Shell Shifts Sustainable Fuels Focus To Aviation Sector

Royal Dutch Shell (NYSE: RDS-A) is building on its sustainable transition goals with an ambition to produce 2 million metric tons of sustainable aviation fuel (SAF) per year by 2025.

"Currently, sustainable aviation fuel accounts for less than 0.1% of the world's use of aviation fuel. We want to help our customers use more SAF," Anna Mascolo, president of aviation at Shell, said in a release Monday.

As the mode of transport that emits the most greenhouse gases per ton-mile, aviation is an important but difficult sector to decarbonize. Shell made it clear that the aviation industry needs to take more action to reduce emissions.

The company aims for 10% of its fuel sales to be SAF by 2030.

Alongside this announcement, Shell published two "decarbonizing aviation" reports: one in which more than 100 aviation industry executives and experts came to the conclusion that the global aviation industry's targets are not ambitious enough and one that outlined Shell's path forward in aviation and SAF production.

"The good news is that SAF is available now, and production can be ramped up with current production methods, so long as we do not restrict the use of the various available sustainable feedstocks. Demand for SAF is growing, with corporate and other end customers now showing a willingness to pay the incremental cost to deliver real in-sector reductions in greenhouse gas emissions on their aviation travel and air freight," Thorsten Lange, executive vice president for renewable aviation at Neste Corp., said in the release.

SAF can be used as a drop-in fuel without any required changes to aircraft engines, but SAF can only make up a maximum of 50% of a jet fuel blend due to technological limitations. Greenhouse gas emissions throughout the life cycle of SAF can be cut up to 80% when compared to conventional jet fuel.

The "Decarbonising Aviation: Shell's Flight Path" report listed major barriers to current SAF use:

• SAF is in short supply, and the infrastructure needed to scale it isn't there yet.
• Price-sensitive customers have to pay more for a lower-carbon fuel. That is known as a green premium.
• Regulatory bodies have not put sufficient tools in place to encourage increases in demand and adoption for SAF and increase investments in infrastructure and production.

"Shell's announcement to ramp up production of renewable jet fuel by 2025, combined with investments in European biofuels production and a recent enormous divestiture of oil assets in West Texas, demonstrate their commitment to a fossil-free mobility future. They are clearly not running away from the challenging fight against global warming and are leading the charge among Big Oil firms to decarbonize transport," said Tyler Cole, director of carbon intelligence at FreightWaves.

Netherlands Biofuels Facility To Contribute To SAF Production

This news comes after Shell announced last week it is building "one of Europe's biggest biofuels facilities" at the Shell Energy and Chemicals Park Rotterdam in the Netherlands. 

The facility will have the capacity to produce 820,000 metric tons of biofuels, including renewable diesel and SAF. 

If the total fuel capacity were used to produce renewable diesel, Shell said it could prevent 2.8 million tons of carbon dioxide emissions annually — the equivalent of taking 1 million European cars off the road.

But more than half of the annual biofuel production could be allocated for SAF, according to the release. Shell plans to produce 55% less of its traditional fuels by 2030, shifting the focus to low-carbon fuels such as SAF, renewable diesel, biofuels, and hydrogen.

These alternative fuel production goals will bring Shell one step closer to its net-zero emissions target for 2050.

Click here for more FreightWaves articles by Alyssa Sporrer.

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