The production and widespread supply of sustainable aviation fuel (SAF) and unleaded avgas will be key for aviation to meet its environmental sustainability goals. BCA Senior Editor Bill Carey discusses industry progress toward deploying SAF and unleaded avgas with National Air Transportation Association CEO Curt Castagna and Managing Director of Industry & Regulatory Affairs Megan Eisenstein.
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Hello, this is Bill Carey, senior editor with Business and Commercial Aviation, and welcome to this Aviation Week BCA podcast. I am pleased to be joined today by Curt Castagna, president and CEO of the National Air Transportation Association, and NATA Managing Director of Industry and Regulatory Affairs, Megan Eisenstein, to discuss two aviation fuels that are key to the industry achieving its environmental goals—sustainable aviation fuel, or SAF, which is sustainably-sourced Jet A fuel for jets, and unleaded avgas used by piston engine aircraft. Thank you, Curt and Megan, for meeting with me today.
Bill Carey: Let's start with the issue of unleaded avgas, because that's been in the news very recently. The Environmental Protection Agency on Oct. 7 announced a long-anticipated draft finding that lead emissions from piston-engine aircraft that operate on leaded fuel endanger public health. The FAA and industry have been working on developing an unleaded avgas that works across all piston engine aircraft for more than a decade now. Under the EAGLE initiative, and that stands for Eliminate Aviation Gasoline Lead Emissions, which was announced in February this year, stakeholders have committed to phasing out leaded avgas by 2030.
Curt, I'll pose this question to you. How many, or roughly what percentage, of FBOs supply avgas for piston-engine aircraft, and is the current 100 Low Lead avgas a significant piece of their business, for instance, compared to supplying Jet-A for jets?
Curt Castagna: Great question, Bill. Happy to be here today and thank you for the opportunity for Megan and I to join you. In regard to your question about FBOs, there's a number of sources that we can cite for that inventory of FBOs. AirNav, back in 2019, reported that there were about 3,583 FBOs that were selling 100LL in the United States, and there's been other ACRP [Airport Cooperative Research Program] reports during that same time that refer to that same information. And so, in the grand scheme of the percentage of avgas to jet fuel, we can share some data that I think will put it in perspective.
Depending on the sources you look at, there could be upward of 95 billion gallons of jet fuel sold worldwide. I think in the United States, the airline industry itself is roughly in the mid-30 billion gallons of jet fuel used annually. In the business aviation sector, that number for jet fuel is about 1.7 billion gallons. And then in avgas, it's roughly nationally about 180 million gallons of fuel. That fuel in the United States is serving about 223,000 piston aircraft that are registered with the FAA.
I believe some of those numbers will put in perspective that data point, and as well, those FBOs are also positioned at about 3,300 NPIAS, which is the National Plan of Integrated Airport Systems in the FAA categorization. So, there's roughly 3,300 NPIAS airports and that's somewhat relevant, because those NPIAS airports today are receiving federal monies for AIP funds for their airports. Roughly 396 of those airports are primary airports and about 2,900 of them are non-primary or general aviation airports. Safe to say that the number of FBOs and the number of piston aircraft, aviation gasoline is being served primarily at non-primary airports, general aviation airports.
Bill Carey: Okay, but that's a considerable distribution across 3,000 locations.
Curt Castagna: Correct. And obviously every airport is different, and when we get into the nuances of unleaded fuel and what airports can do today, those differences become important, because there isn't a 100% drop-in replacement today.
Bill Carey: In August of 2021, over a year ago now, the Santa Clara County California Board of Supervisors voted to ban the sale of 100 Low Lead avgas at Reid–Hillview and San Martin airports in the San Jose area, as of this January, January of 2022. Are other airports and FBOs around the country following their lead in attempting to phase-out 100 Low Lead?
Curt Castagna: Being from California, I'm proud to say that we are on the leading edge of issues, so goes the rest of the country. But I would say we're not seeing necessarily that trend across the country. What's important to realize is that first of all, lead in fuel isn't a new issue. It's an issue the industry's tackled for years, and as you noted, we now have an unleaded fuel product out there today and have for the last 10 years. It's really the result of the focus on environmental mitigation measures all across the transportation hub, whether it's electric vehicles and/or aircraft, and there's this shift in our leadership in the country relative to environmental sustainability. Where you have airports like Reid-Hillview [that are located] in a community, it's not just so much about banning their fuel, it's whether or not that airport fits into their business plan for that community. The avgas becomes an argument for certain political arguments of expediting or speeding up the closure of the airport by eliminating services.
I think other airports have looked at that model. I could point to Santa Monica, which has evaluated that same thing. Santa Monica, however, much like Reid-Hillview, did implement unleaded fuel at its airport, the first in Southern California to do that, and it hasn't yet banned the current low-lead fuel that's being provided there. And again, that becomes the challenge for the industry because as you know, the EPA just came out with the proposed rulemaking for the endangerment finding. But we still have another executive branch in the FAA, and airports are required to adhere to certain grant assurance obligations, or in the case of Santa Monica, their consent decree that was executed between the FAA and the city on the provision of services.
Where we see airports really looking at the banning of fuel, it really depends on who owns the tanks. In communities like Reid-Hillview or Santa Monica where they actually own the infrastructure, it becomes maybe an easier argument for a community to say, ‘We're going to just ban the product,’ albeit not without a challenge possibly from the FAA or the users.
But you have other airports, general aviation airports, that might even have multiple FBOs with long-term leasing interests where there's multiple capital investments and hangars and office facilities, including underground fuel. Those leases also have the requirement to sell 100 Low Lead because their airport minimum standards require it.
It would be a much different challenge by an airport to then go and terminate multiple lease agreements with their users to ban the fuel without extensive litigation, and then the challenge between the FAA and the airport, whether or not they were restricting access. It becomes a very complicated path that we're navigating here toward the evolution to a non-leaded product. But ultimately, what we need is a rational transition period, much like we had during the '70s when we did this same thing in the automobile industry.
Bill Carey: The unleaded fuel that you're talking about at Santa Monica, I think you're referring to Swift Fuels' UL94, is that correct?
Curt Castagna: That's correct.
Bill Carey: Okay. And then the unleaded avgas that recently was approved for the broad extent of piston engine aircraft and engines through the FAA STC process was the GAMI fuel. I think they call that G100UL.
Curt Castagna: It's a complex discussion, Bill, from the standpoint of, so Swift Fuels entered into the PAFI [Piston Aviation Fuels Initiative] program long ago, and they went through the process to do really three things. They pursued the STC with the FAA for their product. That's a separate path or silo. They pursued approvals with the ASTM standards for the fuel that they were producing so that it would meet ASTM standards, which in some people's mind is critical when you get to the actual refinement of the recipe. Down the road is that you have one common approved recipe of fuel. And then you have the third silo, which is the aircraft engine companies, let's say Teledyne and Continental and Lycoming that have the majority of the piston engines, and they have their own approval process independent of the FAA's STC program.
GAMI has gone down the process of receiving the FAA's STC approval. It's still unknown whether or not they've received the approval of the engine manufacturers of the testing that they would like to do on the GAMI product, and as well, if GAMI has received ASTM or will pursue ASTM standards approval for its product. And we have to remember, its product is not yet commercially available to the marketplace. They're working on that piece of their program through the EAGLE initiative.
You have these parallel paths. You have EAGLE, and PAFI is somewhat still in existence, and you have a couple other providers besides Swift and GAMI in the process, Phillips 66 being one of them, and they're looking at their own alternatives. But they all are going to go through this engine approval, ASTM possibly, and the FAA. What's important is the FAA was just one step in the GAMI process. And going back to Swift Fuel, it's been around for 10 years. It's known that it only serves today maybe 65% to 70% of the commercial piston fleet of that 228,000 aircraft I mentioned. That's where, when you talk about 3,600 approximate FBOs in the country, every airport's got to evaluate its fleet at its own airport to see what fleet of aircraft it has at that airport, and how it might apply today to the UL product that's out there.
Airports, for instance, in California, where this is very sensitive, they should be evaluating their fleet of aircraft at their airport to see what percentage of aircraft could accommodate the UL94 today, while a 100% drop-in replacement goes through the continued approval process. Airports that do that then are on the leading edge of at least participating in the transition in advance of the EPA endangerment finding. And if we can work together in industry, regulatory and legislatively, for a transition period that makes rational sense, we should have products available, prior to the completion of that endangerment finding, that are approved.
Bill Carey: The NATA recently issued a white paper that provides guidance for FBOs and fuel service providers that are making that transition, and I think there were four phases that you defined in that white paper to transition from offering 100 Low Lead to an unleaded aviation alternative. We're going to move on to sustainable aviation fuel, but will the transition necessary in the case of leaded aviation fuel to unleaded avgas, do you expect that to be more difficult or costly, for instance, than FBO's, airports, other locations deploying an infrastructure for sustainable aviation fuel?
Curt Castagna: There's a few questions in there. One, I would say, until such time that there's a demonstrated foundation for a supply chain that is consistent, pricing's going to be challenging. The current UL94 product rail cars out to California and then is trucked to other airports from there. That does impact its cost. There is a premium for that fuel today, and hopefully with more refinement and supply chain, that will level out. That's certainly a concern of the users.
But to your point, because today the UL 94 needs to be segregated. Unlike SAF, UL94 needs to be segregated, unlike GAMI's product that might be a drop-in [replacement]. So, infrastructure is important. Different fuel trucks, different tanks, and therein lies what NATA's position is, our first and foremost effort here is in the training and in the quality control and training of folks on how to manage these different blends of fuel so that we don't have issues of misfueling. We're trying to keep that front and center in our messaging to our members, because it's likely that we will have different fuel products.
Bill Carey: Do you feel confident that transition will be accomplished by the EAGLE goal of 2030?
Curt Castagna: I think so. I do feel confident in that, Bill. The EPA endangerment finding is a 12-to-18-month process. It's obviously a political and bureaucratic process, but realize when that process is done, it comes back to the FAA for its own notice of proposed rulemaking and regulatory process, so add another 12-to-13 months on top of that.
What's really critical is, while that's going on, in the meantime, do we have the support in industry, in the FAA, through the EAGLE initiative to really get the refiners and the approvals necessary for a 100% drop-in replacement and the testing that's necessary with ASTM and the engine manufacturers, so that we can really in effect, ignore the rulemaking to ban it and focus on the solution for the replacement. That's really the critical piece to me. I think legislatively, we should be looking at ways to encourage incentives for the refinement of this product so that we increase the distribution chain to bring an unleaded product to airports sooner than later. Megan, did I miss anything that you'd like to add?
Megan Eisenstein: No, Curt. I think you covered a lot of what we've been working on recently. I think down the line, like Curt mentioned, we just released that white paper on considerations for aviation fuel providers, and I think you'll be seeing some more guidance coming out of the association moving forward as the EAGLE program continues to move along.
Bill Carey: Well, thank you for enlightening me on some of the complexities of this that I didn't fully appreciate, all the different considerations, legal and otherwise, of making the transition, but that's helpful. Let's talk about SAF. What is this status of building a nationwide fueling infrastructure for SAF that benefits business aviation specifically? And how many FBOs now offer SAF? And I may have the answer to that question, having spoken with 4AIR recently. It's something on the order of two dozen in the United States, mostly concentrated in California. But I guess, from the NATA perspective, what is your expectation for that availability for that network to grow or expand?
Megan Eisenstein: 4AIR is fantastic. We work closely with them on a lot of fronts. They are NATA member. They do participate on several of our policy committees, so I was actually going to reference one of the guidance materials that they have. They actually have an SAF locator map on their website, which is fantastic. Currently we see that they have about 38 FBOs [identified].
Bill Carey: 38, okay.
Megan Eisenstein: With others expecting to join their ranks soon. The rise in offtake agreements with strategic partners across all links in the aviation fuel supply chain pretty much signified a move toward network growth. We're really working with a lot of our industry partners to educate the industry on book-and- claim, ensuring that we work on the scale up of SAF production, and to allow for product and transaction tracing. It's also a means of verifying relevant data and proper accounting and claiming of environmental benefits. We are part of the Business Aviation Coalition for Sustainable Aviation Fuel, along with lot of the other GA associations. We meet almost every other Thursday, continuing to read the industry, read what they need, and provide as much guidance and materials as possible.
Bill Carey: In August, Congress passed the Inflation Reduction Act of 2022, which contained a Blenders Tax Credit that had long been sought by business aviation, or supported by business aviation to incentivize SAF production. Will that tax credit play a significant role in supporting or expediting the availability of SAF at airports?
Megan Eisenstein: Yes, we believe that it will. Our in-house lobbyist has really been working on this issue over the past couple of years, and NATA endorsed the Sustainable Skies Act, which was introduced in 2021, then worked with a comprehensive coalition of industry stakeholders to really encourage the inclusion of similar provisions in broader spending proposals. But as you mentioned, the Inflation Reduction Act of 2022 included two years of such tax credits valued at $1.25 to $1.75 per gallon, depending on the percentage of lifecycle greenhouse gas emissions compared to fossil-based jet fuel. The tax credit for SAF helps level the playing field with more established biofuels, and sends the right signal to investors to attract that capital that is needed.
Bill Carey: Similar to our discussion on unleaded avgas, what are the costs or challenges that FBOs should consider in terms of transitioning their local fuel infrastructure to SAF?
Megan Eisenstein: As most know, SAF is a drop-in jet fuel produced from non-conventional sources, so we believe there really aren't any changes required in aircraft or engine fuel systems or the distribution infrastructure of storage facilities. There are two FBOs that provide a continuous supply of SAF, and they do not need separate tanks. It's all just co-mingled with the current Jet-A provided.
Curt Castagna: They were initially isolating the fuel, and now they're drop-in. They're blending the fuel in the tanks. And Bill, as you see this conversation unfolding, you can see that SAF is somewhat more advanced than the avgas process because one, we have an ASTM-certified replacement; with avgas, you're talking about fuel that isn't necessarily ASTM for a 100% drop-in replacement. With SAF, you see the Congress has passed this legislation to encourage the tax credits and other things for the refinement. That's the same path we need to move down ultimately with avgas for the same reasons, to bring this fuel to market. Because the issue, I think, with SAF today is it's not so much an issue of interest. I think there's interest by our members today to burn the fuel, and it's different between the type of users that are interested in it, Part 91 vs. Part 135 charter, etc.
At the same time, there's not a consistent supply. Because of that, the users that are interested are having to balance their efforts through a book-and-claim program. It really boils down to, how do we get the fuel to market sooner? But how do we have legislative processes that aren't slowing down or impacting negatively the transportation system? For instance, with avgas, I would say that if you're going to ban avgas and close an airport by doing so, theoretically, you're crippling the aviation network that the United States has been known for, with 3,500 FBOs and almost 20,000 airports.
Megan Eisenstein: We have an environment committee, and late last year, we met down in Miami during our annual conference, and a lot of our FBO members were really asking for some guidance material on a SAF delivery receipt. And Kennedy Ricci, who's president of 4AIR, was actually sitting in that meeting. He said, "Hey, we're actually already sort of developing such a document." This was announced just this past July. We partnered with 4AIR and we announced the first ever SAF delivery receipt for business aviation. That sort of acts as like a W2, so to speak, for sustainability. It really allows operators to document their use for reporting.
The receipt allows FBOs to provide industry-requested standardized documentation to these business aviation operators. A lot of folks, especially out in California who are uplifting SAF, were literally going to the front desk at the FBOs saying, "Hey, I uplifted SAF. I need the documentation. I need to know what type of blend this is. I need to know the feedstock used." This was something we heard from our members. This is something they needed, so 4AIR really was instrumental in developing that receipt. We like to just let everybody know that that is out there for use. It's on the NATA website and the 4AIR website, so I hope it's useful.
Bill Carey: I think that standard form will really help at the FBO level in terms of the documentation of the storage and use of SAF by operators so that they can claim the credits associated with using SAF. Whereas to my question on infrastructure, that's more of an upstream consideration perhaps for refiners or distributors, since SAF is a drop-in replacement for Jet-A. It is Jet-A.
Megan Eisenstein: Kennedy Ricci really likes to call this receipt, “the last mile uplift.” It is that last link between the FBO and the operator. There's documentation required between the fuel producer and the distributor, and this was sort of the last link that was missing, so that's what this receipt acts for.
Bill Carey: Well, I've run through my list of questions. Curt and Megan, thanks again for participating today, and thank you to our audience for listening. I'd also like to give a shout out to our producer, Alex Harrell. That's a wrap for this edition of Aviation Week's BCA podcast. You can subscribe to the BCA podcast in Apple Podcast, Google Podcast, Amazon Audible, and Spotify. Please join us again soon for another episode. Thank you.
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