Rachel Reeves is banking on Sustainable Aviation Fuel – but will it ever become a reality?
Chancellor Rachel Reeves today confirmed government backing for Heathrow Airport’s third runway.
The announcement, outlined in a growth speech in Oxfordshire, followed a week of speculation that the long-delayed and highly controversial proposals could be back on the agenda.
It came alongside news that Gatwick and Luton would also be given the green light for their respective plans – both are more modest yet further down the track.
Debate over airport expansion has raged this year given the number of plans currently in place, leaving the government caught between prioritising economic growth or its commitments to the environment.
Central to this debate is Sustainable Aviation Fuel (SAF).
SAF, which refers to biofuels made from waste products like cooking oil, has been touted as the aviation industry’s best chance of hitting net-zero by 2050.
The government says they emit 70 per cent less carbon emissions over their lifetime so it is unsurprising, then, that Reeves sought to play down environmental concerns by referencing their importance.
But is it really the answer?
SAF is incredibly costly, between two to seven times more so than traditional kerosene-based jet fuel, and global production is currently well below the level necessary.
A number of top-level executives, including the former chief executive of Boeing, have in recent years warned SAF can never meet the price of jet fuel, alluding to quieter skepticism within the sector of its importance as a solution.
Ryanair boss Michael O’Leary on Wednesday was more emphatic. Asked at a conference in London whether he thought SAF was the future, he said: “No.”
“Nobody is producing SAF in the volumes airlines are going to need, we have a two per cent mandate in 2025 which we will just about meet, because the fuel companies are not producing enough.”
The current aim is that by 2030, 10 per cent of all jet fuel from flights leaving the UK should be sustainable. Heathrow, the UK’s biggest airport, expects three per cent of fuel used by its airlines to be SAF, by 2025.
These are tiny figures despite some of the grandiose claims made by the sector and come as airlines and airports report record passenger traffic amid a post-Covid boom in travel demand.
The trade association AirlinesUK today welcomed news of Heathrow’s expansion but in the same breath stressed the need for “further policy support” to incentivise SAF production.
And unions accused Reeves of “missing an own goal” by failing to link Heathrow’s expansion with a move to transform Grangemouth, Scotland’s only oil refinery, into a SAF production facility ahead of its planned closure.
There are other options, such as hydrogen and electric power, but they are far more nascent even than SAF.
It is because of such lack of uptake of alternative, greener fuels that environmentalists believe Heathrow’s expansion is fundamentally incompatible with net-zero. This is a position backed by the government’s independent adviser, the Climate Change Committee (CCC), which is currently drafting up this Spring’s carbon budget.