Subject to parliamentary approval, the measures announced in the mandate, which will come into force in January 2025, are designed to ‘give UK aviation and the SAF industry the certainty to keep creating skilled British jobs while ensuring air travel is fit for the future’.
It follows the world’s first commercial 100% SAF transatlantic flight which took off from Heathrow in November and was backed by up to £1 million in government investment.
The targets, which the government describes as ‘ambitious but achievable’, will see around 1.2 million tonnes of SAF supplied to the UK airline industry each year and stimulate a SAF industry estimated to add £1.8 billion to the economy and create 10,000 jobs by 2030.
Protecting consumers
Despite the price differential of SAF, the government suggests that the plan, which includes a mechanism to help manage prices and minimise the impact on ticket fares for passengers, will ensure ‘decarbonisation doesn’t come at the expense of consumers’.
Providing sufficient supply, the government says “any increases in air fares as a result of SAF will fall well within the range of usual fluctuations in prices we see every year and the government has plans in place to prevent any major hikes.”
These include the power to change key limits within the mandate to block higher price rises in the case of SAF shortages – keeping the impact on consumers to a minimum.
Certainty
Transport Secretary Mark Harper said: “Sustainable aviation fuel protects the future of UK aviation, the thousands of British jobs that depend on it, and the holidays and business travel flights that we all rely on.
“As part of our plan to grow the economy, the measures announced today will give both UK aviation and the UK SAF industry the certainty they need.”
The government has also launched a consultation today into a range of options for a SAF revenue certainty scheme, which looks to guarantee revenue from SAF and provide new and existing producers and investors with the confidence to continue investing in the industry.
The consultation includes a preferred option of a guaranteed strike price (GSP), which guarantees a pre-agreed price of SAF supplied to the UK market – giving producers the confidence that they will receive a certain price for the SAF they make.
Industry responds
The plans set out in the SAF mandate have been widely welcomed by industry.
A Fuels Industry UK spokesperson commented: “Fuels Industry UK welcomes today’s SAF mandate announcement that gives more certainty on the UK’s future demand for sustainable aviation fuels so industry can now work on ensuring their supply.
“It is encouraging that the UK government has acknowledged the important role that HEFA is likely to play in the first years of the mandate and the commitment to keeping its levels under review. Allowing all production methods can attract early UK SAF investment, while also offering clear trajectories for new fuels which will be developed as demand grows.”
Karen Dee, Chief Executive of the Airport Operators Association, said: “We are pleased that the government has brought forward proposals for a mandate and revenue certainty scheme, that will send the message to investors that the UK is serious about developing its own production facilities.”
Tim Alderslade, CEO of Airlines UK, said: “UK airlines support a SAF mandate as a vital step towards the net-zero transition.
“However, it is vital that government now puts the right measures in place to incentivise production and reduce the cost of SAF as seen in the EU and US, as quickly as possible.”
Encouraging SAF from waste
Gaynor Hartnell, Chief Executive of the Renewable Transport Fuel Association, said: The mandate, in combination with guaranteed pricing, will see the UK start to produce SAF within the next couple of years.
“There are many ways of making SAF, and all have a vital role to play. Many of the plants our members will build will be ground-breaking, first-of-a-kind installations. The UK policy aims specifically to encourage SAF made from wastes, which presents an opportunity for innovation and ultimately the export of technology and expertise.
Also highlighting the importance of feedstocks, Luis Gallego, CEO of IAG, said: “The mandate will ensure SAF is created in ways that are better for the environment, encouraging techniques that turn renewable energy into fuel, known as power-to-liquid.
“It will also incentivise the use of different types of waste to produce fuel, like sawdust and bark from forests, to tackle global issues such as deforestation, biodiversity and competition with food production – while placing a cap on fuel primarily made from cooking oil, which is the cheapest and most developed SAF pathway.”
Image courtesy of UKPIA (the former name of FIUK)