Sustainable Aviation Fuels

1Kati Sandberg & Pratik Chandhoke - Neste

TOPICS:

What you will hear about today:

Why the Aviation industry is reducing its CO2 emissions by switching to SAF?

What is SAF? How is it manufactured and regulated?

Blending SAF components with conventional Jet Fuel – a new critical step.

SAF is here to stay. The influence of Regulation.

2

What is sustainable aviation fuel? And why do we need it?

Why

● The blend component is 100%

renewable, low-carbon liquid fuel

● Most current technologies have

Paraffinic fuel component, no

aromatics

● Less GHG emissions and less

pollution

● Certified blend drop-in solution

available TODAY

What

Source „The right flightpath to reduce aviation emissions“, ATAG 2010

3

Source: ICAO 4

2009 2011 201620152014 2018

Fisher Tropsch

SPK

HEFA-SPKHydro

processed esters and fatty acids

SIPSynthesized iso-paraffins

ATJ-SPKAlcohol-to-jet (Iso-butanol)

ATJ-SPK Alcohol to

Jet (ethanol)

FT-SPK/AFischer-Tropschwith aromatics.

There are currently seven ASTM approved pathways to produce alternative aviation fuels.

SPK: Synthetic paraffinic kerosene

2020

HC- HEFA SPKCHJ

5

ASTM D4054 Evaluation Process is a rigorous process for SAF pathways approval

Source: http://caafi.org/focus_areas/fuel_qualification.html#approved

An important aspect of this process is to ensure that blend components behave the same way as conventional fuels in the distribution network and within aircraft systems and components

6

ASTM D4054 process involves four tiers of testing that might be required in order to approve SAF

Tier 1 Testing-Specification

Properties

- Related to Engine Safety

- Performance & Durability (ASTM D1655, DEF STAN 91-91, MIL-

DTL-5624, MIL-DTL-83133)

Tier 2 Testing – Fit for Purpose Testing

-Chemistry-Bulk Physical & Performance

Properties- Electrical Properties

- Ground Handling/Safety-Compatibility

Tier 3 Testing-Component/Rig Testing

- Turbine Hot Section-Fuel System

-Combustor Rig Tests

Tier 4 Testing- Engine/APU Testing

- Endurance Testing

Source: http://www.caafi.org/information/pdf/d4054_users_guide_v6_2.pdf

Tier 4 Testing- Engine/APU Testing

- Endurance TestingASTM D7566 specification

7

Assurance on sustainability requires verifying suppliers and origins of raw materials

CERTIFICATION AND AUDITS

Verification of sustainable production and handling of raw materials

SUPPLIER SELECTION

Sourcing only from approved counterparties having passed due diligence process

TRACEABILITY We know the locations of production units and estates

CONTRACT Sustainability requirements are included in contracts

DELIVERY MONITORING

Managing sustainability compliance for each physical delivery

8

SAF blends are a drop-in solution to the existing fuel supply chain and infrastructure

Fossil refinery

Blending terminal

Renewables refinery + distillation

Airport storage

Refueller/Hydrant

Waste & residue

Crude oil

Jet fuel:ASTM D1655 or DEF STAN 91-091 / AFQRJOS

ASTM D7566 synthetic component,(Neste SAF=Annex A2 for HEFA-SPK)

ASTM D7566 Table 1, max 50% allowed for HEFA-SPK

• Meets ASTM D1655 spec• Can be certified to meet DEF STAN

91-091 spec, if some additional parameters and requirements are met

• Meets AFQRJOS Checklist for JET A-1, if ASTM D1655 and DEF STAN 91-091 are met

9

Neste SAF is in use on a commercial basis around the world.

CALIFORNIAAlaska AirlinesAmerican AirlinesJetBlueDeltaDHLSignature & Netjets

NORWAY & SWEDENSAS, NorwegianLufthansa, KLMBusiness Aviation

NETHERLANDSKLM, DHL

FRANCEBusiness Aviation

GERMANY Lufthansa

Airbus

FINLANDFinnair

SWITZERLANDBusiness Aviation

UKCOP26Business Aviation

OEMsBoeingAirbusGulfstream

JAPANANA

Business Aviationmultiple locationsSignatureAvfuel

Source: Public Information10

RESTRICTED

M a n u fa ct u r in g J e t Fu e l – w h a t a r e t h e is su e s?

This is the critica l control point for the supply cha in. Ma ny a spects of the fue l ca n only be a ssured a t the point of ma nufa cture , especia lly those re la ted to composition.

The principle is hydroca rbon from a pproved sources, p lus a pproved a dditives only.

The ma in ta ble ca nnot cover a ll possibilities

Lots of experience of fue ls, tha t a re technica lly ‘on-spec’ a ccording to the test results, ca using opera tiona l problems in a ircra ft engines a nd a irfra mes

Specifica tions a re built up on the ba sis of experience over ma ny yea rs ra ther tha n comprehensive knowledge of wha t is good a nd ba d

Some specifica tion limits a re subtle , but importa nt.

1. 2 .

3 . 4 .

5 . 6 .

11

Rob MidgleyGlobal Technical & Quality Manager

Shell

RESTRICTED

M a n u fa ct u r in g – It ’s M o r e Co m p le x Th a n Yo u Th in k

Not Reprocessing Chemical Slops

Limits on Co -Processing Bio Components

Management of Positive Segregation

Tank Draining and Control of Microbial

Contamination

THERE ARE NO INDUSTRY STANDARDS FOR OVERSIGHT OF REFINERIES12

RESTRICTED

Su p p ly Ch a in s a r e Esse n t ia lly Sim p le

RO AD

RAIL

PIPELINE

BARGE

JET FUEL DEDICATED DISTRIBUTIO N

REFINERY

TERMINALAIRPO RT

MULTI-PRO DUCT DISTRIBUTIO N

13

RESTRICTED

Te r m in a ls – Se g r e g a t e a n d P r o t e ct Ex is t in g Fu e ls

Gross contaminationwith other products

Trace contaminationwith other products,dyes, additives or residues

Wa ter

Dirt, rust, sa nd e tc.

Product crossover

Exposure to ca ta lytic meta ls

14

RESTRICTED

Je t A-1

Bu t Th e Su p p ly Ch a in is Ch a n g in gJET A-1 (“SAF”). Identica l to Je t A-1

FEEDSTOCK PRODUCER

Synthe tic component must be ha ndled a nd tra nsported a s certified je t fue l

Blending depot ta kes on role

a ndresponsibilities

of ‘point of ma nufa cture’.

Including blend controls to

ASTM D7 566 . Relea sed a ga inst

DEF STAN 91-0 91 or ASTM

D1655 .

Component certified meeting Annex of ASTM D7 566 , CoQwith ba tch

SAF COMPONENT

Susta ina ble source

Certifica te

PROCESSING PLANT

INTERMEDIATE SUPPLY

(BLENDING) DEPOT

AIRPORT

SUPPLY DEPOT

REFINERY

Refinery produces Je t A-1. CoQ a ccompa nies ba tch 15

RESTRICTED

Ble n d in g Po in t – N o w Be co m e s a Po in t o f M a n u fa ct u r e .

Control of Conventional Component Composition

Proper Management of Change Oversight

Gross contaminationwith other products

Trace contaminationwith other products,dyes, additives or residues

Wa ter

Dirt, rust, sa nd e tc.

Product crossover

Exposure to ca ta lytic meta ls

16

RESTRICTED

SUSTAIN ABLE AVIATIO N FUEL IS THE M O ST EFFECTIVE SHO RT TO M EDIUM TERM O PTIO N

A drop in solution for current a nd future flee ts, like ly to be flying until a t lea st 2 0 50 .

Blended with JET toda y a nd potentia lly used nea t in the future .

Airport ha ndling a nd a ircra ft sa fe ty issues ma na ged like norma l je t.

Susta ina ble source –supporting circula r economy.

17

RESTRICTED

SHELL IS IN VESTIN G IN A VARIETY TECHN O LO G IES FO R THE AVIATIO N IN DUSTRY

1G Biofuel• Low carbon biofuel blends• Used cooking oil (UCO)

HEFA HVO

Advanced Biofuels• Next gen, low carbon biofuels• Municipal waste / wood res

NBS• Nature Based Solutions to offset

carbon

NBS

Hydrogen• Low carbon fuel solution for future

aircraft• Water

PTL• Power to Liquids Technology Direct

air/emissions capture E-Fuels• CO2

E-Mobility• Battery electric or e-hybrid aircraft• Green Electricity

E-Fuels

18

RESTRICTED

SO LUTIO N S TO ACCELERATE DECARBO N ISATIO N FRO M SAFLO W ERIN G TO N ET ZERO

19

CO LLECTIVE ACTIO N S

Sca le-up volunta ry dema nd for SAF. Tra ding pla tform to crea te a fina ncing

mecha nism. G loba l a greement on SAF ma nda tes by

governments. Cha mpion R&D to drive new a nd susta ina ble

technologies.

PO LICY LEVERS

Introduction of ma nda tes for use of SAF globa lly. Stimula te supply a nd feedstock. Stimula te fina nce by derisking investment,

including price differentia l be tween SAF a nd conventiona l fue l.

Address ca rbon lea ka ge.

Technologies, Feedstocks &

Regulatory Impacts

20

21

Schematic overview of the climate effects of aviation

Many different climate effects from Aviation:- CO2, NOX and soot- Contrails- Aerosols and Sulphates

They may have positive and negative impacts.

Short and long term impacts

Very complex and sometimes difficult to measure

Best-estimates for climate forcing terms from global aviation22

Best-estimates for climate forcing terms from global aviation from 1940 to 2018. The bars and whiskers show ERF best estimates and the 5–95% confidence intervals, respectively. Red bars indicate warming terms and blue bars indicate cooling terms. Numerical ERF and RF values are given in the columns with 5–95% confidence intervals along with ERF/RF ratios and confidence levels. RF values are multiplied by the respective ERF/RF ratio to yield ERF values. ERF/RF values designated as [1] indicate that no estimate is available yet.Source: EASA 2020 and Lee et al. (2020).

SAF technologies will mature and ramp up in 3 stagesDevelopment of European SAF capacity in Mt

Source: World Economic Forum & McKinsey & Company, Clean Skies for Tomorrow Insight report, November 2020

PTLAtJG/FTHEFA

Stage 3

Stage 2

Stage 1

23

HE

24

SAF will remain more expensive than fossil Jet Fuel. Prices will come down as technologies mature

Development of production costs of SAF and comparison to fossil Jet Fuel

Source: World Economic Forum & McKinsey & Company, Clean Skies for Tomorrow Insight report, November 2020

PTLAtJG/FTHEFA Fossiles Jet Fuel

25

Regulatory frameworks enabling SAF growth are forming.

Some examples: AVIATION SPECIFIC BLENDING OBLIGATIONS:

• Provide demand certainty for SAF producers

OPT-IN SCHEMES TO FULFILL ROAD TRANSPORT MANDATES:

• Enable fast scale up of SAF demand

Mandate introduced in 2020

Plans to introduce a mandate in the future (2021-2025) & Opt-in schemes to be implemented from 2021 onwards (e.g. EU RED* II)

Aviation opt-in for road transport mandates in place

Opt-in schemes to be implemented from 2021 onwards (e.g. EU RED II and Canada Clean Fuel Standard)

Plans to introduce a mandate in the future (2021-2025) & Aviation opt-in for road transport mandates in place

* Renewable Energy Directive26

27

In conclusion, sustainable aviation fuel is ready for takeoff

• Sustainable Aviation Fuel must be part of the solution to make air travel more sustainable

• SAF can be produced from various renewable and sustainable feedstocks using the seven approved pathways

• SAF pathways have to go through extensive testing regime in order to show that no changes will be needed to fuel handling procedures and systems, aircraft certification or safety requirements

• SAF and blends meets all the rigorous certifications similar to conventional jet fuel

• SAF is a hydrocarbon based fuel that can be used with existing infrastructure when blended

Safe travels ? – and remember to lower your own environmental footprint!

27

Q&A session

28

29