The Gulf will play a major role in sustainable aviation

Emirates

Aviation is so much part of the Gulf landscape that Dubai has been dubbed the world’s first “aerotropolis”. 

Flight brings together the region’s long history as a hub of trade and travel, with its modern role of global oil exporter. Climate change and net zero goals threaten both those aims – but also present opportunities.

Last month Air New Zealand signalled just how difficult airlines will find the green transition when it grounded its 2030 emissions target. It had wanted to cut carbon intensity 28.9 percent below 2019’s level.

Last year Akbar Al Baker, who was then the long-time chief executive of Qatar Airways, told the Paris Air Show that the aviation industry’s 2050 net zero goal was unattainable.

---

---

Higher temperatures present some practical problems. Aeroplanes struggle to take off fully laden in hot weather with less dense air. Climate change seems to be increasing air turbulence.

Hotter weather shrinks the ideal winter and spring tourist season, even as Saudi Arabia seeks to step up as a destination for global travel and sport alongside the UAE and Qatar.

And incidents like the extreme rain and flooding in the UAE in April can disrupt flight operations for days.

These are manageable challenges. More serious is the need to meet climate goals. The International Air Transport Association has committed to reach net zero emissions by 2050. The Gulf countries – particularly the UAE, Qatar and Saudi Arabia – have built big parts of their economic diversification schemes on aviation.

Emirates, Etihad, Qatar Airways and the others benefit from young, efficient fleets and a central geographic location. But they will have to play their full part in flight’s decarbonisation journey. Otherwise, Gulf airlines will steadily be buffeted by carbon taxes, punitive measures, bans or boycotts by companies with net zero goals or eco-minded flyers, and other headwinds.

A 10% SAF blend by 2030 may raise ticket prices by 4%, depending on the class of travel

Net zero for global aviation relies on four engines: sustainable aviation fuel (SAF) accounts for 65 percent of reductions, new technologies (including electric and hydrogen propulsion) for 13 percent, infrastructure and operating efficiency for 3 percent, and offsets and carbon capture (paying others to remove carbon dioxide) for 19 percent.

Even the business as usual case includes a hefty set of efficiency improvements. That is challenged by the aircraft makers’ current inability to deliver safe planes on time.

On a life cycle basis, SAFs emit only low net levels of carbon dioxide. Today, they are mostly derived from waste biological matter, such as used cooking oils. They can be blended with conventional jet fuel, although flights have also been demonstrated running on 100 percent SAF.

The EU’s target is that EU airports should provide a minimum of 2 percent SAF by 2025, 6 percent by 2030, 20 percent in 2035 and 70 percent by 2050. 

But last year, it accounted for just 0.2 percent of aviation fuel use. It is expensive: last year, while US aviation fuel sold at $2.85 per gallon, SAF cost $6.69. As fuel accounts for about a third of airlines’ operating costs, depending on oil prices, converting to higher shares of SAF will raise ticket prices. 

The US’s Inflation Reduction Act offers a subsidy of $1.25-1.75 per gallon for SAF use but is still not enough to bridge the cost gap on its own. Price rises need not be too onerous at first: a 10 percent SAF blend by 2030 may raise ticket prices around 4 percent, depending on the class of travel. They will be more serious towards 2050, unless there are substantial technological improvements.

And bio-SAF volumes are constrained. As waste feedstocks are snapped up, SAF will be made more from custom growth plants, but these face rules to avoid competing with food crops.

Within the EU goals, there is a sub-goal for non-biological SAF – synthetic fuels, most likely made from a base of hydrogen and carbon dioxide.

• The Gulf is well-placed to soar on SAF – but not yet
• Middle East airlines are leaders of the pack
• Masdar and Boeing work on SAF global acceptance

Gulf airlines have begun adopting SAF. The UAE aims to supply 1 percent of fuel to national airlines with domestically-produced SAF by 2031, and to produce 700 million litres annually, under its General Policy for Sustainable Aviation Fuel.

Finnish producer Neste has agreed to supply Emirates with more than 3 million gallons of SAF in 2024 and 2025, for flights from Amsterdam and Singapore, while Shell began supplying SAF at Dubai Airport last year.

The main UAE airlines’ reports suggest that Emirates consumed about 10.7 billion litres of jet fuel in its 2022-23 fiscal year, Etihad about 1.8 billion litres in 2022, and AirArabia’s UAE hubs about 0.8 billion litres in 2023.

If the national SAF production goal were achieved by 2031, it would be enough to supply about 5 percent of these three carriers’ needs, excluding others such as FlyDubai and non-UAE airlines, or twice that when considering outbound flights only.

Last year BP announced it was working with Abu Dhabi’s clean energy company Masdar and national oil company Adnoc, Etihad Airways and waste management company Tadweer to explore producing SAF in the UAE, both from municipal solid waste and hydrogen.

In October Masdar and Boeing agreed to advance the sustainable aviation industry. On August 1 Masdar signed an agreement with French oil supermajor TotalEnergies to pursue a SAF project based on green hydrogen.

This project would make hydrogen by splitting water with renewable electricity, then combine it with carbon dioxide captured from an industrial source, to make SAF and green methanol, an important fuel and chemical feedstock.

The announcement does not specify the production pathway, but there are a number of ways to convert hydrogen to SAF.

The GCC, with its large chemical and fuels industry, its world record low renewable energy costs, and ability to capture carbon dioxide at moderate costs on a large scale, should have an advantage in making synthetic SAF.

Costs here are currently even higher than for bio-based SAF, perhaps four to five times the price of conventional jet fuel, but with much greater potential for cost reductions.

Given the slow scale-up of production in Europe, the GCC could also export SAF there, a much easier logistical job than moving around pure hydrogen. It should find a ready market to satisfy the EU’s mandates.

Here is a golden opportunity to marry the Gulf’s strengths in aviation, traditional fuels and renewable energy.

Robin M. Mills is CEO of Qamar Energy, and author of The Myth of the Oil Crisis