SAF LONDON CONFERENCE - Corporate Jet Investor Q2-24

SAF CONFERENCE LONDON 2024

Speeding SAF supply

Quickening the pace of SAF production dominated our inaugural SAF Investor conference. Words: Oscar Henderson

SAF CONFERENCE LONDON 2024

Speeding SAF supply

Quickening the pace of SAF production dominated our inaugural SAF Investor conference. Words: Oscar Henderson

EVERYONE WHO attended SAF Investor London 2024 wanted to see the production of sustainable aviation fuel (SAF) speed up. Finding the capital to achieve that was a key theme of the event.

The disconnect between investors and producers was a key discussion point throughout the conference. Lenders, investors and arrangers are keen to support the industry but would like long-term certainty. “It’s a 10- to 15-year model that you have to put together,” said James Falzon, associate director, European Bank of Reconstruction and Development.

IAG announced a 14-year, 260m gallon off-take with TWELVE during the conference. They have also made investments in producers like Nova Pangaea Technologies in the UK.

“Airlines have to move up the supply chain. The airlines are the people who hold the risk here, and we need to do more than, historically, the airlines have done before,” said Jim Davis, programme director, Sustainable Flight, IAG. Airlines can only take SAF development so far.

Financiers would ideally like more longer-term agreements. Kevin Bogenreif, MD, Summit Next Gen, added “you will continue to see a financing challenge,” without these.

This is a big gap with airlines. Thomas Fowler, director of Sustainability and Finance, Ryanair said: “This is a new market and price … I don’t think anyone wants to commit to a price for the next few years”.

Despite the discussion around long-term off-take agreements, 70% of attendees thought governments were going to encourage investors most, whether this be through price certainty schemes, mandates or incentives.

Ingrid Holmes, executive director, Green Finance Institute said that investors will need “certainty on the level of revenue coming through from those plants when they are in production”. A scheme supporting this is due to come into place in the UK from 2026.

However, strong policy is not the only solution. “Since the approval of ReFuelEU, we have not seen an explosion of FIDs [Final Investment Decisions] when it comes to SAF production projects or PtL [Power-to-Liquid] projects, in particular. And what that is showing is … we need de-risking instruments,” added Mariano Berkenwald, manager – Europe, Breakthrough Energy, in the session looking at the future for ReFuelEU.

Despite the challenges, most conference delegates thought the industry was developing positively. About 58% of attendees were fairly optimistic about SAF production in 2024 and 14% were very optimistic. All agreed this is set to be a crucial year for SAF production with European ReFuelEU mandates coming into force in 2025.

But building SAF’s success depends on harnessing private investment to meet growing demand, said Gene Gebolys, CEO, World Energy. “If we create a service that people want, then we unleash private sector investment and private sector demand in a service that enables capitalism to work.”

SAF Investor London took place at the Royal Garden Hotel, London on February 27th and 28th.

India offers great potential, says Viijay Nirani, Trualt Bioenergy. It just needs a regulatory nudge to really show its potential in terms of SAF production.