25 February 2024

GreenAir News

Reporting on aviation and the environment

Microsoft and World Energy sign landmark 10-year book-and claim SAF deal

Global technology company Microsoft will compensate carbon emissions from its corporate air travel and supply chain air cargo for the next 10 years through a landmark new book-and-claim partnership with US-based renewable fuels producer World Energy. Under the agreement, claimed by both companies to be the largest and longest of its type, Microsoft will buy sustainable aviation fuel certificates (SAFc) and World Energy will produce the requisite volumes of fuel. The SAF associated with the certificates will be transferred by World Energy from its plant in southern California to the nearest major airport, Los Angeles International, for use by airlines there. California has just passed corporate emissions reporting requirements, and similar regulations are expected soon from the US SEC and the EU, that include indirect (Scope 3) emissions like business travel and shipping.

Microsoft and World Energy estimate that 43.7 million gallons (165 litres) of petroleum jet fuel will be displaced by low-carbon SAF during the life of their book-and-claim partnership, and say the initiative will cut flight emissions by more than 469,000 tonnes of CO2.

“That is the equivalent of flying 824,053 economy class passengers from Seattle to New York and back on fully decarbonised flights,” explained the companies, “or decarbonising the transportation of over 54,000 tonnes of cargo between Asia and North America.”

Book-and-claim programmes are becoming increasingly popular, not only as tools to help corporations offset their travel emissions, but also as a means of increasing demand for and production of SAF, which is in short supply.

“The role of SAF certificates in decarbonising aviation is poised to grow exponentially and Microsoft’s commitment will help accelerate that growth,” said World Energy.

All parties benefit, with corporate customers able to progress their sustainability goals through the purchase of independently-authenticated SAF credits, fuel producers able to viably increase their SAF outputs as demand increases and airlines eventually able to access more and cheaper SAF as higher production begins to bring down prices.

As well, because the fuel covered by SAF certificates does not need to be physically transferred to certificate buyers, in this case Microsoft, it can be transferred to airports near where it is produced, minimising the logistics costs and emissions of transportation, while boosting SAF stocks.

World Energy was the first company in the world to produce SAF in commercial volumes, delivering initial supplies from its Paramount, California facility in 2016. Now one of three companies producing high volumes of SAF, it plans to increase its Californian production to 250 million gallons per year by 2024 and to add another 250 million gallons per year from 2025, when it activates a second plant in Houston. By 2030, it is targeting 1 million gallons per year.

“We’re thrilled to be launching this long-term collaboration with Microsoft,” commented World Energy CEO Gene Gebolys. “Through this agreement, we will empower one of the world’s most recognised innovators to grow their business while minimising their carbon impact.

“Together we’re committing to making a sustained push well into the next decade to decarbonise aviation at ever-greater scale. Microsoft has made some of the most ambitious decarbonisation commitments of any corporate leader and we are honoured to be teaming up to help them meet those goals.”

Katie Ross, Microsoft’s Director, Carbon Reduction Strategy & Market Development, said the partnership with World Energy “exemplifies the power of collaboration and technology in driving meaningful change in one of the hardest-to-abate sectors.

“Not only will it help to reduce our business travel and supply chain logistics emissions, but we hope this agreement will inspire others to take action and support the transition to alternative fuels that will enable a decarbonised aviation industry.”

The first SAF to be delivered under the new deal is expected to reach Los Angeles International Airport later this year.

Photo: World Energy’s Paramount facility

Editor’s note: Speakers from World Energy and Microsoft will be discussing their new agreement at the forthcoming Aviation Carbon 2023 conference in London on November 6/7, 2023.

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