Context: The Civil Aviation Ministry pointed out that high value-added tax (VAT) rates on aviation turbine fuel (ATF) imposed by certain states in India contribute significantly to increased airfare.
Relevance of the Topic: Prelims: Key facts about Aviation Turbine Fuel (ATF); Sustainable Aviation Fuel (SAF).
Aviation Turbine Fuel (ATF)
- ATF is a type of aviation fuel designed for use in aircrafts and jet engines.
- Constituents: Jet fuel is a mixture of a variety of hydrocarbons. The most common ATF is Kerosene-type jet fuel.
Concerns:
- Price-sensitive: The price of ATF is a major component of the operating cost of airlines, and the tax on ATF significantly contributes to the ATF price. The Ministry of Civil Aviation has long advocated for bringing ATF under GST (Goods and Services Tax) to eliminate tax disadvantages faced by domestic airlines compared to foreign carriers.
- Environmental pollution: ATF combustion in aircraft engines releases various pollutants like Nitrogen oxides, Carbon monoxide, Particulate matter etc. leading to ozone layer depletion and global warming.
Sustainable Aviation Fuel (SAF)
- SAF is a biofuel alternative to conventional jet fuel with a smaller carbon footprint.
- It can be blended with conventional jet fuel (with blending limits ranging 1%-50%).
- Sources of SAF:
- Oil seeds, other fats, oils, and greases
- Residues- agricultural, forestry residues, wood mill waste
- Wastes- municipal solid waste, sludge and wet waste
- Produced synthetically by capturing carbon directly from the air.
Advantages:
- Engine compatibility: can be used in existing aircraft and infrastructure.
- Fewer emissions: 100% (pure) SAF has the potential to reduce greenhouse gas emissions by up to 94% depending on feedstock and technology pathway.
- Sustainable: SAF feedstock does not compete with food crops, neither causes forest degradation.
Challenge:
- Expensive: SAF is about four times more expensive than petroleum jet fuel.
SAF indicative blending Target:
- In 2022, members of the International Civil Aviation Organisation had agreed to a long-term aspirational goal of net-zero carbon dioxide (CO2) emissions from aviation by 2050, and SAF has long been seen as the industry's fastest way to reduce emissions.
- In 2023, Indian government has set the following initial indicative blending percentages of SAF in ATF:
- 1% SAF indicative blending target in 2027 (Initially for International flights).
- 2% SAF blending target in 2028 (Initially for International flights )
- 5% by 2030.
The success of SAF will require using a greater diversity of feedstock and production methods. This includes areas such as investing in carbon offset programmes and the diversification of SAF feedstocks.