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EconomicsIn the short term economics is the major hurdle to overcome for the deployment of alternative fuels in aviation.Current assessments converge on an lack of competitiveness of alternative fuels compared to conventional jet fuel in the initial development phase before best practices, progress in production technology and economies of scale can bring about meaningful cost reductions. Incentives, or compensation mechanisms for the environmental benefits of using these fuels, are required to bridge the price gap in order for airlines to buy the fuels and to create a market perspective that will attract investors and reduce the perceived risk of this emerging industry. ICAO is currently working with Member States, technical experts and stakeholder groups to integrate alternative fuel into the developing Global Market Based Measure (GMBM). This integration would help incentivise the use of sustainable alternative aviation fuels. Renewable energy policies, which exist in most countries, support the deployment of biofuels for road transport through mandatory production quotas and fiscal incentives. A level playing field needs to be created for aviation in order for fuel producers to also consider this market, where technical requirements for fuels are also more stringent. Beyond supporting measures, a key to the deployment of alternative fuels in aviation is to bring costs on par with fossil fuels. This requires improving efficiency and reducing the costs of both transformation processes and feedstock production, which will necessitate further support and investments in research and development, as well as the demonstration and scale-up of technologies. Reference:
ICAO SUSTAF experts group report, “The Challenges for the Development and Deployment of Sustainable Alternative Fuels in Aviation”, May 2013. Feedstock availabilityOver the longer term, the availability of sustainable feedstocks is a significant challenge for the commercial-scale deployment of alternative jet fuels as a means to achieving aviation environmental objectives. In addition, feedstocks are a major contributor to the cost of alternative fuels. Development of feedstock production needs to be included in supporting policies, as well as in research and development efforts. Innovation in feedstocks and technologies which require minimum resources in terms of land and water quality and nutrients, is key for the large scale deployment of alternative fuels. Feedstocks are also at the core of the sustainability of alternative fuels. Reference:
ICAO SUSTAF experts group report, “The Challenges for the Development and Deployment of Sustainable Alternative Fuels in Aviation”, May 2013. SustainabilityIf the use of alternative fuels has the potential to significantly reduce GHG emissions, their deployment at commercial scale is likely to have a broad scope of environmental, societal and economic consequences, in particular because of the large amount of biomass that could be needed. Depending on the solutions adopted, producing large volumes of biomass may have a high impact on land and water use, as well as biodiversity. Other scenarios that must be considered include the possibility that these changes could generate soil degradation and pollution from chemical fertilizer use, and induce important changes in rural society and local communities. The aviation sector recognizes the need for the sustainable development of alternative jet fuels, in accordance with the three pillars of sustainability - environment, society and economics. This management requires developing policies for the deployment of alternative fuels that include sustainability targets and associated dedicated measures to ensure sustainability. Such measures should build on a combination of the approaches that have already been developed in the field of bioenergy. The voluntary certification of alternative fuel production chains is a way to ensure sustainable practices at value-chain level, while implementing a monitoring system at a national level, based on a sound set of indicators, allows for better control of the global and cumulative impacts, and to inform decision-making. Informed decision-making in the development and implementation of biofuels policies and strategies is key to minimizing risks and ensuring sustainability. An assessment of the sustainable bioenergy potential of the country is essential in this process. A significant challenge today regarding sustainability is the assessment of the indirect impacts of a large scale deployment of alternative fuels. Induced land use change (ILUC) and impacts on food security are particularly debated. ILUC is the land-use change induced in a different geographic area by the deployment of energy crops in one locale which leads to the displacement of previously existing crops. It is not directly observable and is recognized to potentially create GHG emissions. Food security is also indirectly affected by the effect on prices and agricultural commodity markets of an increased demand for biomass. The assessment and management of these impacts is currently not fully mature and requires additional research and methodological work. Reference: ICAO SUSTAF experts group report, "The Challenges for the Development and Deployment of Sustainable Alternative Fuels in Aviation", May 2013. To learn more about sustainability: read "Approaches to the Sustainability of Alternative Fuels in Aviation"