European aviation players launch Project SkyPower to drive investment in e-SAF and meet EU and UK mandates

A high-profile European coalition has joined forces to urgently advance the production of e-SAF – sustainable aviation fuels produced by combining renewable electricity, water and captured carbon dioxide. Project SkyPower brings together 13 CEOs and more than 50 companies including airlines, airports, energy companies and financiers to push for government policies that enable production of e-SAF from 2030. A report by the new group says Europe has a strong opportunity to capture a big share of the global e-SAF market, which it estimates could be worth €250 billion ($270bn) by 2050 and create up to 90,000 direct jobs. But it argues that to do so will require investments between €15 billion and €25 billion by 2030, encouraged by supportive government policies. Globally, says the report, Europe has 26 of the 31 large-scale e-SAF projects currently proposed. “But while 70% of the global e-SAF project pipeline is located in Europe,” it adds, “no plant has yet reached final investment decision (FID).”

Foundation members of Project SkyPower include Air France-KLM, easyJet, Arcadia eFuels, Copenhagen Airports, private jet service Victor, SAF providers Velocys and SkyNRG, and finance and technology providers including ING, Rockton, Natixis, KGAL and Topsoe. It is co-chaired by Dutch industrialist and former Unilever CEO Paul Polman, and the CEOs of KLM, Marjan Rintel, and Arcadia eFuels, Amy Hebert.

“Project SkyPower’s mission is to pave the way for the first large-scale e-SAF plants in Europe to reach final investment decision by 2025,” says the report, “in order to drive progress towards key regulatory targets, ReFuelEU and the UK mandate.”

To reach those targets and achieve net zero emissions by 2050, the group argues that production of e-SAF must commence by 2030 and continue to develop, initially with strong government support.

Project SkyPower has been convened to promote e-SAF as the most effective and eventually most affordable pathway to low-carbon flight, and to urge governments to introduce policies that reduce investment risk in infrastructure development and fuel production before SAF mandates take effect.  

While e-SAF technology is scaled, the group wants government funding from existing taxes on the aviation industry to bridge the premium between e-SAF and fossil fuels, helping to secure long-term demand and mitigating first-of-a-kind project risk to initially unlock commercial capital.

The Project SkyPower report says e-SAF could deliver lifecycle emissions up to 90% lower than conventional aviation fuels with few feedstock constraints compared to other SAF types.

“Bio-SAF, or SAF produced from biogenic material, offers an affordable and commercially available decarbonisation solution for aviation both in the near and long term,” says the report.

“However, due to the globally limited availability of sustainable biomass feedstock and competing demands from other sectors, bio-SAF alone will not be able to decarbonise the aviation industry. It will need to be complemented by large volumes of e-SAF.”

As well, says the report, e-SAF production is held back by a lack of renewable energy generating capacity, and the need to accelerate development of Direct Air Capture technology for trapping atmospheric CO2.  

Project SkyPower warns that European aviation has less than two years to achieve final investment decisions for e-SAF plants if the fuel is to be available in time to comply with EU and UK SAF blending mandates.

It estimates capital investment of €15 billion to €25 billion ($16-27bn) will be needed by 2030, with a further €3 billion to €5 billion annually to reach the scale needed to meet escalating blending mandates.

“E-SAF needs to reach commercial scale by 2030 and hit market tipping points in the 2030s to reach the scale necessary to enable a lower-emissions aviation industry by 2050,” claims the report.

“It typically takes five years for an e-SAF project between reaching final investment decision and being operational. Therefore, FIDs for e-SAF projects are needed by 2025 to start production by 2030.”

The report says economic modelling performed for Project SkyPower indicates that without government subsidies, the production cost alone of e-SAF in Europe could be five to eight times greater than that of conventional jet fuel, including Emission Trading Scheme costs.

KLM’s CEO, Marjan Rintel, one of the three co-chairs of Project SkyPower, and the Air France-KLM representative in the group, said her company had studied multiple decarbonisation technologies “of which synthetic fuel (e-SAF) is expected to be the most promising in terms of feedstock availability and cost perspective.”

She added: “Project SkyPower is modelling the conditions required to overcome the barriers to scaling e-SAF. By working together, we now have a shared economic model for e-SAF and an action plan to be implemented by the wider aviation ecosystem.”

Another of the group’s co-chairs, Arcadia’s Amy Hebert said: “Successful delivery of Project SkyPower’s action plan will fundamentally change the e-SAF landscape, establishing the necessary conditions to take final investment decisions and accelerate this critical technology towards commercial operation by 2030.” Her company is aiming to activate a new e-SAF plant at Vordingborg, on the Danish island of Zealand, in 2026. The third of Project SkyPower’s co-chairs, Paul Polman, said: “Partnering with governments, financial institutions and civil society is imperative to scale e-SAF to a tipping point where it not only progresses on urgent emissions reduction but also secures millions of jobs and future-proofs the aviation industry.”

Photo: A flight by KLM from Amsterdam to Madrid in 2021 used 500 litres of e-SAF produced by Shell

Tony Harrington

Correspondent

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