Discussing sustainability with the President of Shell Aviation, Jan Toschka
At the World Aviation Festival in Amsterdam, I sat down with Jan Toschka, President of Shell Aviation to discuss sustainability.
We covered:
- Different ways the sustainability discussion has shifted in recent times.
- How seriously the industry is taking the need to decarbonise.
- Current barriers to the broader use and production of Sustainable Aviation Fuel (SAF).
- Shell’s new blockchain powered book-and-claim solution Avelia, and how it will increase the production of SAF.
- The importance of collaboration for meeting sustainability needs.
The industry has set its sights on SAF as one of the keys levers to decarbonise aviation. Defined as “renewable or waste-driven aviation fuels that meets sustainability criteria,” SAF has the potential to reduce lifecycle emissions by 80 per-cent when used in neat form.
Through replacing traditional jet fuel with SAF, the industry can hope to significantly reduce its carbon footprint. Consequently, SAF plays a large role in many airlines’ sustainability roadmaps. However, right now this costs two to eight times more than traditional, carbon emission heavy, jet fuel.
This cost creates a chicken and egg problem that Jan explains in the interview. On one side, airlines struggle to make commitments and on the other, fuel providers are lacking the strong demand signal to invest at scale and increase production, which in turn dampens demand because of SAF’s price premium. The Air Transport Action Group estimates that up to $1.45 trillion worth of investment over the next 30 years will be needed for scaling up production. During the interview, Jan discusses this dilemma and explores what steps are needed to overcome this to ensure there is enough SAF to satisfy demand.
One of Shell’s priorities is collaboration across the value chain to unlock demand in order to de-risk investment and grow confidence for SAF production and use. Shell has made headlines in the recent months – for example, in August 2022, Shell signed a landmark memorandum of understanding (MoU) with Lufthansa over a potential purchase agreement which could deliver up to 1.8 million metric tonnes of SAF over a seven-year period, starting 2024. When considering the ‘chicken and egg’ problem, MoUs like this one play an important role in helping to gain confidence that’s needed to scale up SAF production.
As a concentrated segment that also needs to decarbonise, business travel is uniquely positioned to play a role in scaling SAF demand. Jan explained how their blockchain powered book-and-claim solution Avelia is helping to decarbonise business travel, giving corporations the ability to buy SAF and receive its environmental benefits regardless of their geographic location.
Finally, the importance of collaboration was emphasised as it becomes increasingly apparent that airlines, corporates, governments, and suppliers must all work together to ensure the industry can make the required shift to sustainability.
Article by Jess Brownlow
