Heathrow urges govt to incentivise transition to sustainable fuels
Gary NoakesHeathrow has warned the government is must come up with supportive policy to support a 10% sustainable aviation fuel (SAF) mandate by 2030 as the airport prepares to triple the amount of SAF (SAF) it supplies this year.
The airport aims to supply 1.5% of airlines’ fuel needs with SAF this year. Although the percentage is small, it makes Heathrow one of the world’s largest users of SAF, derived mainly from used cooking oil. In 2022 Heathrow claimed a world first with an airport SAF incentive programme covering up to 50% of the extra cost of SAF.
It said: “With last year’s scheme oversubscribed, Heathrow is now aiming to triple the percentage used in 2023 to approximately 1.5%, putting the airport on course to be one the world’s largest users of SAF this year.”
Participants of the scheme include IAG, Virgin Atlantic, United Airlines, Air France, KLM and JetBlue.
Heathrow is targeting 11% SAF usage by 2030 and believes its incentive scheme can now serve as a blueprint for other airports. However, high costs and low production volumes mean SAF is in short supply with few able to access it at commercially viable rates.
The airport, which has a £38 million fund to support airlines, called for the government to follow the US example, with tax credits to lure SAF investors.
“Government must act now to support a SAF industry for the UK, which learns from but does not seek to replicate the US system,” it said, adding this could be achieved by introducing a “contracts for difference” price support mechanism to cut the price premium between SAF and fossil fuel, something already used to boost solar and wind technologies.
It added: “Government must also act swiftly by committing into legislation a 10% mandate for SAF use by 2030 this year, before the impetus and the value is lost. Delay could mean that the UK SAF industry suffers and cannot keep up internationally. By delivering both, the UK will see an immediate and tangible impact – with investment, jobs and skills seen right across the UK.”
Heathrow chief executive John Holland-Kaye added: “Heathrow is now probably the biggest user of SAF in the world. But it is currently all imported. If Britain really wants to compete with the scale of ambition and the credible action seen from the US and Europe, supportive government policy is needed and it is needed now.”
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