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Technical Report on ReFuelEU Aviation's Targets: A Feasibility Assessment

Future Cleantech Architects’ new technical report analyzes the feasibility of meeting ReFuelEU Aviation’s progressively increasing SAF targets by 2050. This analysis answers key questions, including the state of EU aviation today, the availability of feedstocks for biojet fuels, whether the EU can produce the necessary quantities of bio- and synthetic jet fuels, and the amount of clean electricity required to produce the requisite amount of synthetic jet fuels by 2050.

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Executive Summary

The EU benefits from a highly active aviation sector that, on average, consumes anually 10-15% of all the global jet fuel produced. The sector contributes significantly to EU annual emissions and makes up 14% of its transport emissions, second only to road transport. Emissions from aviation have been steadily rising in the EU, increasing by 30% from 2013-2019 and accounting for 5% of the EU’s total emissions in 2019. Following the impacts of COVID-19, flight demand is on the rise once again and is almost back at 2019 levels. Thus, there is significant pressure on the sector to reduce its emissions and align with the EU’s overarching 2050 climate goals.

As acknowledged by the EU, solutions such as all-electric and hydrogen planes are still in their testing phase and will play a limited role in decarbonization efforts over the next two decades. The EU has also identified the untapped potential of SAFs as drop-in fuels to reduce emissions from the sector by 2050. In 2023, the EU introduced the ReFuelEU Aviation regulation, a SAFs uptake mandate with progressively increasing minimum SAF targets – including sub-targets for synthetic jet fuels – until 2050. Demand is expected to continue outstripping efficiency improvements in the EU, with fuel consumption rising by 50% by 2050 (relative to 2019). This will be accompanied by an exponential growth in the share of SAFs, both bio- and synthetic, by 2050 from current levels.

If the regulation’s minimum targets are met, biojet fuels will be the largest contributor to the final fuel mix in 2050, at 45.5%. Today, the maximum production capacity for SAFs in the EU remains minimal at 0.24 Mtoe/year, or <1% of consumption. This analysis addresses key questions regarding the feasibility of meeting ReFuelEU Aviation’s targets. Considerations include the availability of feedstocks for biofuels, whether the EU is equipped to produce the necessary quantities of bio- and synthetic jet fuels, and the amount of clean electricity needed to produce the requisite amount of synthetic jet fuels by 2050.

Final EU aviation fuel mix until 2050

 Mt

Findings - Biojet fuel

Focusing on electrification in road transport in the EU opens the potential for shifting liquid biofuel production to biojet fuel to help achieve the ReFuelEU Aviation targets. Shifting 35% of today’s biodiesel capacity alone can help achieve the 2030 target. There is a high likelihood that the demand for biojet fuel past 2030 will have to be covered by diverting current liquid biofuel production to biojet fuel, installing additional capacity, and imports, with a heavier reliance on imports in the longer term. Converting 100% of today’s EU liquid biofuel production to biojet fuels could help achieve 45% and 30% of the 2040 and 2050 targets, respectively. Challenges will arise from the strengthened feedstock restrictions of the Revised Renewable Energy Directive (RED III), due to the limited supply of eligible feedstocks such as forest residue, municipal solid waste (MSW), and waste oil. EU production of biojet fuels will also face competition from sectors other than road transport looking to liquid biofuels as a decarbonization option, such as shipping. Importing bio-jet fuel in its final form and feedstocks for its production will also face competition from other regions over these scarce resources. This competition creates uncertainty around the amount of biojet fuel the EU can secure as 2050 approaches to meet ReFuelEU Aviation’s targets.

EU Bioenergy Consumption (144 Mtoe)
EU Liquid Biofuels Consumption (18 Mtoe)

Findings - Synthetic fuel

Synthetic jet fuel produced from green hydrogen and CO2 from DAC using clean electricity is the most expensive and energy intensive pathway but is also the pathway with one of the lowest lifecycle Greenhouse Gas (GHG) emissions. Less than 5% of total projected EU electricity production would be needed to produce the requisite synthetic jet fuels to meet ReFuelEU Aviation’s sub-targets by 2030 and 2040. However, there is an exponential growth in synthetic jet fuel contribution to the final fuel mix past 2040. By 2050, synthetic jet fuels must make up at minimum 35% of the final fuel mix, requiring 872 TWh of additional renewable electricity, with 80-90% of this electricity needed to operate the electrolyzers for green hydrogen production. Aviation currently requires minimal electricity; however, if synthetic jet fuels are to be fully produced on EU territory to meet ReFuelEU Aviation’s targets, an extra 31% of current electricity production levels – and 16.5% of total projected electricity production in 2050 –must be dedicated to producing these fuels. This electricity must be additional and from renewable sources, and cannot be diverted from other decarbonization efforts, especially electrification of road transport. Any shortfall in supply will have to be overcome with imports. Additionally, despite synthetic jet fuel subtargets starting in 2030, investment and production ramp-up must begin today for the EU to be ready to meet these targets.

While it seems feasible that the EU will be able to meet its 2030 targets, mostly through biojet fuels, consideration must be given to meeting its later targets until 2050. Shortfalls in the supply of biojet fuels and shortages in resources, such as renewable electricity and green hydrogen, to produce synthetic jet fuels on EU territory, become more apparent past 2030.

Renewable electricity for synthetic jet fuel production

TWh

Technical Recommendations

  • A full analysis of EU bioenergy needs and feasible production on EU territory by 2050 must be conducted. Liquid biofuels must then be prioritized for those sectors of the economy with limited decarbonization options, with a portion allocated for biojet fuels until 2050. This will help identify how much biojet fuel the EU can produce on its territory.
  • A complete breakdown of electricity needs across the EU in line with decarbonization efforts is necessary, including feasible growth in generation capacity in the EU by 2050, especially for renewable electricity. This breakdown must account for the renewable electricity needed for synthetic jet fuel production and allocate a given quantity to produce these fuels starting from today, if the 2030 targets are to be met, until 2050. This will help identify how much synthetic jet fuel the EU can produce on its territory.
  • A comprehensive feasibility analysis of green hydrogen production in the EU until 2050 is needed. The available green hydrogen must first be prioritized to decarbonize existing hydrogen needs in refining and fertilizer production and for use in emerging technologies in steel manufacturing. The amount of green hydrogen that can then be dedicated to aviation for use partly as the final fuel, but mainly as a feedstock for synthetic jet fuels production, must be identified.

Once these resources are properly allocated to the aviation sector, it will become clear how much biojet and synthetic jet fuel can be produced on the territory. Any discrepancy in supply must then be made up to meet ReFuelEU’s targets. One option is eligible imports from third countries that meet the minimum sustainability criteria outlined in ReFuelEU Aviation and the RED .

A Book and Claim scheme can help ease market accessibility to SAFs and reduce reliance on physical SAF imports by trading with trusted third-country partners. This scheme can also help reduce SAF lifecycle emissions by minimizing transport emissions. As jet fuel consumption is not uniform across the Union, Book and Claim can help ease these supply pressures by trading SAFs across the Union, as well. SAFs are then claimed by the airlines who pay the premium for them, while the physical SAFs are supplied to the airports that are geographically closest to the SAF production sites.

Policy Recommendations

Beyond operational improvements, alternative modes of travel must be promoted and incentivized following the ‘polluter pays principle’ on short-haul routes. This will help reduce overall jet fuel demand, helping to ease the SAF supply strain and easing the feasibility of achieving ReFuelEU’s 2050 targets.

Facilitating permitting for the construction of new SAF plants and accelerating the approval of SAF production pathways by the American Society for Testing and Materials (ASTM) can reduce project lead times and facilitate the large-scale deployment of SAFs, especially for synthetic jet fuels. Additionally, a uniform certification process is crucial to streamlining SAF eligibility toward the ReFuelEU Aviation targets, especially those that are imported. These procedures can help maximize SAF production potential within the EU to meet the regulation’s targets.

Current liquid biofuel capacity in the EU is enough to help achieve ReFuelEU Aviation’s 2030 target. However, the shift in production from biodiesel and biogasoline to biojet fuel incurs both CAPEX and OPEX costs. Regulation can help reduce cross-sectoral competition for biofuels, especially from road transport. Prioritized funding and subsidies for plants willing to convert production to biojet fuel can help incentivize the shift and accelerate production within the EU.

To date, the EU still exempts jet fuel from fuel taxation. Taxing conventional jet fuel while exempting SAFs with lower lifecycle GHG emissions is a powerful tool that can help close the cost gap between the two. Internationally recognized and legally binding SAF uptake mandates at ICAO level can help minimize market distortions and maintain a level playing field. Tax revenue can then be reinvested into accelerating sustainable solutions in the sector.

Revenue from carbon pricing is best used when reinvested into the sector to promote sustainable solutions. Bespoke policies, such as a frequent flyer levy, can also be used to cover higher SAF costs without affecting lower-income passengers who fly less. However, since aviation is a highly commercial sector, private support is crucial for accelerating SAF uptake through initiatives such as the First Movers Coalition.

While ReFuelEU Aviation has set clear progressive targets and eligibility criteria for SAFs, the quantity of clean electricity and sustainable feedstocks needed has not been highlighted. Budgeting these resources across various sectors of the EU economy must begin today. Incorporating this allocation within legislation will be crucial to the success of sector-specific regulations such as ReFuelEU Aviation.   

A SAF Book and Claim scheme can help widen the SAF market and reduce the dependence on physical SAF imports. However, effective implementation of a Book and Claim scheme requires clear guiderails on SAF eligibility and provisions against double counting. Incorporating Book and Claim for SAF tradability in the next revision of ReFuelEU Aviation, with clear guiderails for its implementation and a cap on eligible SAF quantities through this scheme, will help to ease supply constraints and strengthen the regulation’s targets without creating an overdependence on virtual SAF claims.

Read our Policy Brief on Book and Claim

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