British Columbia has recently implemented a groundbreaking regulation, the “Low Carbon Fuels (General) Regulation,” which constitutes a significant step towards fuel decarbonization, including aviation.
A dual incentive for decarbonization, including aviation
On one hand, the regulation mandates an increasing incorporation of renewable kerosene into aviation fuels. Starting in 2028, a 1% incorporation of renewable kerosene will be required, increasing to 2% in 2029 and 3% in 2030.
On the other hand, a compensation mechanism has been established, requiring a reduction in the carbon intensity of aviation fuels. This reduction, set at 2% starting in 2026, will gradually increase to 10% by 2030.
A global and national context driving decarbonization
British Columbia is part of a series of similar initiatives in Europe, the United States, Canada, and globally with the International Civil Aviation Organization (ICAO). The overarching goal is to achieve a 5% incorporation of sustainable aviation fuels (SAF), while the USA, Canada, and Europe are aiming for more ambitious targets of 10%.
In Canada, organizations such as Advanced Biofuels Canada and C-SAF are recommending more robust measures to support the availability of SAF in the country.
British Columbia took an early lead over the federal government by implementing a clean fuels standard back in 2009, partly inspired by California’s regulations. While the federal government followed suit with its own regulation in 2022, British Columbia continues to set an example, now including mandatory targets for kerosene, particularly for aviation.
Price and outlook
The cost of sustainable aviation fuels varies, but SAF price indices based on recycled cooking oil ranged from 2,000 to 3,280 USD per tonne in 2022. In Canada, although initial demand is modest compared to total aviation fuel consumption, it will help secure local production projects.
SAF can be produced from various sources, including grease residues, vegetable oils, agricultural or forestry residues, and even ethanol. While some challenges remain, including feedstock availability and reputational concerns, the sustainable aviation fuels market offers significant growth potential for Canada.
Key takeaways
By introducing ambitious measures for fuel decarbonization, including for aviation, British Columbia is setting the pace for a more sustainable aviation sector. However, concerted efforts at the national level will be necessary to support local production and facilitate an effective transition to fuels that account for all environmental and social impacts. Indeed, a fuel whose production method competes with food crops cannot be considered sustainable, especially in the context of rising food prices. Finally, the sector will not be able to avoid a difficult debate on the role it can play in a world that must drastically reduce its greenhouse gas emissions.