Story ID: 347
Book-and-claim Crucial to SAF Expansion
By: Curt Epstein
Caption: Book-and-claim enables anyone, anywhere to purchase SAF credits
Word Count: 970
Sustainable aviation fuel (SAF) is widely considered to be the solution with the greatest potential to help the aviation industry reach decarbonization goals, and the introduction of industry book-and-claim programs is the tool that is going to help advance its production and adoption.
While the global supply of SAF this year is expected to triple 2023’s total, reaching 400 million gallons of neat (100%) SAF, it still only accounts for less than half a percent of the amount of jet fuel consumed. In the U.S., the fuel is available primarily on the West Coast due to tax and credit incentives for production and distribution of low life cycle carbon emission fuels.
SAF is now available to business aviation customers at approximately 30 FBOs in the U.S., and a similar amount in the rest of the world, mainly in Europe. To airports near the SAF production facilities, the renewable fuel can be easily transported. But, beyond a certain distance, the costs of transport and resulting environmental penalties begin to weigh upon the price and erode the benefits of the fuel.
SAF’s carbon emissions savings over conventional jet fuel are calculated on a life-cycle scale, including transportation to the end user. If it is trucked hundreds of miles, those subsequent emissions must also be factored into the equation.
“There are airports where the distribution points are close to the producers that have the right tax incentives or the right subsidies in place…where it just makes sense to put the fuel. You are going to get the cheapest cost per gallon,” said Kennedy Ricci, president of industry sustainability solutions provider 4Air. "If we tried to truck it to Teterboro, you are probably going to pay double or triple the amount that you pay for putting that fuel in in California."
With the physical fuel sequestered in a geographic area, and with an industry customer base around the country, book-and-claim programs were instituted. These programs enable operators to pay a “green” surcharge to obtain the environmental benefits and carbon reduction credits anywhere, without the actual fuel being pumped into their aircraft. Instead that fuel is pumped into another aircraft.
“That’s how the process needs to work,” said Beatrice Batty, Signature Aviation’s director of fuel planning and risk. “You have to be able to separate the physical molecules from the carbon attributes and of course the premium for it to be able to create that SAF book-and-claim credit, but the gallon [of SAF] has to be put into the aviation system to be burned.”
She added that the green surcharge or price delta for a SAF blend is currently around $1.50 a gallon above the cost of conventional jet-A, due to the higher production costs associated with the refining of neat SAF. Signature is the largest SAF retailer in the business aviation sector, having sold more than 35 million gallons of blended SAF since 2020.
“We saw the need [for book-and-claim] very early on,” Batty explained to AIN. “When we started looking at how [to] get SAF to our customers, we realized that because of the very immature production landscape and that it was only focused in California—yet there is so much demand elsewhere—we recognized that book-and-claim was going to be a necessity to help get adoption and a greater flow of product into the marketplace. We will need book-and-claim until we get a more large-scale production landscape throughout the world, but especially in the United States.”
The ability to keep accurate records of SAF usage for reporting purposes is crucial to an operator’s environmental, social, and governance plans.
“SAF is different from jet fuel in that where it comes from determines how sustainable it is,” said Ricci. “The blend of the fuel [and] the feedstock of the fuel determines what you can actually claim from using it. It’s not all created equal. You need robust documentation showing which batch you used, what blend it was, and if you purchased it [so] you can actually claim those benefits.”
The backbone of book-and-claim is a strong ledger system that tracks the volumes of fuel and prevents double booking of the carbon emissions reduction claims.
“We are audited every single year on all of our transactions,” said Batty. “There are some customers that want every single piece of detail and for us to prove all of that—and we do. They have it independently audited as well to prove that they can make the claim that they do.”
To provide further confidence in the system, groups such as the Council on Sustainable Fuels Accountability (CoSAFA) are working to provide standardization, paving the way for worldwide acceptance of the process. “We are supporting and providing the publicly available, neutral, generally accepted accounting principle similar to the GAAP [generally accepted accounting principles] as you see in the financial markets the way public disclosures are done,” said CoSAFA executive director Madison Carroll.
According to Carroll, there are now at least 10 fuel programs offering book-and-claim, each of which had to develop its own bookkeeping methodology. She expects that number to continue to rise until consolidations begin to take hold. “We are trying to standardize the way SAF transactions work,” she added.
Ricci said 4Air has seen growing acceptance for the process. “At the end of the day, people prefer to have physical fuel, but we don’t have the availability for that today,” he said. “Book-and-claim, hopefully by 2050, is a mechanism we won’t need with widespread SAF distribution and the ability to use it at any airport. But until then, it is a key mechanism to help in the early stages.”
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