SABA Enters Historic Agreements for Acquisition of SAF Certificates

On April 17, 2024, the Sustainable Aviation Buyers Alliance (SABA) disclosed a record-breaking series of agreements aimed at procuring high-integrity SAF certificates (SAFc). Over the course of five years, a consortium of companies, including AstraZeneca, Autodesk, Bain & Company, BCG, Deloitte, JPMorgan Chase, Live Nation, McKinsey & Company, Meta, Morgan Stanley, Netflix, Novo Nordisk, Samsung Biologics, Watershed, and Workday, alongside SABA's founding organization RMI, have committed to investing nearly $200 million in the acquisition of SAFc. This substantial investment is equivalent to approximately 50 million gallons of high-integrity SAF or 500,000 tons of abated CO2e, roughly comparable to the emissions produced by 3,000 fully loaded passenger flights from New York City to London.

This series of agreements spanning multiple years involves nearly 20 corporate aviation clients, four fuel suppliers, and three airlines, showcasing the significant influence of corporate demand in amplifying investments in promising sustainable fuels aimed at advancing the aviation industry's decarbonization efforts. Several participants are entering the SAFc market for the first time, underscoring the pivotal role played by SABA in reducing entry barriers and enlightening stakeholders, thereby contributing to the development of the SAF certificate market.

Sustainable Aviation Fuel (SAF) is a readily deployable fuel derived from renewable or waste sources. It seamlessly integrates into current aircraft and infrastructure without necessitating costly fleet upgrades, thereby offering a substantial reduction in flight-related carbon emissions. SAF obtained via the SABA transaction attains an average 80% reduction in carbon intensity compared to conventional jet fuel, with its sustainability credentials verified by independent third-party certifications throughout the supply chain. Despite the industry's rapid expansion, SAF constitutes less than 0.5% of the global jet fuel supply and currently commands a premium over fossil jet fuel.

Elizabeth Sturcken, Managing Director at Environmental Defense Fund and a co-founder of SABA, emphasized the significance of leading global corporations advocating for high-integrity sustainable aviation fuels. Sturcken underscored the immediate availability of such fuels and emphasized the urgency to swiftly increase their production to facilitate the decarbonization of air travel. She praised the pivotal role played by the Sustainable Aviation Buyers Alliance in assisting companies in identifying and procuring the most reliable sustainable aviation fuels, thereby accelerating progress towards achieving net-zero objectives.

Acquiring SAF certificates empowers corporate travelers to contribute to the adoption of sustainable aviation fuel (SAF) and reap its environmental advantages, even if the fuel is not directly utilized in the aircraft they fly on. By investing in SAF certificates, travelers can assert a reduction in greenhouse gas emissions on their climate disclosures, while the physical SAF is directed to an aircraft operator.

Through this initiative, SABA is spearheading novel approaches to the procurement and distribution of SAF certificates. SABA members collaborate with airline partners such as Alaska Air, JetBlue, and Southwest, obtain certificates via SAF solutions provider SkyNRG, and directly purchase from fuel providers, including significant, multi-year agreements with World Energy.

This series of agreements encompasses the procurement of various fuel varieties, including innovative power-to-liquids (e-fuels) produced by Twelve, in collaboration with Alaska. Utilizing renewable electricity and CO2, this fuel boasts minimal greenhouse gas emissions and holds significant potential for scalability.

The multi-year agreements play a vital role in expanding the scale of the sustainable aviation fuel (SAF) market. Providing long-term assurance regarding demand assists fuel producers in obtaining financing for future plant expansions, thereby facilitating the increased availability of sustainable aviation fuel in the market.

This multi-year procurement initiative builds upon the achievements of SABA's inaugural procurement effort last year, which united prominent aviation clients in purchasing SAF certificates equivalent to nearly 850,000 gallons of high-integrity sustainable aviation fuel. By broadening the procurement scope to encompass numerous fuel providers and airlines, SABA customers can now invest in various fuel varieties, thus facilitating the introduction of innovative technologies to the market.

While the SABA-led transaction marks a significant milestone, it has also underscored the considerable effort still needed to achieve global aspirations for decarbonizing air travel. The available volumes of sustainable aviation fuel (SAF) meeting SABA's criteria fell far short of satisfying the full demand from SABA customers in 2024 and 2025. SABA is committed to expanding its collaboration with corporate customers, airlines, fuel providers, standard-setting bodies, and other NGOs to establish a robust and scalable market for SAF certificates. Plans are underway for a new collective procurement process that will combine forward-looking agreements for innovative fuel technologies with mechanisms enabling companies to purchase commercially available, high-integrity SAF certificates on an ongoing basis.