Govt told it's now or never to get behind sustainable fuel sector
James ChappleThe government has been warned tens of thousands of potential new jobs and billions in export revenue are at risk if it fails to adequately back a homegrown sustainable aviation fuel (SAF) industry.
Airlines UK chief Tim Alderslade said the provisions in the government’s new Powering Up Britain initiative, set out on Thursday (30 March), didn’t sufficiently incentivise investors or producers.
Ministers on Thursday announced a fresh round of investment in the UK’s SAF sector via the Advanced Fuels Fund worth £165 million, as well as a second, more detailed consultation on mandating the UK’s aviation fuel mix feature at least 10% SAF by 2030.
These investments, though, pale in comparison with the $4.3 billion pledged by the US government to kick-start SAF production.
Alderslade hailed the consultation on the SAF mandate an "extremely positive" step, adding the Advanced Fuel Fund provision would assist with planning and construction work necessary to bring the UK’s first SAF plants online. The government is aiming to have at least five under construction by 2025.
However, Alderslade said the measures outlined on Thursday didn’t go far enough. "We have long been clear that while a mandate creates demand for SAF, it does not provide revenue certainty for producers in what is still a nascent industry," he said.
"Airlines will pick up SAF as required by government – either at home or through imports – but existing policy will not provide certainty to investors who want to build here in the UK and produce SAF locally."
Alderslade added that time was running out to establish a potentially lucrative homegrown SAF industry in the UK. "Without a clear commitment to a revenue certainty mechanism, without the need for public subsidy, in the coming days we risk this investment – and the tens of thousands of jobs and huge export potential from a homegrown SAF industry – going to the US, who announced their own support for SAF production months ago.
"We look forward to working with HM Treasury and the Department for Transport at pace to agree ways of ensuring this opportunity isn’t lost."
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