(Bloomberg) — Airlines could struggle to reach their near-term climate goals, according to Kristof Van Passel, head of procurement operations and development at Cathay Pacific.
That’s because the supply of lower-carbon sustainable aviation fuel (SAF) is “coming online slower than anticipated,” said Van Passel during the BloombergNEF summit in San Francisco on Wednesday.
Hong Kong-based Cathay Pacific, like most other major airlines, has pledged for 10% of their fuel to be sustainable by 2030. But the supply of SAF is likely to be 30% to 40% below the demand from airlines by the end of the decade, said Van Passel. “And we expect that gap to widen,” he added.
Read more: How United and Other US Airlines Lost Momentum on Sustainable Jet Fuel
The lower-carbon fuel is typically derived from animal fats, used cooking oil and other feedstocks. A number of startups are also trying to make the fuel from sources such as captured carbon dioxide. Reaching Cathay and other airlines’ 10% SAF target in six years is a massive challenge. SAF accounted for 0.03% of Cathay Pacific’s overall fuel consumption in 2022. Globally, SAF is about 0.1% of airlines’ fuel consumption today.
Another key challenge will be bringing down the cost of SAF, according to Van Passel, who said the lower-carbon fuels are two to three times more expensive than conventional jet fuel.
“Given the magnitude of the cost, it would drive any airline into losses within a matter of months,” he said.
Many airlines have balked at paying higher prices for cleaner fuels, despite touting their commitment to the SAF in advertisements and press releases, Bloomberg Green reported last year.
©2024 Bloomberg L.P.