1、INSTITUTE OF ENERGY,PEKING UNIVERSITYTHE PRESENT AND FUTURE OF SUSTAINABLE AVIATION FUELS IN CHINA Institute of Energy,Peking UniversityOctober 2022致 謝Cover picture:Photo by Rudragos on PixabayThe Institute of Energy,Peking University is an independent energy think tank under Peking University.The I

2、nstitute focuses on strategic policy research,cutting-edge technology research and development,education and training,international exchange and cooperation in the field of energy,and strives to become a top energy think tank.Taking advantage of Peking Universitys strong academic foundation and a wi

3、de array of disciplines,the outstanding faculty members from inside and outside the university,the convening power in education and research,the Institute works with global partners to provide smart solutions for sustainable energy transition.CLIMATE CHANGE AND ENERGY TRANSITION PROGRAM(CCETP)The In

4、stitute of Energy,Peking University launched the Climate Change and Energy Transition Program in March 2021,aiming to help China address climate change and promote energy transition to peak its carbon emissions by 2030 and achieve carbon neutrality by 2060.The program provides policy recommendations

5、 and support to the Chinese government by setting science-based ambitious goals and formulating clear roadmaps and effective action plans.The program encourages Chinas energy industry to be safer,greener,and more efficient,and helps China reduce and ultimately phase out the use of fossil fuels.The r

6、esearch areas of the program include the macro analysis of the coordinated development of energy,environment,economy and society,as well as the following:Fossil fuel consumption cap;Innovation in energy technologies;The power sectors transition to a system dominated by renewable energies;Promotion o

7、f electrification;Low-carbon and green development of energy-intensive sectors;Sustainable transportation;Demonstration and promotion of regional,provincial,and municipal carbon-neutral models;Reduction of dispersed coal and plastic consumption;Carbon Neutrality,carbon sink,carbon market;Energy just

8、ice and just transition,etc.THE PRESENT AND FUTURE OF SUSTAINABLE AVIATION FUELS IN CHINA DING YIRU1,YANG LEI1,ZHENG PING1,WANG QIANYU1 AND LV JIXING2October 20221 Institute of Energy,Peking University2 Civil Aviation University of ChinaACKNOWLEDGEMENTSThis report is developed by the Institute of En

9、ergy,Peking University.Sustainable aviation fuels(SAF)plays a vital role in carbon emission reduction in the global aviation industry,but the corresponding research work is still lacking,especially in China.In view of this,we organized this research,which lasted for one year,to find out the current

10、situation of the China market and make a preliminary prospect for the future.It is our hope that this research could inspire more further exploration in this field.When researching for the purpose of and preparing the report,we were fortunate to have support from experts from many government agencie

11、s,industries and research institutes.Thanks to their first-hand information and professional feedback,this report is able to provide a panoramic view of sustainable aviation fuels in China.Here,we want to express our gratitude to them for their strong support.Our special thanks go to:Gao Hua and Xia

12、ng JinjingArgus MediaLi YaoguangBeijing Haixin Energy Technology Co.,Ltd.Dong Yan and Chao WeiBeijing Shougang LanzaTech New Energy Co.,Ltd.Wang Shiyao and Xu YaohuaS&P Global Inc.Chen Min,Chen Lixian,Li Lin and Wang ZhaoBoeing ChinaWang Huan and Gu XianChina,Air BP Xing ZihengCathay Pacific Airways

13、 Limited Zhu Cuihan and Zhang LingyingHangzhou Energy Engineering Technology Co.,Ltd.Zhang Wei,Yu ZhanfuRoland Berger Li Haixing,Peng Min and Han RenhuaShell China Ma Teng,Xupu TianzheNational Biodiesel Industry Cooperation Group Liu ShutongMotionECO Wang TongjiaZhongdiyou New Energy(Shandong)Co.,Lt

14、d.Gong Feng and Zhao HenghuiChina National Aviation Fuel Group LimitedWang ChenguangGuangzhou Institute of Energy Conservation,Chinese Academy of Sciences Yang XiaojunCivil Aviation University of China Yu JingleiChina Academy of Civil Aviation Science and Technology Xiang HaiThe Second Research Inst

15、itute of CAACYang ZhiyuanAviation Fuel/Oil and Aerochemicals,Airworthiness Certification Center of CAACZhang XiaoliChina Southern Airlines Huang AibinSinopec Zhenhai Refining&Chemical CompanyMoreover,we also want to thank Zhang Zhe,Lv Mingxu and Liao Yanguang for their assistance in documentation.Th

16、e authors are truly thankful to Boeing for its support of this research project.Should you have any advice or suggestion,please contact us at .TABLE OF CONTENTSExecutive summary xAbbreviations&glossary xiichapter 1 The global aviation industry and carbon emissions reduction 11.1Updates of the aviati

17、on industry development 21.2Progress of the aviation industry in carbon emissions reduction 4chapter 2 The role of SAF in aviation emissions reduction 72.1Main measures adopted by the aviation industry to reduce emissions 82.2SAF will be the most important reduction measure 92.3It is critical to dra

18、matically increase SAF production and consumption 9chapter 3 Technical pathways to producing SAF 113.1The status of production 123.2The prospects of development 14chapter 4 SAF administration,laws,and policies in China 174.1Laws and policies 184.2Airworthiness certification 20chapter 5 Main SAF mark

19、et participants in China 235.1Producers 245.2Suppliers 265.3Users 27chapter 6 Outlook for SAF development in China 316.1Technical pathways 326.2Production capacity 346.3Availability of feedstocks 356.4Standards development 37chapter 7 Policy support holds the key to SAF development 397.1Government d

20、irectives are critical for breakthroughs 407.2Supportive measures are essential 417.3Multistakeholder collaboration is critical for implementation 427.4Chinese policies will be shaped by a variety of factors 42chapter 8 Policy recommendations 45REFERENCES 48INSTITUTE OF ENERGY,PEKING UNIVERSITY viiL

21、IST OF FIGURESFigure 1-1:World passenger traffic evolution(1945-2022)2Figure 1-2:Passenger traffic evolution in China(2017-2021)4Figure 1-3:GHG emissions from aviation as%of the worlds total 4Figure 2-1:Contributions of different measures to aviation emissions reduction 9Figure 2-2:IATAs SAF targets

22、 10Figure 3-1:Expectations of different SAF pathways between 2020 and 2050 15Figure 4-1:Chinas regulatory system for civil aviation 18Figure 5-1:Chinas SAF supply chain 24Figure 6-1:Opportunities and challenges for different SAF pathways in China 33Figure 6-2:Chinas theoretical SAF production capaci

23、ty by 2025 34Figure 6-3:Estimated aviation fuel consumption in China and theoretical SAF share by 2025 35viii INSTITUTE OF ENERGY,PEKING UNIVERSITYLIST OF TABLESTable 1-1:The COVID-19 impact on world scheduled passenger traffic for year 2020 3Table 1-2:CO2 emissions from aviation in China(2016-2021)

24、5Table 2-1:Main emissions reduction measures by the aviation sector 8Table 3-1:Main SAF producers and production in Europe 13Table 3-2:Main SAF producers and production in the US 14Table 4-1:Chinese policies related to the promotion and use of SAF 19Table 5-1:Chinese airlines flights using SAF 28Tab

25、le 5-2:Number of SAF flights made by global airlines 29Table 6-1:Potential availability of SAF feedstocks in China 36Table 7-1:EUs proposed SAF blending shares 40Table 7-2:Some drivers of Chinese policies on carbon emissions reduction 43INSTITUTE OF ENERGY,PEKING UNIVERSITY ix Photo by Bilal EL-Daou

26、 on PixabayEXECUTIVE SUMMARY In 2019 before the COVID-19 pandemic broke out,the global aviation sector generated 1.8%of global greenhouse gas(GHG)emissions(equivalent to approximately 1.06 billion tons of carbon emissions).Although the global aviation market shrank signifi-cantly in 2020 and 2021 du

27、e to the pandemic,its overall business volume is expected to continue to expand in the coming decades,which means that GHG emissions from the sector will represent an increasing share.Without extra reduction efforts,the international aviation business alone will cumulatively produce 7.0%of global ca

28、rbon emissions during the 2020-2050 period.Aviation is one of the most difficult of sectors to decarbonize,but the global aviation industry has set an ambitious goal to achieve net zero emissions by 2050.Apart from developing new aircraft technology and improving operational and infrastructure ef-fi

29、ciency,developing sustainable aviation fuels(SAF)will also be a crucial measure to achieve net zero.According to a study by the International Air Transport Association,a reduction of 65%in carbon emissions will be achieved through SAF by 2050.INSTITUTE OF ENERGY,PEKING UNIVERSITY xiChina is the worl

30、ds second largest aviation market after the US,whose size will continue to expand in view of its potential demand growth.Carbon emissions from aviation only account for about 1%of Chinas total carbon emissions but given the fact that China has already reached the late stage of industrializa-tion,the

31、 carbon emissions caused by the development scale of traditional heavy industries will gradually reach a plateau.It is estimated that carbon emissions from these industries will go down in the next ten years.By contrast,carbon emissions from the ever-growing aviation industry will be something to be

32、 reckoned with.SAF remains a nascent market in China.On the demand side,airlines in mainland China have only conducted four tests of aircraft flying on SAF since 2011,including commercial test flights.To date,there has been no meaningful demand for SAF in China.On the supply side,only two companies

33、are truly capable of producing SAF but remain at the trial production stage,with a designed annual capacity of approximately 150,000 tons.China still lags behind western countries which have been constantly experimenting with SAF over the past 10-plus years,with a momentum increasingly built up over

34、 the past several years.Globally,the SAF industry as a whole remains highly policy-driven,which is a factor that shapes the external environment of the industry.One determining factor that affects consumption is whether SAF blending is mandated or encouraged.Some western governments have either set

35、targets or introduced plans for the uptake of sustainable transport fuels at national or regional levels,and have introduced specific mandates for SAF blending.These policy signals will directly provide a boost to the development of SAF and other biofuels.Globally,SAF consumption increased from 6,00

36、0 tons in 2016 to 80,000 tons in 2021,but most of such consumption happened in the West.In China,the efforts of many industries,including aviation,to reduce carbon emissions are critical to Chinas goal of peaking carbon emissions and achieving carbon neutrality.According to the 14th Five-Year Plan(F

37、YP)for Green Civil Aviation Development,China aims to increase SAF consumption to 50,000 tons by 2025.This is a positive policy signal,but this amount is not a binding target and there has been no clearly defined pathway towards the goal.Conclusively,participants from across the SAF supply chain in

38、China are still in a stage of capacity building.Market demand for SAF will certainly be stimulated if the Chinese government sends stronger policy signals in the future to incentivize the aviation industry to reduce carbon emissions.More demand will naturally lead to greater supply.Theoreti-cally,wh

39、en Chinas existing and planned production capacity for HVO is retrofitted to produce SAF,its estimated that the countrys total production capacity will reach 2.05 million tons by 2025 when combined with the existing SAF capacity.By then,total SAF supply will account for 4.5%of Chinas total aviation

40、fuel consumption.In China,feedstocks that can be used to produce SAF are wide-spread and available in abundance,which ensures the supply of SAF.However,many uncertainties remain regarding how to strengthen the development of different technical pathways and how to incentivize supply chain collaborat

41、ion and better designs to make SAF products more affordable.Generally,the SAF industry faces both challenges and oppor-tunities in China.If internal and external favorable conditions are fully leveraged to unleash the potential of SAF in reducing carbon emissions,the industry will be a strong boost

42、to Chinas endeavor to reduce carbon emissions from aviation,peak carbon emissions,achieve carbon neutrality and strengthen energy security.xii INSTITUTE OF ENERGY,PEKING UNIVERSITYABBREVIATIONS&GLOSSARY ASTMAmerican Society for Testing MaterialsATAG Air Transport Action GroupCORSIACarbon Offsetting

43、and Reduction Scheme for International AviationHVOHydrogenated Vegetable OilIATA International Air Transport AssociationLCALifecycle AssessmentICAOInternational Civil Aviation OrganizationLCFS Low Carbon Fuel StandardIEA International Energy AgencyISCCInternational Sustainability&Carbon Certificatio

44、nISOInternational Organization for StandardizationREDRenewable Energy DirectiveRFS Renewable Fuel StandardRSB Roundtable on Sustainable BiofuelsRTFCRenewable Transportation Fuel CertificationRPK Revenue Passenger KilometresRTK Revenue Tonne KilometresSAF Sustainable Aviation FuelsUNFCC United Nation

45、s Framework Convention on Climate ChangeWEFWorld Economic ForumGt Gigatonne(1 billion tonnes)Mt Megatonne(1 million tonnes)INSTITUTE OF ENERGY,PEKING UNIVERSITY xiii Photo by Paul H on Unsplash1THE GLOBAL AVIATION INDUSTRY AND CARBON EMISSIONS REDUCTIONSince early 2020,the global aviation industry h

46、as been experiencing a difficult period.The COVID-19 pandemic has resulted in an unprecedented decline in passenger traf-fic.By 2022,the aviation market has started to recover thanks to improved control of the pandemic and relaxed travel restrictions.While struggling to recover,the aviation sector a

47、lso faces the challenge of controlling its own carbon emissions.INSTITUTE OF ENERGY,PEKING UNIVERSITY 21.1 Updates of the aviation industry deve-lopment1.1.1 A slow recovery from the COVID-19 pandemic world-wide According to the International Civil Aviation Organization(ICAO)1,2,3,globally airlines

48、carried 2,300 million passengers in 2021,an overall reduction of 49%from 2019 levels and a modest increase compared with a reduction of 60%in 2020(Figure 1-1).Figure 1-1:World passenger traffic evolution(1945-2022)5001,0001,5002,0002,5003,0003,5004,0005,0004,50001945194619471948194919501951195219531

49、95419551956195719581959196019611962196319641965196619671968196919701971197219731974197519761977197819791980198119821983198419851986198719881989199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013201420152016201720182019202020212022Total passengersNumber of

50、 Passengers Carried(million)Domestic passengersDecline in world total passengersCOVID-19pandemic2022 vs.201921%to 24%International passengers2021 vs.201949%2020 vs.201960%Oil crisisIran-lraq warGulf crisisAsian crisis9/11 terrorist attackSARSFinancial crisisSource:ICAO,June 2022 Photo by PublicDomai

51、nPictures on Pixabay3 INSTITUTE OF ENERGY,PEKING UNIVERSITYCompared with 2019 levels,the world respectively reported a USD 324 billion loss and a USD 372 billion loss of gross passen-ger operating revenues of airlines in 2021 and 2020(Table 1-1).Table 1-1:The COVID-19 impact on world scheduled passe

52、nger traffic for year 2020Compared to 2019 levels 2020 2021 2022(estimated)Seats offered by airlines50%40%15%18%Reduction of passengers(million,%)2,703(down 60%)221（down 49%）921 1,079（down 21%24%）Loss of gross passenger operating revenues of airlines(USD bn)372324133 155Source:ICAO,Effects of Novel

53、Coronavirus on Civil Aviation:Economic Impact Analysis,June 2022Sluggish business performance and declining revenues have generated adverse impacts on the aviation industry in several areas4.It remains uncertain whether airlines will be willing to take further steps to reduce carbon emissions in thi

54、s economic context.Particularly,the substitution of SAF for fossil fuels is also challenging for airlines,as it will certainly increase their energy costs in the short term.1.1.2 Considerable fluctuations in the Chinese market due to the pandemic Due to the pandemic,the number of air passengers plum

55、meted in 2019 compared with 2019 levels and slightly increased in 2021.In 2020,the number of passengers carried by airlines totaled 417.7782 million nationwide,a reduction of 36.7%from 20195.In 2021,the figure rose to 440.5574 million,an increase of 5.5%from 2020(Table 1-2)6.In 2020,Chinese airlines

56、 reported a cargo transport volume of 79.851 billion ton kilometers(tkm),a decrease of 38.3%compared with 2019-Domestic air cargo traffic dropped by 29.2%and international air cargo traffic plummeted by 54.5%.In 2021,Chinas cargo transport volume reached 85.675 billion tkm,up 7.3%from 2020,with an i

57、ncrease of 9.1%in domestic air cargo traffic and a growth of 2.3%in international air cargo traffic.INSTITUTE OF ENERGY,PEKING UNIVERSITY 4Figure 1-2:Passenger traffic evolution in China(2017-2021)Passenger transport volumeGrowth over the previous year5.52 6.12 6.60 4.18 4.41 13.0%10.9%7.9%-36.7%5.5

58、%-40%-30%-20%-10%0%10%20%30%0123456720172018201920202021100 million peopleSource:China Statistical Report on Civil Aviation,CAAC,May 2022 1.2 Progress of the aviation industry in carbon emissions reduction 1.2.1 The aviation industry faces formidable challenges to reduce GHG emissions The aviation i

59、ndustry generated 1.8%of global GHG emissions(which translates into an equivalent of 1.06 billion tons of CO2 according to 2019 data),including 1.1%from international flights and 0.7%from domestic flights(Figure 1-3)7.Figure 1-3:GHG emissions from aviation as%of the worlds totalDomestic flights,0.7%

60、Railway,0.4%Water transport,0.3%Miscellaneous,0.9%International flights,1.1%International sea transport,1.3%Land transport,10.0%Agriculture,forestry and other forms of land utilization,22.0%Industry,24.0%Electric&thermal power,23.0%Construction,5.6%Other energy sources,10.0%Transport，14.7%Source:IPC

61、C,Mitigation of Climate Change 2022,April 2022 5 INSTITUTE OF ENERGY,PEKING UNIVERSITYThe continued growth of the aviation sector in the future is expected to result in more GHG emissions that will represent an expanding share.According to the Report on the Feasibility of a Long-term Aspirational Go

62、al(LTAG)8 for International Civil Aviation CO2 Emissions Reductions that was released by the ICAO Committee on Aviation Environmental Protection in March 2022,cumulative CO2 emissions from international aviationwithout extra effortswill account for 7.0%of the worlds total in the context of limiting

63、global warming to 1.5C.The share can be shrunk to a range between 3.1%and 5.6%if different levels of efforts are made.China is one of the major aviation markets in the world,with an ever-growing business volume that will also lead to more and more carbon emissions(despite a reduction in carbon emiss

64、ions due to a business slump caused by the COVID-19 pandemic,see Table 1-2)9.Like mature markets such as Europe and North America and other emerging markets,China also faces the challenge of reducing carbon emissions while maintaining business growth in the aviation industry.Table 1-2:CO2 emissions

65、from aviation in China(2016-2021)IndicatorUnit2016 2017 2018 2019 2020 2021 Air cargo traffic Billion tkm96.25108.31120.65129.2779.8585.68Aviation fuel10 efficiency10,000 tons/100 million tkm2.932.932.872.853.163.09Aviation fuel consumptionThousand tons28,20031,73034,63036,84025,23026,470CO2 emissio

66、nsThousand tons88,83099,960109,070116,05079,48083,390Note:CO2 emissions are calculated based on the aviation fuel consumption that is worked out based on total air cargo traffic and aviation fuel efficiency data disclosed by annual statistical reports of China on civil aviation development(carbon em

67、issions factor:3.15 kg CO2/kg).1.2.2 The aviation industry has developed aspirational plans to reduce carbon emissions In view of the effects of aviation on global carbon emissions,the aviation industry has developed a voluntary emissions reduction target.The ICAO Assembly at its 41st Session in Oc-

68、tober 2022 adopted a collective long-term global aspirational goal(LTAG)of net-zero carbon emissions by 205011,12.As of July 2022,of the 193 ICAO member states,133 states,representing 98.16%of global RTK,have voluntarily submitted their State Action Plan to ICAO13.A number of airlines have also publ

69、ished their carbon neutrality plans,joined by some aircraft manufacturers and parts suppliers that also followed suit to release their own plans in support of the sectors effort to reduce carbon emissions14.INSTITUTE OF ENERGY,PEKING UNIVERSITY 6In 2021,the IATA 77th Annual General Meeting has appro

70、ved a resolution for the global air transport industry to achieve net-zero carbon emissions by 2050,which is a big stride forward compared with the previous aim of lowering carbon emissions to 50%of 2005 levels by 2050.To be able to serve the needs of the ten billion people expected to fly in 2050,a

71、t least 1.8 billion tons of carbon must be abated in that year.Moreover,the net zero commitment implies that a cumulative total of 21.2 billion tons of carbon will be abated between now and 205015.Photo by Harrison Qi on Unsplash2THE ROLE OF SAF IN AVIATION EMISSIONS REDUCTION INSTITUTE OF ENERGY,PE

72、KING UNIVERSITY 82.1 Main measures adopted by the aviation industry to reduce emissions The aviation sector can reduce carbon emissions through a variety of measures,including developing new aircraft technology to enhance fuel efficiency,using electric and hydrogen-powered aircraft,improving operati

73、onal and infrastructure efficiency,and flying on SAF.For those carbon emissions that cannot be eliminated by itself,the industry can also opt for offsetting plans and carbon capture,utilization,and storage technologies(CCUS)(Table 2-1)16,17,18,19.Table 2-1:Main emissions reduction measures by the av

74、iation sector MeasureExamples of actionMain periods of contributionNew technologies Aircraft and engine manufacturers continue to improve airframe designs and propulsion systems,including optimizing structural designs and using light-weight materials and new combustion chambers;Develop fully electri

75、c,hybrid and hydrogen-powered aircraft,whose commercial or experimental use is envisaged beyond 2030.2010-2050Improved operational and infrastructure efficiency Governments and air navigation service providers(ANSP)remove inefficiencies in air traffic management and infrastructure;Develop more accur

76、ate flying plans and shorten flight time to reduce fuel use;keep flights at optimal heights to maximize fuel efficiency;Airports use low-emission vehicles and install facilities powered by solar and other renewable energy at terminals to further reduce carbon emissions;The adoption of collaborative

77、decision making(A-CDM)to reduce congestion and delay that will result in more fuel consumption.2020-2050Sustainable aviation fuels(SAF)Fuel suppliers provide cost competitive SAF on a large scale;Certify and approve more technical pathways to producing SAF to accelerate SAF development and uptake;Ai

78、rport operators provide needed infrastructure to supply SAF in a more affordable and efficient way.2025-2050Carbon offsetting,capture,utiliza-tion,and storage Airlines invest in offsetting schemes to offset carbon emissions produced by themselves;Airlines introduce voluntary offsetting programs for

79、corporate clients to enable them to offset or reduce carbon emissions associated with their business travels;Airports invest in offsetting schemes like airport carbon accreditation,and build certified green terminals.2025-2040Source:IATA,ATAG and ICAO9 INSTITUTE OF ENERGY,PEKING UNIVERSITY2.2 SAF wi

80、ll be the most important reduc-tion measure Among these measures,developing new aircraft technology and improving operational and infrastructure efficiency will take time and call for continuous improvement.Over the past 10-plus years,fleet fuel efficiency has been steadily on the rise,but optimizat

81、ion actions in conventional technical fields will only produce limited effects in terms of reducing carbon emissions.In the future,the most important measure for reducing carbon emissions is to expand the use of SAF.Figure 2-1:Contributions of different measures to aviation emissions reduction New t

82、echnologiesFuel efciency&Infrastructure improvementsCO2 compensation(CORSIA)An average improvement in fuel efciency of 1.5%p.a.from 2009 to 2020Sustainable alternative fuelsNo actionIATA target2005 2010CO2 emission2020203020402050XABCEmission reduction leverX1234A cap on net aviation CO2 emissions f

83、rom 2019(carbon-neutral growth)A reduction in net aviation emissions of 50%by 2050,relative to 2005 levelsSource:IATA,ATAG20,21,World Economic Forum22 SAF is a liquid fuel that can be used in commercial flights.Compared with the current mainstream aviation fuels(which are mostly petroleum-based),SAF

84、 can reduce CO2 emissions by 80%or even more.They can be produced from various feedstocks,including waste oil and fats,agricultural,forestry and municipal wastes,and non-food crops.They can even be produced via synthesizing hydrogen and captured CO2 from the air.SAF are sustainable in that across th

85、eir lifecycles,carbon emitted by feedstocks during growth and synthesis outweighs carbon emitted from use.Moreover,SAF feedstock does not compete with food crops or water supplies and thus will not contribute to forest degradation or biodiversity loss.To meet sustainability criteria,SAF products are

86、 generally required to pass certification by industry-recognized organizations.In technical and safety terms,SAF products,once certified by relevant standards(like ASTM-D7566),will be deemed as having meet the criteria to blend with the existing petroleum-based aviation fuels without extensive engin

87、e and infrastructure modifications.Currently,the maximum SAF blending limit is 50%.However,it is not technically challenging to realize 100%SAF.For example,Boeing once tested a flight using 100%SAF in 2018.2.3 It is critical to dramatically increase SAF production and consumptionTo unlock the potent

88、ial of SAF,it is essential that SAF consumption be dramatically increased from 63 million liters INSTITUTE OF ENERGY,PEKING UNIVERSITY 10(approximately 50 thousand tons)in 2020 and 100 million liters(approximately 80 thousand tons)in 2021 to nearly 7.9 billion liters(approximately 6.3 million tons)i

89、n 2025 and further to 449 billion liters(approximately 358.3 million tons)in 205023(Figure 2-2).Figure 2-2:IATAs SAF targets0.056.318.3572.621822763582020202520302035204020452050%of total fuel demand0.03%2%5.2%17%39%54%65%SAF demand(Million tons)In 2050,SAF will accountfor 65%of aviations carbon mit

90、igation.SAF consumption will increase from 50,000 tons in 2020 to 6.3 million tons in 2025 and further to 358 million tons in 2050.Source:IATA,2021This pace of growth is challenging for the aviation sector,but it is achievable.The past five years have already witnessed some progress in the utilizati

91、on of SAF in the sector.Today,SAF is already available at a number of airports,including Oslo Airport in Norway,Stockholm Airport in Sweden,and Los Angeles International Airport and Seattle Airport in the US24,25.3TECHNICAL PATHWAYS TO PRODUCING SAF As of October 2021,a total of nine technical pathw

92、ays to SAF production have been approved by the ASTM International,including seven pathways approved by ASTM D7566 and two pathways approved by ASTM D165526,27,28.This report will mainly examine three of the nine pathways,including the Hydroprocessed Esters and Fatty Acids(HEFA)process,the Gasificat

93、ion/Fischer-Tropsch(G+FT)process and the Alcohol to Jet(AtJ)process,as well as an unapproved pathway,the Power to Liquid(PtL)process.These four technical pathways are widely considered by the aviation industry as most promising and are being closely watched by major fuel suppliers worldwide.INSTITUT

94、E OF ENERGY,PEKING UNIVERSITY 123.1 The status of production Currently,Europe and North America remain the major con-sumers and producers of SAF.The HEFA pathway dominates the existing and new production capacities disclosed by major European producers,despite the fact that G+FT,AtJ and PtL are also

95、 adopted in some new production capacities.In the US,most of SAF producers opt for the AtJ pathway.In Europe,at least eight manufacturing facilities have been built to produce SAF,in addition to more than 20 new or expansion projects that are being planned(including five demonstration projects).By 2

96、025,SAF production will likely reach 7.2 million tons under HEFA,700 thousand tons under G+FT,400 thousand tons under AtJ,and 200 thousand tons under PtL(Table 3-1).Theoretically,if stimulated by strong external policy incentives,these capacities can produce up to three million tons of SAF a year.Wi

97、thout clear policy signals,however,these capacities may be mostly utilized to produce biofuels used for road transport29.Photo by Honglin Shaw on Unsplash13 INSTITUTE OF ENERGY,PEKING UNIVERSITYTable 3-1:Main SAF producers and production in Europe Supplier CountrySite Tech.Start/Expansion Total fuel

98、 capacity(Mt./yr.)Existing facilities/Expan-sionsNesteFinlandPorvooHEFA0.4NesteNetherlandsRotterdamHEFA1.3UPMFinlandLappeenrantaHEFA0.1Total EnergiesFranceLa MedeHEFA0.5CepsaSpainSan RoqueHEFA0.1Repsol*SpainCartagenaHEFA20230.2ENI*ItalyVeniceHEFA20240.4Preem*SwedenGothenburgHEFA20251.0New projectsEn

99、erkem*NetherlandsRotterdamG+FT2021 0.1 ColabitoilSwedenNorssundetHEFA20210.5ENIItalyGelaHEFA20210.5ST1SwedenGothenburgHEFA20220.2Kaidi*FinlandKemiG+FT20220.1SkyNRGNetherlandsDSL01HEFA20230.1Sunfire*NorwayNordic BluePtL20230.1Caphenia*GermanyDresdenPtL20232,50022 2011-07/2022430,00045 Source:IATA,Avi

100、ation Benefits Beyond BordersTo date,large airlines in Chinese mainland have not specified any plan,goal or pathway regarding SAF use.Local airlines are expected to in a stage of capacity building before relevant policies or specific requirements are introduced by the Chinese government.Hong Kong-ba

101、sed carrier Cathay Pacific is a more active user of SAF.Since 2016 when Cathay Pacific took delivery,using SAF,of a new plane from Toulouse,where Airbus is headquartered,the company has cumulatively consumed more than 200 tons of SAF.It has also committedto purchasing 1.1 million tons of SAF over th

102、e next 10 years,to using SAF for 2%of its total fuel con-sumption by 2025 and further to 10%by 2030,and to reaching net-zero carbon emissions by 2050.In April 2022,Cathay Pacific launched the Corporate Sustainable Aviation Fuel Program to express its demand for SAF to relevant suppliers,to which CNC

103、P and Shell will supply fuels63.INSTITUTE OF ENERGY,PEKING UNIVERSITY 30 Photo by 宅-KEN on Pixabay6OUTLOOK FOR SAF DEVELOPMENT IN CHINA Generally,the SAF industry is still in its infancy in China and has a bright future ahead,but currently the industry faces many challenges.At the national level,Chi

104、na lacks systematic top-down designs and clear policy signals,as a result of which key market players remain staying in the stage of preparation with no clear development plans.There also exist barriers and bottlenecks in terms of production capacity,technological readiness,feedstock supply and cost

105、.However,Chinas SAF industry also enjoys cer-tain opportunities and advantages.If making full use of internal and external favorable conditions to unleash the potential of SAF in reducing carbon emissions,the industry will provide a boost to the countrys efforts to reduce carbon emissions from aviat

106、ion,peak carbon emissions,achieve carbon neutrality and strengthen energy security.INSTITUTE OF ENERGY,PEKING UNIVERSITY 326.1 Technical pathways Currently,the industry is mainly interested in four technical pathways to producing SAF,including Hydroprocessed Esters and Fatty Acids(HEFA),Gasification

107、/Fischer-Tropsch(G+FT),Alcohol to Jet(AtJ)and Power to Liquid(PtL)(Table 6-1).HEFA is the only pathway that has been adopted by China in its SAF and HVO production and demonstration projects.Backed by more mature technology and process,the pathway is followed by both ECO and Zhenhai Refining in thei

108、r SAF projects,so do Haixin and Zhongdiyou,which also adopt HEFA in their current HVO projects(LYZY also plans to use HEFA processing in its HVO project that is soon to be operational).Western countries have already launched demonstration pro-jects of G+FT and AtJ,but China has not started to explor

109、e the two areas.Some demonstration projects producing ethanol fuel and related chemicals adopt the two pathways.For example,some companies in northeast China are producing ethanol from straws and stalks.Shougang LanzaTech is also converting industrial waste gases into ethanol in Hebei and Ningxia.Ho

110、wever,no project in China is capable of directly converting alcohols into fuels at an industrial scale.As in western countries,the PtL pathway remains a“concept”in China,but there have arisen demonstration projects of producing methanol from green hydrogen.In 2020,a technical team from the Chinese A

111、cademy of Sciences(CAS)successfully completed trial production in a demonstration project in Lan-zhou,Gansu that can produce methanol from green hydrogen at a scale of one thousand tons a year.Presently,the team is working on an industrialization project with a capacity of 100 thousand tons64.Photo

112、by DeltaMike on Pixabay33 INSTITUTE OF ENERGY,PEKING UNIVERSITYFigure 6-1:Opportunities and challenges for different SAF pathways in ChinaHEFAAtJ1 G+FTPtLOpportunity descriptionSafe,proven,and scalable technologyPotential in the mid-term,however significant techno-eco-nomical uncertaintyProof of con

113、cept 2025+,primarily where cheap high-volume electricity is availableTechnology maturityMatureCommercial pilotIn developmentFeedstock Waste and residue lipids,purpose-ly grown oil energy plant2 Transportable and with existing supply chains Potential to cover 5%-10%of total jet fuel demand Agricultur

114、al and forestry residues,municipal solid waste4,purposely grown cellulosic energy crops5 High availability of cheap feedstock,but fragmented collection CO2 and green electricity Unlimited potential via direct air capture Point source capture as bridging technology%LCA GHG reduction vs.fossil jet73%-

115、84%385%-94%699%7Opportunities in the Chinese market Rich in raw materials.With good industrial foundation.Rich in raw materials Development basis of renewable energy industry.Have better exploration.Challenges in the Chinese marketThe distribution of raw materials is scattered and the cost of collec

116、tion is high.Lack of technical reserve and R&D foundationLack of technical reserve and high cost.Note:1.Ethanol route;2.Oilseed bearing trees on low-ILUC degraded land or as rotational oil cover crops;3.Excluding all edible oil crops;4.Mainly used for gas./FT;5.As rotational cover crops;6.Excluding

117、all edible sugars;7.Up to 100%with a fully decarbonized supply chainSource:World Economic Forum,Clean Skies for Tomorrow:Sustainable Aviation Fuels as a Pathway to Net-Zero Aviation,2021;research by Chinese experts.Under the HEFA pathway adopted in China,companies universally opt for waste oil inste

118、ad of non-food crops,which is a more sustainable practice that benefits carbon emissions reduction.Moreover,China is industrially better positioned in this field,which is foundational for the expansion of SAF production capacity in the future.In terms of technological readiness,there remains much to

119、 be done for Chinese companies when it comes to G+FT and AtJ processing.Sino-foreign collaboration in R&D may help accelerate the adoption of these two pathways in China,where they will have enormous potential in view of the widespread availability of feedstocks for the two pathways.INSTITUTE OF ENE

120、RGY,PEKING UNIVERSITY 34The world holds high expectations of PtL as a medium-and long-term technical pathway,so does China,which hosts an abundance of resources for solar and wind power generation that is backed by explicit policy support.This will help drive the development of green hydrogen,which

121、in turn will help give rise to PtL demonstration projects around 2025.6.2 Production capacity Chinas current SAF production capacity(under the HEFA pathway)amounts to 150 thousand tons a year.For now,not explicit plans have been announced to initiate new production projects65.Because of a high posit

122、ive correlation between SAF production capacity and user demand,Chinas SAF production capacity may be expanded in response to growing demand.In view of more mature processes for the HEFA pathway,SAF producers will find it more practical and efficient if they want to build new SAF production faciliti

123、es or repurpose their existing HVO capacities using the pathway.The HEFA pathways requires a hydrogenation facility(and a hydrogen production facility if there is no supply of the substance),which is the most time-and cost-consuming component of production expansion.Practically,in China it usually t

124、akes two to three years to build a new SAF production facility with an annual capacity of 100 thousand tons.The time can be shortened to months or approximately one year if an existing HVO facility or a refining facility with hydrogenation and hydrogen production systems is transformed.However,it is

125、 less practical and less cost efficient to repurpose first-generation biodiesel production capacity for SAF produc-tion due to the formers significant difference from HVO and SAF production in terms of manufacturing process and facility.Before 2025,if we assume that there is no additional SAF or HVO

126、 production capacity and China expands or repurposes currently operational SAF/HVO capacities and those to be completed before 2025 to maximize production,total SAF production will reach an estimated 2.05 million tons in 202566(Figure 6-2).Figure 6-2:Chinas theoretical SAF production capacity by 202

127、52.351.92.050.1500.51.0RepurposedMillion tons/year1.52.02.5HVO potential capacityExisting SAF capacitySAFHVO capacity repurposed for SAF productionNote:1)It is assumed that no new capacities will be added to the already announced SAF or HVO capacities before 2025;2)another assumption is that both cu

128、rrently operational and SAF/HVO production capacities to be completed by 2025 will be either expanded or repurposed to maximize SAF production and that 80%of HVO production capacities will be repurposed for SAF production.35 INSTITUTE OF ENERGY,PEKING UNIVERSITYOn the demand side,China consumed 36.8

129、4 million tons of aviation fuels in 2019.Due to declines in traffic caused by the COVID-19 pandemic,aviation fuel consumption dropped to 25.23 million tons in 2020 and recovered slightly to 26.47 million tons in 2021.If we assume that the business volume of Chinas aviation sector recovers to pre-COV

130、ID levels in 2024 and continues to increase slightly in 2025,Chinas aviation fuel consumption will reach 41.2 million tons.If the above-men-tioned 2.05 million-ton-capacity can supply 1.85 million tons of SAF to the market,SAF will account for 4.5%of Chinas total aviation fuel consumption(Figure 6-3

131、).Figure 6-3:Estimated aviation fuel consumption in China and theoretical SAF share by 2025 05101520Millon tons25303540452019202020212022202320242025Potential share of SAF:4.5%Note:It is assumed that China will increase its total SAF production capacity to 2.05 million tons and is able to supply 1.8

132、5 million tons of SAF by 2025.6.3 Availability of feedstocks Feedstocks that can be used to produce SAF are widespread in abundance in China,including waste cooking oil,agricultural and forestry wastes,municipal organic solid wastes,industrial fumes,energy crops,and green hydrogen67.Waste cooking oi

133、l(WCO,commonly known as“gutter oil”)is the major source of feedstock for producing biodiesel in China and is expected to be the major feedstock for SAF production at least in the next decade.WCO supply is sparsely distributed in China and the recyclable amount is estimated at 3.4 million tons(2019)6

134、8.Most of it is processed domestically to produce biodiesel or exported to Europe,with a minority of it reused to produce soaps,plasticizers,and pesticide emulsions.When there is more market demand for SAF,WCO can also be used to produce SAF.Agricultural wastes generally include straws and stalks as

135、 well as leftovers from the primary processing of agricultural products,such as rice husks,corn cobs,peanut shells,and sugarcane bagasse.They are mostly abundantly available in major agricultural producing areas,including northeast,north and the lower and middle reaches of the Yangtze River.China ca

136、n provide a total of 207 million tons of agricultural wastes for energy production,including 145 million tons of straws and stalks and 62 million tons of leftovers from the primary processing of agricultural products69.Forestry wastes include leftovers from tree felling,wood INSTITUTE OF ENERGY,PEKI

137、NG UNIVERSITY 36processing,clearing,and trimming.These wastes are mostly found in areas like northeast and southwest.An estimated 195 million tons are available for energy production70.Of municipal solid wastes(MSW),organic wastes represent 20%to 35%,which if well processed,can also be used to produ

138、ce SAF.Nationwide,a total of 235 million tons of MSW were removed(in 2020)71.If 10%of them can be recycled for energy production,that will translate into 23.5 million tons of feedstock.China also generates considerable amounts of industrial waste gas that can be utilized to produce ethanol to the tu

139、ne of five million or even ten million tons a year.Then ethanol can be used to make SAF.China possesses sizeable swathes of marginal land72(like saline and alkaline land),which can be used to grow energy crops,but in view of Chinas limited land reserves and water supply,high uncertainty exists with

140、regards to the use of energy crops for production of fuels like SAF.For now,this report will not factor in the available amount of energy crops.The available amounts of above-mentioned feedstocks are listed in the table below.Although WCO is the most mature feedstock for SAF production,its availabil

141、ity is limited.The supply of agricultural and forestry wastes is bountiful with enormous potential,but in the future China will need to coor-dinate their use for multiple purposes(such as return-to-field,heat supply,power generation and liquid fuel development).Table 6-1:Potential availability of SA

142、F feedstocks in China FeedstockAvailability(million tons/year)SAF output ratio SAF production(million tons/year)Waste cooking oil3.440%（HEFA）1.36Agricultural waste20710%（AtJ/G+FT）20.7Forestry waste19510%（AtJ/G+FT）19.5Municipal organic solid waste23.510%（AtJ/G+FT）2.35Industrial waste gas-based ethano

143、l550%（AtJ/G+FT）2.5Total433.9-46.41Note:1)The use of different feedstocks and processes for SAF production will also result in the production of different percentages of biodiesel,gasoline,and naphtha.Output ratios can be adjusted to maximize SAF production,but this will also result in more low-value

144、 byproducts like naphtha.Therefore,given current technological readiness and cost efficiency,the output ratios listed in the table are overall SAF output ratios under optimal conditions.With technological progress,these ratios may be further improved;2)Output ratios for using agricultural and forest

145、ry wastes or municipal solid wastes to produce SAF fluctuate between 10%and 15%.A standard 10%ratio is used in the table;3)The output ratio for using industrial waste gas to make SAF is set at 50%.4)The estimation on feedstocks for PtL pathway is not listed above,since theoretically potential raw ma

146、terials for PtL,namely CO2 and renewable electricity,are endless.Source:Data on feedstock availability comes from Tian Yishui and other experts as well as from the Ministry of Housing and Urban-Rural Development;output ratios come from McKinsey Global Energy Practice,ICCT,International Renewable Ene

147、rgy Agency(IRENA)and Chinese industry experts.37 INSTITUTE OF ENERGY,PEKING UNIVERSITY6.4 Standards development As a sustainable fuel,SAF must meet process and performance criteria required for aviation fuel safety and quality and satisfy sustainability standards.Currently,countries mainly certify t

148、he airworthiness of SAF produced under approved processes via standards such as GB 6537,ASTM D7566 and DEF STAN 91-091.SAF sustainability is certified against standards such as RSB and ISCC.Western countries are leading the world in standards development in view of their status as major producers an

149、d consumers of biofuels.Over the past 10-plus years,China only used a very small amount of SAF,mostly for test flights by some airlines and for only two commercial passenger flights.During this stage,SAF use mainly followed conventional aviation fuel standards for transportation,storage,and into-pla

150、ne service.Today,China has preliminarily established a set of standards on aviation biofuel process and performance and is currently conducting research on sustainability standards.Most of biofuels(mainly biodiesel)produced in China are sold to Europe.For SAF to be produced in the future,western sta

151、ndards and certification systems will apply if they still target the European market.Airlines and potential SAF producers have high expectations about Chinese authorities move to develop and improve the countrys SAF standards and their coordination and alignment with foreign counterparts.Considering

152、 the fact that China has already established its own standards system on aviation biofuels,which is highly consistent with international standards like ASTM,issues associated with standards will not become obstacles to SAF development.In the future,both foreign and domestic standards will be constan

153、tly fleshed out and enhanced in response to expanding SAF production and use.INSTITUTE OF ENERGY,PEKING UNIVERSITY 38 Photo by 穿著拖鞋一路小跑 on Pixabay7POLICY SUPPORT HOLDS THE KEY TO SAF DEVELOPMENTINSTITUTE OF ENERGY,PEKING UNIVERSITY 407.1 Government directives are critical for breakthroughs Currently

154、,the SAF industry remains highly policy-driven and therefore policy targets constitute an important component of the external environment for the industrys development.The most crucial factor is whether the government will establish mandatory or recommended SAF blending shares.In European and US mar

155、kets,governments have introduced goals for the use of sustainable transport fuels and specific blending requirements at both national and regional levels.Directive(EU)2018/2001 of the European Parliament(RED II)and of the Council establishes a binding Union target of raising the share of renewable e

156、nergy to at least 32%of EUs energy consumption,including a sub-target of requiring fuel suppliers to supply a minimum of 14%(with advanced biofuels accounting for 3.5%)of the energy consumption in road and rail transport by 203073,74.As for the aviation sector,the ReFuel EU Aviation Initiative,part

157、of EUs“Fit for 55”package,proposes to gradually phase out free emission allowances for the aviation sector and align the proposal with the global Carbon Offsetting and Reduction Scheme for International Aviation(CORSIA).For the first time,the European Council also agreed to include maritime shipping

158、 emissions within the scope of the EU Emis-sions Trading System(ETS).At the same time,aviation fuel suppliers are required to blend more and more SAF in its fuels supplied to European aircraft75.To encourage the development of PtL processing,EU also plans to set a quantitative target for the share o

159、f SAF produced under the pathway.Currently,these proposals for regulations are pending approval.Table 7-1:EUs proposed SAF blending sharesSAF blending sharePtL as%Year2%-From 20255%At least 0.7%From 203020%At least 5%From 203532%At least 8%From 204038%At least 11%By 204563%At least 28%By 2050Source:

160、compiled based on information from EU websites.41 INSTITUTE OF ENERGY,PEKING UNIVERSITYSimilarly,the Energy Independence and Security Act of the US(EISA)76,77 has established annual targets for all kinds of biofuels and authorizes the Environmental Protection Agency(EPA)to establish and adjust annua

161、l biofuel quotas depending on market supply and demand.EPA requires all obligated biofuel blenders(including refineries)to sell prescribed quotas of biofuels each year or buy corresponding quotas from the trading market.Driven by these policy requirements,all participants across the supply chain of

162、SAF in western countries are actively pushing for SAF development,which has in turn resulted in its steady growth.Global annual SAF consumption soared from eight million liters(approximately 6,400 tons)in 2016 to 100 million liters(approximately 80 thousand tons)in 202178,but most of it happened in

163、Europe and North America.In China,the 14th FYP for Green Civil Aviation Development proposes to increase annual SAF consumption to 50 thousand tons(approximately 63 million liters)by 2025.This is a positive policy signal,but the target of 50 thousand tons is not a binding one and the pathway towards

164、 the target has yet to be clarified.Generally,all players across the supply chain are still in a stage of capacity building.Airlines,aviation fuel producers,and distributors in China are predominantly state-owned enterprises.Under this system.the absence of top-down designs at the central government

165、 level will create a high level of uncertainty for the industrys development.Participants from all parts of the supply chain will remain hesitant,waiting for explicit policy signals from the government,which will result in the lack of coordinated and collective actions among them.First,in terms of m

166、arket demand,without a mandatory SAF target,airlines will not take it as an urgent priority to promote SAF use and therefore have not introduced any further plans in this field except for the few flight tests between 2011 and 2017.Despite the global emissions reduction target set by CORSIA for the a

167、viation sector,airlines are still waiting for the progress in negotiations at the national level,without any action plans.Second,in terms of investment,large fuel suppliers such as Sinopec and CNPC will find it difficult to establish medium-and long-term strategies for SAF production due to the tiny

168、 SAF market and the lack of clear policy signals.The SAF facility of Zhenhai Refining is still a demonstration project by nature.As for small and medium-sized suppliers,they will also find it difficult to make investment decisions when SAF involves hefty investments but without policy clarity and ma

169、rket demand.7.2 Supportive measures are essential The lack of systematic top-down designs for SAF in China has also contributed to the absence of relevant policy incentives and self-driven market mechanisms that can stimulate the de-velopment of the SAF industry.In the biodiesel industry that is clo

170、sely related to SAF,China exempts biodiesel that conforms to national standards from consumption taxes and grants a refund of 70%of value-added tax.When such preferential tax treatment is piloted in some provinces and cities,some local governments have also introduced corresponding fiscal and price

171、policies79 that are encouraging to biodiesel producers.Another example is the electric vehicle sector under the mobil-ity industry,which has also enjoyed considerable government support throughout the past decade of its infancy.By contrast,no targeted supportive measures have been insti-tuted in SAF

172、 industry.Due to the nascency of the SAF market and the disconnect between SAF standards and certification systems and relevant policies,at best SAF products can only be characterized as a sub-category of the biodiesel category to seek fiscal and tax support before new policies are implement-ed.High

173、 cost is a weakness of SAF when compared with conven-tional aviation fuels and it is also a significant impediment to its widespread adoption.Due to the adverse effects of the COVID-19 pandemic,airlines are increasingly conservative about internal cost control and external investment.Using SAF that

174、is multiple times more expensive than conventual fuels will be an extra financial burden for airlines.SAF will stand a chance of becoming more cost competitive if the government,SAF users and suppliers,aircraft manufactur-ers and airports make collective efforts and design incentive mechanisms to pr

175、omote technological progress and wider application.INSTITUTE OF ENERGY,PEKING UNIVERSITY 42In this regard,the US has made encouraging attempts.In September 2021,the Biden administration released a cross-departmental action plan,the Sustainable Aviation Fuel Grand Challenge80,81.It is a commitment ma

176、de by the Department of Energy,the Department of Transportation,the Department of Energy and the Federal Aviation Administration in collaboration with the SAF industry to invest up to USD 4.3 billion to produce SAF on a commercial scale,increase the production of SAF to three billion gallons(approxi

177、mately 9.06 million tons)per year by 2030,and supply sufficient SAF to meet 100%of aviation fuel demand(approximately 35 billion gallons per year)by 2050.Relevant government departments and major industry participants have all made commitments or developed plans.7.3 Multistakeholder collaboration is

178、 criti-cal for implementation SAF use involves all parts of the supply chain.In markets with explicit policy signals,multistakeholder collaboration is a necessary safeguard of implementation.In markets without clear policies(like China),such collaboration is even more critical when the SAF market re

179、mains in its early stage,as this will help solve the question“which came first,the chicken or the egg?”Multistakeholder cooperation can not only help early movers become resilient against risks and accumulate valuable experience but will also help inform policy making and improvement.Moreover,succes

180、sful experience will also enhance policy makers confidence in promoting SAF.In western countries,the SAF market is usually activated by the key stakeholder,like airports,from the supply chain in collaboration with airlines,SAF producers and aviation service buyers.This practice has produced encourag

181、ing results and offers illuminating insights for the Chinese market.The ap-pendix of this report offers cases of western countries making collective efforts across the supply chain to promote SAF use.7.4 Chinese policies will be shaped by a variety of factors The Chinese government plans to scale up

182、 SAF consumption to 50 thousand tons by 2025,but this is not a mandatory target and pales in comparison with conventional aviation fuel consumption that amounts to 30 to 40 million tons per year(2018-2019).It can hardly bolster the confidence of airlines and producers in making more SAF investments.

183、As in other countries,whether the Chinese government will institute stricter policies or set more ambitious goals about SAF not only depends on the progress of the global aviation industry in reducing carbon emissions,but also on what potential contributions SAF can make to Chinas climate change res

184、ponse,environmental protection,energy security,and industrial development.When we examine current and historical policies on carbon emissions control,we can see that these factors are often potential drivers of policy making in a particular sector.Therefore,whether China will provide further policy

185、clarity on SAF partly depends on how much SAF can contribute in relevant areas.43 INSTITUTE OF ENERGY,PEKING UNIVERSITYTable 7-2:Some drivers of Chinese policies on carbon emissions reduction Sector Selected polies Reduce carbon emi-ssionsReduce conven-tional pollu-tantsStreng-then energy securityEn

186、hance indus-trial competi-tivenessEnergy-intensive sectors Guiding Opinions on Accelerating the Establishment and Improve-ment of a Green,Low-carbon,and Circular Economic System 14th Five-Year Comprehensive Work Plan for Energy Conservation and Emissions Reduction Implementation Guide for the Transf

187、ormation and Upgrading of Energy-Intensive Sectors to Save Energy and Reduce Carbon Emissions(2022)VVRenewable energy Guiding Opinions on Accelerating the Establishment and Improve-ment of a Green,Low-carbon,and Circular Economic System Strategic Action Plan for Energy Development(2014-2020)14th FYP

188、 for Renewable Energy Development 14th Comprehensive Work Plan for Energy Conservation and Emissions ReductionVVVVElectric vehicles Mid-and Long-term Development Plan for the Automobile Industry Development Plan for Energy Conservation and New Energy Vehicles(2012-2020)Development Plan for the New E

189、nergy Vehicles Industry(2021-2035)The Circular of the Ministry of Finance,the Ministry of Industry and Information Technology,the Ministry of Science and Tech-nology and the National Development and Reform Commission Concerning the Promotion of New Energy Vehicles Through the Further Improvement of

190、Fiscal Subsidies(Caijian 2020 No.593)Green Travel Action Plan VVVVDispersed coal control Action Plan for Air Pollution Prevention and Control Clean Winter Heating Plan in North China(2017-2021)Three-Year Action Plan for Winning the Blue Sky War Strategic Plan for Rural Rejuvenation(2018-2022)VVINSTI

191、TUTE OF ENERGY,PEKING UNIVERSITY 44 Photo by Honglin Shaw on Unsplash8POLICY RECOMMENDATIONSINSTITUTE OF ENERGY,PEKING UNIVERSITY 468.1 Further clarify policy direction The utilization and promotion of SAF are associated with the overall emissions reduction of the aviation sector as well as with the

192、 energy transition and technological change of the supply chain.Currently,ICAO,IATA,aircraft and engine manufacturers,airlines,conventional and new oil companies,and western governments are all actively promoting the uptake of SAF with an aim to become standard setters and leaders in such areas as i

193、ndustry,technology,and trade.Carbon emissions from aviation will grow in China in anticipa-tion of the sectors fast growth.Aviation fuel is a major cause of carbon emissions as well as a breakthrough in emissions reduction.If China moves early to industrialize SAF production and releases explicit po

194、licy signals,it will not only help complete its SAF supply chain and accelerate the post-COVID green recovery of its aviation industry,but will also help itself gain more initiative when participating in the development and improvement of rules on carbon emissions reduction by the global aviation se

195、ctor.China has set a short-term goal of cumulatively consuming 50 thousand tons of SAF by 2025,but the country has not developed any action plan,remains vague about its medium-and long-term policy direction,and has not provided enough policy support.The government is advised to develop explicit plan

196、s and favorable policies for the industrys development and to leverage fiscal funding to channel private-sector capital into SAF-related industries.The government can also make it clear to include SAF within carbon emissions trading and incorpo-rate emissions reduction into the measurement of airlin

197、es carbon emissions intensity.Regulatory agencies,including civil aviation,energy,industry&commerce,and quality inspection,can work in collaboration and coordination with each other to strengthen regulation,track the industry on an ongoing basis,regularly analyze the progress in SAF production and p

198、romotion,and introduce measures and solutions based on critical issues that have been identified.8.2 Establish a cross-ministerial working group and develop action plans To strengthen organization and leadership,China is advised to establish a cross-ministerial coordination mechanism to solve major

199、issues arising from SAF development and develop sup-porting policies to advance progress in a coordinated manner.It is recommended that the formulation of the development and action plans for the SAF industry be dominated by the government and involve industry associations and platform organizations

200、 as the organizer,as well as other stakeholders from across the SAF supply chain,including airlines,refineries,aviation fuel suppliers,aircraft manufacturers,airports,and research institutes.China may also adopt these measures,such ascreating and improving monitoring,reporting,audit,and management s

201、ystems for GHG emissions from aviation and SAF-related sectors;creating needed certification systems;and actively involving itself in the development and implementation of international rules within the framework of CORSIA.8.3 Strengthen the basic information assessment and cost effectiveness analys

202、is of feedstock China is also advised to strengthen collection and update of basic information on various feedstocks used under different technical pathways to find out their distribution and avail-ability,so as to facilitate better allocation of resources for the industry.Cost effectiveness analysi

203、s should also be made based on the levels of difficulty of collecting different feedstocks,technological readiness levels and cost curves to promote the development of financial support policies by the government.8.4 Guide collective actions across the supply chain Communication and exchanges betwee

204、n participants from across the supply chain should be facilitated to enable coor-dination between fuel users and suppliers.The government is also advised to support collaborative innovation in SAF among various kinds of entities,and encourage oil refineries,47 INSTITUTE OF ENERGY,PEKING UNIVERSITYai

205、r transport companies and aviation manufacturers to make joint investments in SAF projects that reward investors with returns in a market-based manner,so as to promote SAF use on a regular and industrial scale.8.5 Support technological innovation On this front,China can adopt the following measuress

206、upporting the establishment of a SAF technology R&D system;promoting the diversified development of different SAF pathways,such as oil-based,cellulose-based,and green hydrogen-based technologies;guiding companies and research institutes to accelerate technological innovation and launch industrial-sc

207、ale demonstration projects;and supporting SAF producers with proprietary intellectual property rights to expand their production capacity and global competitiveness.China has a solid industrial foundation in the domain of oil-based aviation fuels,but the presence of Chinese companies in the fields o

208、f cellulose-based and green hydrogen-based aviation fuels is minimal.The country needs to expand R&D spending,industry-wide partnership,and international cooperation in these fields.8.6 Actively promote the pilot use of SAF Based on its industrial strategy,China can pilot the use of SAF produced fro

209、m different feedstocks and under different technical pathways,taking account of the characteristics of into-plane service.Building on its successful pilot experience and in view of the availability of feedstocks in different places,SAF production infrastructure and regional levels of air transport d

210、evelopment,the country can broaden its support to SAF on the demand side by making SAF available at more airports.For air transport companies that voluntarily use SAF with a relatively high share,a holistic approach may be adopted to management policies on fleet,investment,pricing,credit,and tenderi

211、ng.A market-driven approach should also be upheld to encourage healthy competition,to lower SAF costs,to produce replicable and scalable practices and ultimately to create a virtuous cycle for SAF development across the entire supply chain.INSTITUTE OF ENERGY,PEKING UNIVERSITY 48REFERENCES1 ICAO.Eff

212、ects of Novel Coronavirus(COVID-19)on Civil Aviation:Economic Impact Analysis EB/OL.(2022-06-10).https:/www.icao.int/sustainability/Documents/COVID-19/ICAO_Coronavirus_Econ_Impact.pdf.2 ICAO.Economic Impacts of COVID-19 on Civil Aviation EB/OL.(2022-01-17).https:/www.icao.int/sustainability/Pages/Ec

213、onomic-Impacts-of-COVID-19.aspx.3 ICAO.2021 global air passenger totals show improvement from 2020,but still only half pre-pandemic levels EB/OL.(2022-01-17).https:/www.icao.int/Newsroom/Pages/2021-global-air-passenger-totals-show-improvement.aspx.4 ICAO.Economics Impacts of COVID-19 on Civil Aviati

214、on EB/OL.2022-03-21.https:/www.icao.int/sustainability/Pages/Economic-Impacts-of-COVID-19.aspx 5 China Statistical Report on Civil Aviation 2020,CAAC,June 10,2021 10/06/2022.http:/ data shared in this section regarding the Chinese market comes from this statistical report if not specified otherwise.

215、6 China Statistical Report on Civil Aviation 2020,CAAC,May 18,2022 10/06/2022.http:/ IPCC.Climate Change 2022:Mitigation of Climate Change(full report,final draft version)R/OL.2022-04-04.https:/www.ipcc.ch/report/ar6/wg3/.Note:As for the share of CO2 emissions from aviation,results vary from organiz

216、ation to organization due to different measures and methods used.For example,IEA says that CO2 emissions from aviation in 2019 were approximately one billion tons,accounting for 2.8%of global emissions from fossil fuel energy consumption（https:/www.iea.org/reports/tracking-aviation-2020）.According t

217、o Air Transport Action Group(ATAG),CO2 emissions from aviation represent 2.1%of man-made CO2 emissions(https:/www.atag.org/facts-figures).Based on its data collected from different sources,Our World in Data says that GHG emissions from aviation accounted for 1.9%of global GHG emissions in 2016 and 2

218、.1%in 2018(https:/ourworldindata.org/CO2-emis-sions-from-aviation).D.S.Lee and other co-authors believe that aviation contributes 3%to 4%if the impacts of both CO2 and non-CO2 GHG emissions on global warming are factored in(https:/ report uses IPCC data in view of this overall data situation.8 ICAO,

219、The Report on the Feasibility of a Long-term Aspirational Goal for International Civil Aviation CO2 Emissions Reductions,ICAO-LTAG report Appendix R3:Results in the Climate Science Context R/OL.2022-03-28.https:/www.icao.int/environmental-protection/LTAG/Pages/LTAGreport.aspx.9 As for carbon emissio

220、ns from various sectors in China,foreign and domestic research institutes have made estimates using different methods and sources of data,so results vary sometimes.Estimates made in this report are based on data released by CAAC.10 The term of“aviation oil”is also used in the sector,but“aviation fue

221、l”is mainly used in this report.11 ICAO.Long term global aspirational goal(LTAG)for international aviation EB/OL.2022.10.11.https:/www.icao.int/environmental-protection/Pages/LTAG.aspx 12 ICAO.State adopt net-zero 2050 global aspirational goal for international flight operations.2022.10.11.https:/ww

222、w.icao.int/Newsroom/Pages/States-adopts-netzero-2050-aspirational-goal-for-international-flight-operations.aspx 13 ICAO.State Action Plans and Assistance EB/OL.02/08/2022.https:/www.icao.int/environmental-protection/Pages/ClimateChange_ActionPlan.aspx14 ICAO.Aviation Net Zero EB/OL.15/04/2022.https:

223、/www.icao.int/environmental-protection/SAC/Lists/Aviation%20Net%20Zero/ProjectViewNZ.aspx#InplviewHashfaf64a02-c0cb-4e19-a273-65956a587e8c=15 IATA.Net-Zero Carbon Emissions by 2050 EB/OL.(04/10/2021)15/04/2022.https:/www.iata.org/en/pressroom/2021-releases/2021-10-04-03/.16 IATA.Our Commitment to Fl

224、y Net Zero by 2050 EB/OL.https:/www.iata.org/en/programs/environment/flynetzero/.17 IATA.2050:Net-zero carbon emissions EB/OL.(2021-12-01).https:/airlines.iata.org/analysis/2050-net-zero-carbon-emissions.18 Aviation Benefits Beyond Borders.Aviation industry reducing its environmental footprint EB/OL

225、.https:/aviationbenefits.org/environmental-efficiency/climate-action/.19 ICAO.Climate Change EB/OL.https:/www.icao.int/environmental-protection/pages/climate-change.aspx.20 Aviation Benefits Beyond Borders.Waypoint 2050 EB/OL.11/04/2022.https:/aviationbenefits.org/environmental-efficiency/climate-ac

226、tion/waypoint-2050/;21 Aviation Benefits Beyond Borders.Aviation industry reducing its environmental footprint EB/OL.11/04/2022.https:/aviationbenefits.org/environmental-efficiency/climate-action/.22 WEF.Deploying Sustainable Aviation Fuels at Scale in India:A Clean Skies for Tomorrow Publication R/

227、OL.(10/06/2021)07/04/2022.https:/www.weforum.org/reports/deploying-sustainable-aviation-fuels-at-scale-in-in-dia-a-clean-skies-for-tomorrow-publication/.23 IATA.Net-Zero Carbon Emissions by 2050 EB/OL.(2021-10-04)24/06/2022.https:/www.iata.org/en/pressroom/2021-releases/2021-10-04-03/.Different scen

228、ario analyses will result in different estimates about SAF demand.For example,according to one scenario introduced by ATAG report,Waypoint 2050,SAF consumption will reach 445 million tons by 2050,accounting for 90%of total aviation fuel consumption.https:/aviationbenefits.org/environmen-tal-efficien

229、cy/climate-action/waypoint-2050/24 ICAO.ICAO Global Framework for Aviation Alternative Fuels EB/OL.24/06/2022.https:/www.icao.int/environmental-protection/GFAAF/Pages/default.aspx;25 IATA.Fact Sheet-Sustainable Aviation Fuel EB/OL.24/06/2022.https:/www.iata.org/en/programs/environment/flynetzero/26

230、ASTM.Standard Specification for Aviation Turbine Fuel Containing Synthesized Hydrocarbons EB/OL.https:/www.astm.org/d7566-21.html.27 ASTM.Standard Specification for Aviation Turbine Fuels EB/OL.https:/www.astm.org/d1655-21.html.28 ICAO.Conversion processes EB/OL.https:/www.icao.int/environmental-pro

231、tection/GFAAF/Pages/Conversion-processes.aspx.29 The White House.FACT SHEET:Biden Administration Advances the Future of Sustainable Fuels in American Aviation EB/OL.(2021-09-09).https:/www.whitehouse.gov/briefing-room/statements-releases/2021/09/09/fact-sheet-bid-en-administration-advances-the-futur

232、e-of-sustainable-fuels-in-american-aviation/.30 The White House.FACT SHEET:Biden Administration Advances the Future of Sustainable Fuels in American Aviation EB/OL.(2021-09-09).https:/www.whitehouse.gov/briefing-room/statements-releases/2021/09/09/fact-sheet-bid-en-administration-advances-the-future

233、-of-sustainable-fuels-in-american-aviation/.31 Ma Dechao,Liu Hua,Xia Zuxi,Thought and Practice:Airworthiness Certification of Aviation Fuels under“Fangguanfu”Reform J,Management Observer,2019(32):92-94.32 Dai Jun,A Perspective on the Airworthiness Management of Aviation Fuels J,Civil Aviation Scienc

234、e&Technology,2011(2):102-104.33 CAAC Department of General Affairs,the 14th FYP for Green Civil Aviation Development,EB/OL,(27/12/2021).http:/ CAAC,Illustration|the 14th FYP for Green Civil Aviation Development EB/OL,(27/01/2022).http:/ National Development and Reform Commission,the 14th FYP for Bio

235、-economy Development EB/OL,(20/12/2021).http:/ Dai Jun,A Perspective on the Airworthiness Management of Aviation Fuels J,Civil Aviation Science&Technology,2011(2):102-104.37 CAAC,CCAR-21-2007 Regulations on Certification of Civil Aviation Products and Parts S,Beijing,CAAC,2008:1-8.38 CAAC,CAAC Compl

236、etes Airworthiness Certification of Sinopec No.1 Aviation Biofuel and Awards Certificate(12/02/2014).http:/ 1997:1-6.CAAC,Regulations on Designated Airworthiness Representatives and Designated Organizational Representative for Civil Aircraft:CCAR-183-1997S,Beijing:China Civil Aviation,1997:1-6.40 CA

237、AC,CAAC Completes Airworthiness Certification of Sinopec No.1 Aviation Biofuel and Awards Certificate(12/02/2014).http:/ Jet Fuel Containing Synthesized Hydrocarbons,or commonly knowns as aviation biofuel,refers to a jet fuel that contains conventional jet fuels and synthesized paraffinic kerosine(S

238、PK)according to definition by CTSO-2C701.SPK is produced by FT or HEFA processing.42 CAAC Department of Aircraft Airworthiness Certification,Airworthiness Certification and Management System EB/OL.https:/ 43 National Energy Administration,Q&A about Biodiesel Policy EB/OL,(31/08/2021).http:/ INSTITUT

239、E OF ENERGY,PEKING UNIVERSITY44 National Energy Administration,356 codes for the energy industry,including Design Code for Forced Infiltration Engineering in Underground Coal Mines EB/OL,(22/12/2021).http:/ First-generation biodiesel is produced via the transesterification of fatty acids and triglyc

240、erides from feedstockssuch as plant oil,animal fat and gutter oilwith small molecule alcohol to produce fatty acid methyl esters(FAME).HVO(hydrotreated vegetable oil,also known as second-generation biodiesel),based on first-generation biodiesel,is produced by hydrotreating and isomerization,which is

241、 paraffin-based.HVO differs significantly from first-generation biodiesel but is similar to SAF in terms of manufacturing process.A HVO production facility with hydrogenation and isomerization units can be easily used to produce SAF.46 Beijing Haixin Energy Technology Co.,Ltd.was previously called“B

242、eijing Sanju Environmental Protection&New Materials Co.,Ltd.”and was renamed on July 15,2022.47 Companies and organizations listed here do not cover all SAF and HVO-related organizations.For example,there are media reports that some other companies have also developed SAF plans,but they are not incl

243、uded because their projects have not been verified to exist.48 About ECO EB/OL,(28/04/2022).http:/ Towngas,Annual Report 2021 R/OL.22/04/2022.https:/ Towngas Smart Energy,Environmental,Social and Governance Report 2021,R/OL.22/04/2022.https:/ Haixin,About us,EB/OL.28/03/2022.http:/ LYZY,Company Intr

244、oduction EB/OL.22/04/2022.http:/ LYZY,Annual Report 2021R.22/04/2022.54 Essence Securities,Biodiesel Industry Leader Expected to Grow Fast Given its Potential in Emissions Reduction and Benchmark NESTE R/OL.(14/02/2022)22/04/2022.https:/ CNAF,About us EB/OL.10/06/2022.https:/ The fifth test flight h

245、appened when Cathay Pacific took delivery of a new plane from France to Hong Kong(Table 5-1).57 Shell.Cutting Emissions from Aviation EB/OL.28/04/2022.https:/ Shell.Shell.Decarbonizing Aviation:Cleared for Take-off.R/OL.(2021)28/04/2022.https:/ Shell.Sustainable Aviation Fuel EB/OL.28/04/2022.https:

246、/ Shell.Sustainable Aviation Fuel EB/OL.28/04/2022.https:/ IATA.Developing Sustainable Aviation Fuel(SAF)EB/OL.https:/www.iata.org/en/programs/environment/sustainable-aviation-fuels/62 Aviation Benefits Beyond Borders.Sustainable aviation fuel EB/OL.24/05/2022.https:/aviationbenefits.org/environment

247、al-efficiency/climate-action/sustainable-aviation-fuel/63 Cathay Pacific.Corporate Sustainable Aviation Fuel Program.EB/OL.27/06/2022.https:/ Some companies have been reported to plan new SAF production capacities,but without specifics,so these companies are not covered in this report in view of hig

248、h uncertainty.65 Some companies have been reported to plan new SAF production capacities,but without specifics,so these companies are not covered in this report in view of high uncertainty.66 In addition to production capacities under the HEFA pathway,capacities under the AtJ or FT pathway may also

249、appear before 2025,but this is highly uncertain.Therefore,they are not covered in this report.67 China still has a long way to go before it can adopt the technical pathway of using green hydrogen to produce SAF on a commercial scale.The prospects of producing SAF from energy crops are relatively unc

250、ertain,so energy crops as SAF feedstocks are not covered in this report.68 Tian Yishui,Shan Ming,Kong Geng,Ma Linwei,Shao Si,et.Al.A Strategy Study of Chinas Biomass Economy DevelopmentJ/OL,Engineering Science,2021,23(1):133-140.https:/ Idem.Estimates about available agricultural and forestry wastes

251、 vary significantly across the industry.This report adopts conservative estimates.70 There are also studies believing that the availability of forestry biomass resources may total 300 million tons(https:/ report adopts a conservative estimate of 195 million tons.71 Ministry of Housing and Urban-Rura

252、l Development.China Urban-Rural Construction Statistical Yearbook.https:/ Marginal land refers to land that cannot be used to produce food crops,but can be used grow stress resistant energy crops.73 EUR-Lex.DIRECTIVE(EU)2018/2001 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL EB/OL.(11/12/2018).https

253、:/eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2018.328.01.0082.01.ENG&toc=O-J:L:2018:328:TOC.74 European Commission.Renewable Energy Recast to 2030(RED II)EB/OL.https:/joint-research-centre.ec.europa.eu/welcome-jec-website/reference-regulatory-framework/renewable-energy-recast-2030-red

254、-ii_en.75 European Commission.Sustainable aviation fuels ReFuelEU Aviation EB/OL.https:/ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12303-Sustainable-aviation-fuels-ReFuelEU-Aviation_en.76 EPA.Summary of the Energy Independence and Security Act EB/OL.https:/www.epa.gov/laws-reg

255、ulations/summary-energy-independence-and-security-act.77 U.S.Department of Energy.Summary of the Energy Independence and Security Act EB.OL.https:/afdc.energy.gov/laws/eisa.78 IATA.Net zero 2050 sustainable aviation fuels EB/OL.https:/www.iata.org/flynetzero/.79 National Energy Administration,Q&A ab

256、out biodiesel policy EB/OL.http:/ The White House.FACT SHEET:Biden Administration Advances the Future of Sustainable Fuels in American Aviation EB/OL.https:/www.whitehouse.gov/briefing-room/statements-releases/2021/09/09/fact-sheet-biden-administra-tion-advances-the-future-of-sustainable-fuels-in-am

257、erican-aviation/.81 Office of ENERGY EFFICIENCY&RENEWABLE ENERGY.Sustainable Aviation Fuel Grand Challenge EB/OL.https:/www.energy.gov/eere/bioenergy/sustainable-aviation-fuel-grand-challenge.Institute of Energy,Peking UniversityAdd.:Rm.438 Peking University Yanyuan Building,No.5 Yiheyuan Road,Haidian District,Beijing,ChinaZ.C.:100871Email:Tel:+86-10-62751150HTTPS:/ENERGY.PKU.EDU.CN/This report used environmental friendly paper.