PowerPoint Presentation...3,4394 kt 960 kT 1,248 kT 1,520 kT 7,164 kT 3,510 kT 4,073 kT 0.1-0.3 >0.3...

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1 STOCKTAKING 2020

Transcript of PowerPoint Presentation...3,4394 kt 960 kT 1,248 kT 1,520 kT 7,164 kT 3,510 kT 4,073 kT 0.1-0.3 >0.3...

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    SAF competitiveness and scale-up

    Christoph Wolff

    Chief Development Officer, European Climate Foundation – World Economic Forum

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    0World Economic Forum’s Clean Skies for Tomorrow ambition

    4: Create a scalable SAF market place

    5: Develop a blueprint for financing

    3: Align on an industry-backed policy proposal

    Ground work to create a fact base Enablers for scale-up

    2: Democratize global SAF supply

    1: Assess SAF feasibility andsustainability

    Design a SAF market-place and make a wave of first transactions, design and pilots in 2020, 1st wave of transactions in 2021

    Develop a blueprint for the financing of the transition to SAF, based on dialogues between aviation players and the finance community

    Align on proposed policy interventions to trigger learning curve effects and economies of scale that could benefit the rest of the industry

    Design a specific, comprehensive and actionable approach to scaling-up SAF in India and produce a blueprint for other regional pilots

    Refine and strengthen existing analyses on feedstock availability, technology readiness and production cost into a concise synthesis

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    Steering Committee

    And more…

    Knowledge Partners Advisory PartnersSecretariat Community

    Clean Skies for Tomorrow is a Global Coalition

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    0Sustainable aviation fuel expansion is a global theme

    XShare of emerging markets total energy demand, percent

    0

    200

    100

    300

    400

    500

    550

    50

    150

    250

    350

    450

    2020 25 30 35 40 45 2050

    Brazil

    India

    China

    Other

    emerging

    markets

    Other

    44% 45% 50% 53%

    5%

    7%

    3%

    4%

    3%

    Aviation energy demand, million tons of jet fuel

    CAGR '20-'50

    SAF in the focus

    Advanced biofuels require biomass such as used cooking oil, agricultural residues or municipal solid waste

    E-fuels / synfuel require captured carbon (from industry point source or directly from the air), and green hydrogen from renewable electricity

    Many emerging markets are well positioned to provide feedstock and green electricity at competitive costs

    Critical importance of emerging markets

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    Current Planned (2021)

    Emerging markets are major driver of global demand AND supply

    • SAF is the only large-scale decarbonization option for the industry until 2040+

    • There is enough sustainable feedstock available to power aviation in 2030 and beyond

    • Places best suited for large scale SAF production include India, LatAm, MENA and ASEAN

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    SAF competitiveness and scale-up

    Kamal Hingorani

    Chief Customer Officer – SpiceJet

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    0Goal: Fly 100 million domestic passengers on SAF by 2030

    India stands committed to reduce carbon emissions as committed in the Paris Agreement. The aviation industry, while a minor contributor, will play a crucial role by way of optics.

    India has become the third largest domestic aviation market in the world and is expected to overtake UK to become the third largest air passenger market by 2024.

    We have set upon ourselves a target to transport 100 million domestic passengers by 2030 on a 25% SAF blend; requiring 0.9 million tons of SAF.

    To achieve the above, price gap between SAF & ATF must be bridged, for which the primary contribution has to be made by the Government of India by way of tax polices & regulatory mechanisms.

    A public-private coalition through the World Economic Forum is now underway

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    SAF production costs 50-150% more than fossil jet fuel Additional levers can be explored with other stakeholders such as airport authorities, e.g.,

    differentiated airport landing fees for SAF flights or take-off charges on fossil jet fuel flights

    Government contribution Passenger contribution

    Gap to fossil jet fuel

    Reduce taxes on SAF

    flights

    Redistribute air ticket

    charges to airlines on SAF

    flights

    Provide funding for plants

    Passenger contribution

    Potential levers to bridge the gap to fossil jet fuelUSD bn

    Bring taxes down (in line with other biofuels)

    Redistribute share of fees e.g., passenger service fee, development fees

    Share of capex required for production plants

    Ambition in India:

    100million passengers fly domestically on SAF by 2030

    Scaling-up SAF requires a strategy to bridge the cost gap

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    Approx. USD 4 bn GDP impact

    ROUGH ESTIMATES BASED ON PRODUCTION OF 1 MT OF SAF IN INDIA

    Cleaner skies with less open-air burning

    Additional income for farmers (+10-15%)

    100,000+ new green jobs

    Catalyst for efficient waste management

    Enhanced energy security

    360 degree approach required

    India SAF expansion

    E2E supply chain and

    infra-structure

    Policy-making and regulation

    Feedstock and

    technology

    Buyers of SAF and

    side products

    Financial institutions

    Corporate and private

    end customers

    Scaling SAF industry would generate substantial GDP impact

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    Example India: Concentration of municipal waste and agricultural residues shows economically viable potential for 11 Mt of SAF

    SOURCE: ACRE McKinsey solution

    Practical feedstock availability… … allows for significant SAF production

    3,4394 kt

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    7,164 kT 3,510 kT

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    MSW availability, Mt of SAF output

    Kolkata

    Maharashtra

    Bangalore

    Telangana

    Chennai

    Delhi

    Visakhapatnam

    Lucknow

    Kanpur

    Jaipur

    Ahmedabad

    Nagpur

    Surat

    Mumbai

    Pune

    Hyderabad

    Agriculture residues (t/100km²)

    2

    50

    150

    250

    600

    1,000

    2,000

    4,000

    8,200

    65,000

    xx kt Total feedstock in hotspot

    Plants based on MSW closely located to large cities33Plants based on agricultural residues in six major hotspots 80

    11 million tons SAF output1

    1. Assuming average of 77% yield for AtJ and 55% for Gasification/FT and total output of 0.15 Mt p.a., ~0.6 Mt required feedstock p.a.

    ROUGH ESTIMATES

    India case example can serve as a blueprint for other regions

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    Thank You