Air France: SAF 'Overcost' Must Be Addressed To Reach Sustainability Goals
LE BOURGET—Air France’s ambition to use 10% sustainable aviation fuel (SAF) by 2030 would add €1.3 billion ($1.4 billion) to the airline’s costs if prices of the alternative to conventional jet fuel do not fall, CEO Anne Rigail says at the Paris Air Show.
She notes that the “overcost” of SAF is one of the air transport industry’s biggest challenges as it seeks to decarbonize.
In 2023, SAF incorporation will already add €100 million to Air France’s costs.
“When we look at 2030 with the commitment of 10% of SAF, if the SAF is at the same price as today, it will be €1.3 billion. When you look at airline margins, [which] are a bit tight and cyclical, we see that it will be very difficult, if not impossible, to incorporate this overcost in the business model of the airlines,” Rigail says. “What we need collectively to aim at is to lower the price of SAF.”
Rigail, speaking at the Paris Air Lab—aimed at showcasing green innovation as part of the air show in Le Bourget—says Air France is already a “SAF pioneer," using about 17% of all SAF produced worldwide last year, compared to its requirement of approximately 3% of worldwide SAF production.
“For an airline like Air France, where our footprint is 80% coming from long-haul flights, SAF is a decisive lever—without it, we can’t manage to meet the industry targets,” she says.
With fuel representing 20-30% of an airline’s cost, incorporating SAF, which is currently 3-8 times more expensive than traditional fuel, is a challenge.
Rigail says: “Jet fuel is currently €800 ($875) per [metric ton]—when we buy SAF, it’s €3,500 per [metric ton]. In France, it’s more expensive to be compliant with the French mandate, so it’s €5,000 per [metric ton]. When we buy SAF in the U.S., because there are local and federal incentives, we can find SAF with the same criteria in terms of environment at €2,000 per [metric ton]. Our challenge is to lower the overcost of SAF.”
While ticket prices are already higher in 2023 because of SAF incorporation, a flight from Nice to Singapore in 2030 at current SAF prices would cost €110 more for an economy passenger, Rigail says, creating the risk that passengers choose different, cheaper routings. “If it stays like this, it would mean traffic [shifting] onto other hubs.”
Air France has committed to its 10% SAF by 2030 target, which goes beyond industry-wide goals, because “we want to send a signal to the industry that it’s time to scale up the production of SAF,” she says, noting that the airline is pleased the French government last week announced further green aviation investments, including a domestic SAF project.
But France, where there are currently four e-fuel projects—compared to 13 in Germany—needs to go further, she adds. “We know that we have to support the emergence of e-fuel production factories."
Countries such as the U.S., which have provided strong incentives for SAF production, are seeing the impact, Rigail says.
“The challenge is taking on SAF as much as possible where we are taking off so as to avoid transporting it, which reduces somewhat its potential for decarbonization,” Rigail tells ShowNews on the sidelines of the show. “The challenge is making sure production increases wherever we operate from...Historically we have been using a lot of SAF on flights from San Francisco and Los Angeles because there has been [SAF] available,” she adds.
Rigail points to the other major lever in Air France's decarbonization plan—fleet renewal—noting that it is still receiving aircraft from the orders for 60 Airbus A220s and 41 A350s it has previously placed.
Asked if the airline would make any statement about further short- and medium-haul fleet replacement plans, Rigail says Air France does not have any "specific announcement" in that regard. She adds: "We have our A220s that are arriving until 2025, replacing our short- and medium-haul fleet. We’re thinking about the next steps for our fleet every day, of course—our objective is 70% [new-generation aircraft] in 2030.”
Compared to a level of 4% of new-generation aircraft before COVID, Air France expects to have 30% by the end of 2023. The airline is also pushing initiatives such as taxiing with only one engine, optimizing routings and reducing weight onboard to cut its environmental footprint.
“Everyone is committed in [Air France],” Rigail says.
