Qantas and Airbus Near First SAF Investment
An executive from Airbus revealed that Airbus SE and Qantas Airways Ltd. will be announcing their first investment towards a sustainable aviation fuel (SAF) industry in Australia from a $200 million fund in approximately a month.
Following Qantas' commitment to incorporate 10% sustainable aviation fuel (SAF) in its fuel mix by 2030 and a multibillion-dollar order for Airbus narrowbody and widebody planes, the two companies established the fund last year.
Australia currently does not have a sustainable aviation fuel (SAF) industry, which means that Qantas has to purchase the fuel from overseas airports.
According to Stephen Forshaw, the chief representative for Australia, New Zealand, and the Pacific at Airbus, the two companies have been meeting weekly to discuss early-stage SAF projects in Australia that require investments of $1 million or more. Although the first investment has been agreed upon, it has not been fully finalised yet. Forshaw stated that announcements about its completion will likely be made within the next month.
Forshaw also mentioned that most of the investments being considered are seed funding, which may involve the partners taking a minority equity stake.
Forshaw mentioned that some of the investments being considered are in their early stages, even earlier than Series A. These investments could provide the companies with a right of first refusal to participate in Series A, Series B, or later rounds. The decision to do so would depend on the pace of progress and whether they see it as an appropriate time to involve other investors.
Although Forshaw did not disclose the specifics of the first investment, he mentioned that Australia has great potential for solar-powered projects that could help meet demand in the long run, given the limited feedstock available from sources like oils and fats.
Qantas Chief Sustainability Officer Andrew Parker recently stated that the airline could achieve its 2030 target of 10% sustainable aviation fuel (SAF) solely through purchases in London and California if needed, but he also noted that 70% of the airline's total fuel was sourced from Australia. Parker emphasised the need for the airline to take a lead role in developing a domestic SAF industry and expressed the possibility of local production by the latter half of this decade.
To achieve its target of net-zero emissions by 2050, Qantas aims to have approximately 60% of its fuel made up of SAF.