Sustainable flight: the SAF route in Latin America and the Caribbean
Achieving this collaboration between the public and private sectors is one of the priority issues on the agenda of the ALTA Aviation Law Americas 2022 held in Rio de Janeiro.
Sustainable aviation fuel, or SAF, for its acronym in English, is a cornerstone on the path to meeting the environmental objectives set by the airline industry to achieve net zero emissions by 2050. In addition, it is a powerful economic engine with perspectives of generating important socioeconomic contributions in the short, medium and long term for the countries.
In the Latin American and Caribbean region, the development of an SAF-producing industry requires cooperation between States and private industry and an efficient regulatory framework with legal certainty to attract investment.
Achieving this collaboration between the public and private sectors is one of the priority topics on the agenda of ALTA Aviation Law Americas 2022, which will be held from September 14 to 16 in Rio de Janeiro, Brazil. The first panel of the conference was dedicated to SAF, with the participation of Pedro de la Fuente, senior manager of external affairs and sustainability at IATA as moderator, Erasmo Batistella, CEO of the energy company BSBIOS, and Johanna Cabrera, Deputy Manager of Sustainability at LATAM airline.
The experts discussed the advances of the private sector in the deployment of the SAF, the economic growth figures derived from this industry, the public policies necessary to attract investments, the existing and projected demand of the airlines and the perspectives for the coming years.
“The transition from hydrocarbon-based fuels to SAF requires creating a production and distribution chain from the ground up. Previously, industry-government aligned work is necessary, which is critical to achieve efficient policies, since it is necessary to have legal certainty that allows investments and the development of infrastructures that generate competitiveness. The region has all the necessary raw materials and the capacity to generate the jobs necessary to achieve this. To name an example, since we are in Rio de Janeiro, Brazil has the potential with its raw materials to supply more than 30% of the global demand for SAF by 2030. It is a great opportunity that we cannot miss”, comments José Ricardo Botelho , Executive Director & CEO of ALTA.
Erasmo Battistella, CEO of BSBIOS, shared the details of what will be the first SAF plant in Latin America and the Caribbean in Paraguay. Among the outstanding numbers: the production of 20 thousand barrels per day with an estimated capex of 1.1 billion dollars from 2025 with raw materials soybean oil, recycled oil and animal fat. Battistella stressed that "it is essential to review the legislation on raw materials and have a single certification in all countries, otherwise this increases the price of SAF and makes it difficult to access. Batisttella also highlighted the importance of legal certainty and access to capital as keys for there to be investments in the region."Paraguay has offered the best tax conditions and competitiveness for exports. This region has all the raw materials like no other and we must work authorities and industry to have the conditions that allow the development and industry in our countries."
In the field of energy transition, the airline industry and governments pursue common goals: the total decarbonisation of air operations and the reduction of greenhouse gas emissions. According to ALTA member ICF, the global aviation industry will need 330 to 445 million tons of SAF per year, the equivalent of 180,000 Olympic swimming pools, and currently SAF production is less than 0.01% of global jet fuel consumption. .
"The aviation industry is a vital feature of our modern, globalized world, serving as an essential conduit for world trade and economic development. However, these connectivity benefits create an environmental challenge. While the aviation sector recognizes the growing and urgent need for society to address the global challenge of climate change, also plays a vital role in promoting sustainable development and must remain safe, affordable and accessible to ensure equitable mobility for all sectors of the population. For this reason, we need the support of governments in ensuring the adoption of a long-term objective during the next ICAO assembly for the implementation of a harmonized policy and common objectives in our goal of
decarbonization", comments Pedro de la Fuente, IATA Externals Affairs & Sustainability
The region is the one with the greatest potential to produce SAF in the world. However, it still lacks the necessary infrastructure and legal framework to establish a production industry that meets local demand and even exports sustainable fuel to other latitudes.
Johanna Cabrera, Deputy Manager of Sustainability of LATAM Airlines, highlighted in her intervention the urgency of public policies that contribute to generating incentives and legal certainty to leverage the necessary investments for the development of an SAF-producing industry in the region. "LATAM will seek that by 2030, 5% of the fuel used is SAF, an important measure that accompanies other initiatives such as operational measures and compensation of high quality emissions." Cabrera also stressed that as an industry we need to take care that the energy transition is efficient and that prices are taken care of so that air ticket rates are not increased, which the industry has been reducing for years through operational measures and other initiatives.
The Latin American and Caribbean Air Transport Association (ALTA) promotes an agenda of objectives and projects aimed at achieving the deployment of SAF in the region. Among the proposals promoted in a joint effort with the Latin American Civil Aviation Commission (CLAC) are included: incentives for SAF production programs that include loan guarantees or subsidies, support for research and development of the supply chain, and the creation of an adequate regulatory framework so that capital is invested in the most efficient way.