of the economy.
A Model for the Future
Many companies with ambitious goals for market growth and emissions reductions have partnered with World Energy to decarbonize their flight with SAFc. This approach can apply to other critical sectors by enabling customers to help fund and drive demand for innovative energy solutions within their value chains. We invite everyone on board for the journey.