GLOBAL aircraft manufacturer Airbus is urging swift and strong legislation to support the locally-produced sustainable aviation fuel industry, claiming it could bring significant economic benefits for Australian farmers.

SAF is produced using a range of non-fossil fuel feedstocks, such as oilseeds, crop residues, tallow and used cooking oil (UCO).

Currently, Australia exports volumes of canola, tallow and UCO to be processed into SAF, biodiesel and other renewable fuels.

Airbus chief representative for Australia and New Zealand Stephen Forshaw told Grain Central that Australia had the “potential to be a renewable liquid fuels superpower”.

He said this new industry would provide “potentially a new source of destination for what they are producing, including in some cases the waste that they are currently deriving no value for”.

“In the past have known that they produce a crop or whatever they are producing on their farm for a designed purpose, one purpose that is mainly related to food,” Mr Forshaw said.

“What we are now saying is that there is a lot of things…that can also supply Australia’s new liquid fuel needs.”

Policy crucial to success

Australia is the eighth-largest consumer of aviation fuel in the world, using about 10 billion litres each year, as well as a significant amount of potential feedstocks.

Mr Forshaw said legislation would be key to ensure SAF would be produced in regional communities from Australian feedstock.

He said getting the policy setting right was “absolutely critical”.

Stephen Forshaw

“Our argument is that you’ve probably got 12 to 18 months to get those [policy] settings right and, if you don’t get it right early, we will already be down the pathway of exporting all of our feedstock.

“I know that there are other projects in Australia…that we are not directly involved in that…are waiting for the government to settle the policy before they make the final investment decision.”

The Federal Government last month opened consultation on a roadmap for a low-carbon liquid fuel industry including ideas for demand-side measures.

Its 2024-25 Budget featured $18.5 million over four years to develop a certification scheme for low-carbon liquid fuels and the inclusion of the industry as a priority for the $1.7 billion Future Made in Australia Innovation Fund.

Mandates to drive demand

Mr Forshaw said Airbus “absolutely support” the introduction of enforceable mandatory minimum levels for the use of SAF in jet fuels.

He said mandatory levels would create clear demand for the product and ensure feedstock providers had a reliable market.

Mr Forshaw argued that legislation, such as mandates, would reduce the risk of projects “becoming challenged”, like recent examples from Australia and overseas.

These include Oceania Biofuels abandoning its $500M Gladstone project and Shell pausing construction of its SAF Rotterdam facility.

Grain growers have also been burnt by renewable fuel projects in the past, with the Dalby Bio-Refinery formerly buying large quantities of sorghum to produce ethanol.

However, the plant closed in 2020 after a lack of consistent demand and high grain prices made the operation unviable.

Mr Forshaw said “aviation cannot decarbonise at scale any other way in the short to medium term other than using SAF” which, alongside “the right policy settings”, would drive demand for the product.

Current project

With partner Qantas, Airbus is investing in projects to kick-start domestic production of SAF.

The companies have committed to jointly invest US$200M into the market to “companies looking to contribute to start up a SAF production ecosystem”.

A key investment is into Jet Zero Australia, a company which is progressing a proposed SAF plant in Townsville.

Known as Project Ulysses, it is the most promising of all planned SAF developments, and is currently working through the Front-End Engineering and Design process.

Jet Zero is targeting annual production of 102 million litres of SAF and 11Ml of renewable diesel.

It is anticipated that the plant would use agricultural by-products, most likely sugarcane residues, as its feedstock.

Mr Forshaw said a final investment decision on the project was expected by Q1 next year.

“We are very happy with how the project is developing.

“There will be a lot of issues that the company needs to address on the way through as part of the front-end engineering design work that is going on and ultimately addressing those issues is what will lead the company to making its final investment decision.

“We like their pathway, we like their technology and they’re ticking a lot of boxes as they go through.”

LanzaJet’s Freedom Pines facility in Georgia, US. LanzaJet is working with Jet Zero to progress the Townsville site. The proposed facility will be three times the size of the Georgia plant. Photo: Airbus

Jet Zero Australia also recently announced a joint-venture project with Singaporean biofuel company Aperion Bioenergy to develop low carbon-intensity feedstocks in Australia to help meet the demand for renewable fuels.

Although Aperion is considered one of the largest UCO collectors in Asia, the partnership has signalled that it would investigate the production of non-edible crops as well as pathways for sourcing waste oils.

Both companies will contribute capital to these goals, with Jet Zero expected to spearhead domestic investment in non-edible crop processing and refining.

They have also been awarded grant funding by Enterprise Singapore and the Australian Department of Foreign Affairs and Trade to progress feasibility studies on renewable feedstock production, processing, and refining.

Singapore example

Australia imports over 90 percent of its jet fuel, and almost all of its liquid fuel requirements coming from Singapore.

In 2023, Finnish sustainable fuel company, Neste, opened a SAF plant in Singapore capable of producing 1 billion litres per year.

With no domestic feedstock sources, Singapore is reliant on imports.

According to the Department of Agriculture, Fisheries and Forestry, at $392M, fat from red meat animals was Australia’s most valuable agricultural export to Singapore in 2023.

DAFF also reports that for 2022-23, Australia’s total inedible tallow exports exceeded $1B for the first time, a result of high global oil prices and demand from biofuel producers.

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