Aviation biofuel investments grow in anticipation of global emissions tax

by Futures Centre, Jan 27
1 minute read

In our topic hub on the future of shipping, we’re asking who the future captains of the sea will be, as the prospect of an emissions tax increases.

A slew of biofuel partnerships and investments in the aviation industry in 2014 indicate biofuels may be ready to scale, moving beyond a ‘chicken and egg’ scenario in which industry investment awaits international legislation, and vice versa.

Cathay Pacific negotiated a long-term supply agreement with biofuel producer Fulcrum over ten years; British Airways announced a partnership with Solena Fuels, which has committed to building the world’s first facility to convert landfill waste into jet fuel. Within Europe, a consortium consisting of KLM, Amsterdam Schiphol, sustainable jet fuel producer SkyNRG, and the Dutch government, is working on a central biofuel blend for the common fuel supply system at Schiphol Airport, due to roll out in 2015.

Industry experts expect to see an international mechanism to put a tax on aviation emissions within the next two years. This would significantly alter the economics of low-carbon alternatives, and may be part of the motivation for this recent rise in investment.

Image credit: The Open University