“This is an industry that creates absolutely gigantic amounts of emissions per person and it delivers essentially zero public benefit,” said Alethea Warrington, senior campaigner at environment charity Possible. “It is simply not viable for a small group of ultra-wealthy people to keep flying around on almost empty private jets, producing a huge amount of emissions, particularly given that these flights are virtually tax-free.”

All three of the speakers said that they were opposed to the inequality of business aviation as well as the environmental effects. “Ultimately, when mayors all across the world and politicians are asking people to change their habits,” said Zack Polanski, deputy leader of the Green Party of England and Wales. “How possibly can elected politicians do this when at the same time people are flying and soaring through the skies in private jets literally mocking those in poverty beneath them?”

“There’s no environmental justice without social, racial, economic justice too”

Polanski was asked if the inequality is more important than the environmental impact. “There’s no environmental justice without social, racial, economic justice too. All these things are inextricably linked. The environmental reason is clearly a top high priority because we’re talking about ecological collapse. Fundamentally, private jets are the pinnacle of climate justice because this is where super-rich get to do something that is disproportionately polluting, disproportionately noisy,” he said. “The problem is for the climate, but actually it’s inequality, too, because those are two sides of a cent coin.”

Todd Smith, a former airline pilot and founder of Safe Landing, stressed his love of flying but said it is no longer able to work in aviation. “I believe corporate jets have played a pivotal role in connecting our world in a way which was previously unimaginable. That said, I had a realisation that the climate is breaking down rapidly, and ultimately, my conscience will no longer allow me to be a part of the aviation sector.”

Kurt Edwards, director general, International Business Aviation Council, said that there is still much misunderstanding about business aviation. “When I’m traveling visiting my associations around the world, I can see they are keen to grow the industry because they don’t have the connectivity that a lot of places do, and they need it for their own businesses,” he said. “They need it for their livelihood. Think of the medevac, think of humanitarian lift that comes with these aircraft as well. It’s an exciting time for the business and we see a lot of young folks coming in because of the commitment we have made in terms of the environmental sustainability going forward. The business aviation community along with the rest of the global aviation community has committed to net zero carbon emissions by 2050.”

Safe Landing’s Smith could not believe he was invited to speak after protesting at London Farnborough Airport with Swedish activist Greta Thunberg the week before.

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The Monterey Fuel Company started offering Avfuel’s supply of Neste MY SAF in 2021. Neste produces SAF from sustainably-sourced, renewable waste and residue materials including used cooking oil which meets ASTM D-1655 specification.

“Our team is honoured to receive this recognition, proud to support our eco-conscious community, and thankful to Avfuel for enabling us to be at the leading edge of sustainability by providing SAF at the highest blend ratio available. Through this partnership, we’re able to accomplish real progress toward aviation’s CO2 reduction goals by offering flight departments and operators a pathway for decreasing their environmental impact,” said Matthew Wright, vice president, Monterey Fuel Company.

Monterey Fuel Company will receive carbon credits instead of traditional trophy or plaque. Avfuel purchased carbon credits in the Monterey Fuel Company’s name and will present the certificates to the company at Del Monte Aviation.

The fuel company was awarded for its efforts in significantly scaling SAF sales at its Del Monte Aviation FBO. SAF sales at the FBO have increased considerably since it began offering the fuel.

Today, the FBO accounts for 94% of SAF transactions on the MRY field, positioning itself as a leading SAF provider not only on the West Coast, but globally, and putting its commitment to support CO2 emissions reductions in action.

“The Monterey Fuel Company has been a huge champion for the adoption of sustainable aviation fuel,” said Keith Sawyer, manager of alternate fuels, Avfuel.

“It was the first company to work with Avfuel to provide an FBO with consistent supply of SAF back in March 2021. Its FBOs, Del Monte Aviation (KMRY) and Monterey Jet Center (KMRY), have continued to be strong advocates for the use of SAF at Monterey Regional Airport ever since and have transitioned multiple high-volume customers to the sustainable option. We felt their eagerness to lead SAF efforts from the forefront of the initiative was worthy of recognition.”

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The G600 aircraft, powered by Pratt & Whitney PW815GA engines, departed from Gulfstream’s headquarters in Savannah and landed at Farnborough Airport, UK.

“Gulfstream is innovating for a sustainable future,” said Mark Burns, president, Gulfstream. “One of the keys to reaching business aviation’s long-term decarbonisation goals is the broad use of SAF in place of fossil-based jet fuel. The completion of this world-class flight helps to advance business aviation’s overarching sustainability mission and create positive environmental impacts for future generations.”

The SAF was made of 100% Hydroprocessed Esters and Fatty Acids (HEFA) by World Energy at their Paramount Facility, California and was delivered by World Fuel Services.

The data gathered from the flight will help gauge aircraft compatibility with low-aromatic renewable fuels, especially under cold temperatures for extended flights.

Anthony Rossi, vice president, Sales and Marketing, Pratt & Whitney said this was a major step as they continue to validate the compatibility of their engines with unblended SAF.

“We’d like to thank all our partners for their help in making this milestone flight happen, and for their ongoing partnership in collaborating with the extended SAF community to champion the aviation industry’s path to 100% SAF usage,” said Burns.

Gulfstream are also the first business jet Original Equipment Manufacturer (OEM) to fly on 100% SAF.

This announcement comes just a week before Virgin and Rolls Royce plan to fly the first commercial aircraft trans-Atlantic flight using 100% SAF on November 28^th, taking off from Heathrow and landing at New York JFK.

SAF Investor spoke with Gene Gebolys, president & CEO, World Energy recently on The SAF Podcast, listen to the full episode here: https://www.buzzsprout.com/2202964/13894405

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Customers can now refuel at each of the five locations, four of which offer self-serve machines. These latest additions to Air bp’s network demonstrate its commitment to New Zealand and to the general aviation sector, said the company. It brings the total number of locations in the country close to 50.

Air bp acquired the locations from an existing fuel supplier from late 2022 to early 2023 and has updated bowsers and other equipment with further investment anticipated. 

Scott McCarthy, sales manager, General Aviation ANZ, Air bp said:  “We are pleased to be growing our network in New Zealand, which is an important market for Air bp.  This latest acquisition enables us to strengthen our presence in New Zealand particularly in the general aviation sector, to build new relationships with customers and grow established relationships by having a broader offer to the NZ aviator. The geographical spread of the new additions aligns well with our strategy, and we are looking forward to providing the general aviation community with a greater range of refuelling options.”

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Trappier’s warning is significant, according to Rob Stallard, partner Global Aerospace and Defence, Vertical Research Partners. “I’ve not seen any other aerospace company put a slide into their accounts about jet bashing,” he tells CJI. “I didn’t think it would be quite so blatant as Dassault accusing people of jet bashing. It’s reflective of the press coverage in France and Europe.”

This may reflect the company’s European roots. “Behind the scenes, companies in the US are well aware of the issue, which can be seen in the investment in Sustainable Aviation Fuel that is happening,” says Stallard. “But the US is lagging behind on ESG [Environmental, Social and Governance] issues. ESG is much lower on the agenda for them.”

Investment fundamentals are likely to win precedence in investors’ minds, according to Brian Foley founder of the consultancy Brian Foley Associates. “There is already pushback from some fund managers who insist on investing in fundamentals, not the ideology du-jour,” he says. “Regardless, objective data suggests ESG investments aren’t performing as well as their peers, and some investors will bring their funds elsewhere if not given a choice. Thus, longer term I wouldn’t see any measurable impact on the aviation sector.”

Much of the current debacle arises from banks having underlying assets (bonds) and being forced to sell them at a loss before maturity to cover customer withdrawals, says Foley. “That said, there will be an ongoing rout in startup, early-stage and high-debt aviation companies as capital becomes harder to obtain as investors find higher return opportunities as interest rates rise.”

Brian Flynn, MD, venture capital firm DiamondStream Partners – which is typically an early stage investor – notes the inevitable (and desirable) greening of corporate agendas. “Most or nearly all of the companies in which they’ve invested are articulating more clearly what they are doing to reduce their environmental footprint,” he tells us. “This is both the right course of action and one that will rightfully dampen some of the criticism. Some aviation investors feel more strongly than others, but I’ve not heard of any exiting their aviation investments because the companies in which they’ve invested are not working to reduce their carbon footprint.”

For Flynn, communicating facts and goals is the best way to combat environmental criticism of aviation and to educate those who are upset. “The environmental activists will surely hold the companies accountable for achieving their goals. And maybe, in some cases, encouraging those companies to set the bar higher.”

It was also a tough week for banks since the fall of Silicon Valley Bank. Stallard, at Vertical Research Partners, sees a connection with business aviation. “I think what’s going on with the banks isn’t going to have much of an impact on the aerospace sector,” he says. “But it could be a symptom of what’s happening on a wider scale. I think the levelling off in demand that we’re seeing in business aviation is partly linked to the technology companies not doing as well as they had hoped.”

Returning to “aviation bashing”, Foley at Brian Foley Associates, ends on an ominous note: “There are certainly bigger fish to fry than business aviation’s 0.04% annual worldwide contribution to greenhouse emissions. But none are as sexy and attention-getting.”

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The five insights were: War and sanctions, Living with Covid, Sustainability and carbon neutrality, Lessons in governance, Booming values and looming recession. 

“Business aviation can now be considered post-pandemic,” said the company. “However, despite the relief at leaving Covid behind, we have entered a new era where events – war, sanctions and recession – which we all thought were confined to history are back.”

War and sanctions, after the Russian invasion of Ukraine, is having a big impact on business aviation. “Restricted flying for all Russian nationals across Europe, America and Australia, together with asset seizures and sanctions has resulted in significant cuts to income streams for many in the business aviation industry.”

Sanctions sparked record business for specialist legal counsel to understand the restrictions and how these apply between jurisdictions, said the company. Attempts to circumvent the rules have led some to incur fines, confiscations and other penalties. One recent example, in Malta, was aircraft operator, Emperor Aviation sanctioned by the US Office of Foreign Assets Control (OFAC) along with eight related aircraft. 

Despite hopes for a speedy resolution of the conflict, the company warns business aviation should expect sanctions to be a continuing theme throughout 2023 and beyond. “Sanctions, restrictions and the damage to business aviation in Russia will likely only worsen in the short term.”

Living with Covid will remain a key trend this year, as in 2022. “Kicking off with CJI London in February over 500 colleagues from around the world were eager to meet in person, catch up and generate new business,” said the company. “In May, following a two-year hiatus, EBACE saw over 12,000 visitors and over 300 exhibitors at Europe’s flagship business aviation event.” Also, the Isle of Man Aviation Conference celebrated its tenth anniversary in its 12th year with “bumper numbers of attendees and sponsors”. 

But questions have been asked whether the lessons of the global pandemic have been forgotten in the rush to reconnect, said the company. “The next few years may see a balancing between in-person events and video interactivity to develop relationships and get deals over the line.” Martyn Fiddler believes face-to-face meetings and conferences will continue to be the preferred form of networking. 

Sustainability and carbon neutrality was another insight from last year. While business aviation is not the only industry to be placed in the spotlight by climate groups, it does attract considerable media attention due to high profile aircraft owners. “While many in the industry correct misleading media claims about emissions – business aviation only accounts for 0.2% of global CO2 output – some leaders are now saying it is not enough simply to be reactive in such situations,” according to the company. 

Although a proactive approach is needed to defend business aviation’s sustainability record, the company also highlighted the need for care when reacting to climate critics on social media platforms. “This warning comes after posts from commentators on LinkedIn regarding the Schiphol protests [last November] were taken as direct quotes from the industry by leading newspapers and media outlets. While the authors of the posts most likely did not think this would happen at the time of writing, this is the danger of the digital age.”   

Sustainability and reducing emissions was at the forefront of every business aviation event last year. Continued progress in 2023 depends on taking the initiative in  messaging and being “mindful of how the industry presents itself to the rest of the world”. 

Lessons in governance learnt in 2022 will continue to apply in 2023. The fallout from the collapse of Greensill Capital caused significant damage to Credit Suisse, and lawsuits continue to hurt Boeing’s rehabilitation, noted the company. KPMG received a multimillion-pound penalty in relation to its audit of Rolls-Royce, and Airbus faced a class-action lawsuit in the Netherlands regarding claims it failed to adequately disclose information. 

The promotion of ESG (environment, social and governance) by prominent business leaders and high profile investors is at an all-time high, said Martyn Fiddler. Also, there are regulatory and social initiatives to encourage better corporate governance around the board table internationally. “Often the problem businesses experience with governance is implementation; businesses either don’t understand the benefits of good governance or consider lip service to governance sufficient to avoid scrutiny – ‘governance washing’.”

Booming values and looming recession was the final insight likely to shape business aviation this year. Last year saw rising aircraft prices and higher numbers of first-time buyers coupled with falling global inventory. This resulted in manufacturers boosting production and the second hand market experiencing unprecedented demand, said the company.

“Peaks and troughs are nothing new for business aviation, however, 2023 will expose which businesses have learnt lessons from the crazy highs and dismal lows of the last decade,” said the company. “Have businesses put in place mechanisms to safeguard themselves as demand diminishes?” 

Recession may benefit those well placed to see opportunities and bargains, but many businesses, both new and established, will suffer, predicted the firm. “We believe that economic gains will shift during 2023 – as they do in each recession period -–and those that benefit will look to business travel to further their returns.”

The company concluded the five insights with advice to expect the unexpected during 2023. “We can only face the future if we have a flexible (rather than fixed) mindset,” it said.       

Five top business aviation insights from last year

1. War and sanctions
2. Living with Covid
3. Sustainability and carbon neutrality
4. Lessons in governance
5. Booming values and looming recession.

• Source: Martyn Fiddler Aviation.

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A survey of senior executives with S&P 500 companies and other large corporations found that 79% believed a combination of SAF and business aviation’s improving sustainability record would result in more private jet purchases.

The survey found that 43% of respondents who do not currently own a jet but plan to buy one in the next few years attributed their prospective purchase to the growing focus on sustainability.

More than two-thirds (67%) of those who own a business jet and expect to upgrade in the next five years, said they would focus on models that can make greater use of sustainable fuel.

Sean McGeough, vice president, Commercial ACJ for North America said: “Business aviation’s commitment to reducing its impact on the environment makes owning an aircraft more appealing and this is becoming a much more important issue for those buying them.”

ACJ’s research also found that 75% of executives believe that US corporations are looking to make greater use of their aircraft to support their wider ESG (environmental and social governance) strategies. This includes redeploying corporate jets as air ambulances.

McGeough added that ACJ is developing technology that reduces the environmental impact of its aircraft. “For example, our new ACJ TwoTwenty uses advanced materials and technology for lower fuel burn and maintenance costs. It has 50% lower emissions per square metre when compared with large business jets in general,” he said.

The ACJ TwoTwenty is said to have a 20% lower fuel burn compared with older aircraft and is certified to fly with a 50% blend of SAF. ACJ said that its goal is to achieve 100% SAF certification by 2030.

Meanwhile, the conclusions were based on research conducted by Pureprofile, which surveyed 100 senior executives of S&P 500 companies and other large corporations in June 2022.

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The partnership will offer IADA members a free carbon assessment and discounts on voluntary carbon-cutting programmes and regulatory monitoring and compliance services. The carbon calculator will enable dealers to measure the carbon impact of specific aircraft.

“IADA is joining the fight against climate change in a responsible and sensible way,” said David Monacell, chair, IADA. “The partnership with 4AIR is a statement that the leaders in the business aviation resale industry place importance on sustainability.”

Kennedy Ricci, president, 4AIR said: “With today’s growing scrutiny of private travel and its impact on the environment, it’s increasingly important to be able to assist buyers and sellers to answer questions about prospective aircraft and their environmental impacts.”

Ricci added the partnership will add “meaningful, verified and documented steps” in cutting emissions for IADA’s clients.

In its first year, 4AIR helped the business aviation industry to offset more than 1m metric tons of CO2, as well as facilitating more than 250,000 carbon-neutral flight hours and offsetting more than 80,000 emissions-neutral flight hours.

Ricci appeared in Corporate Jet Investor’s (CJI’s) Guide to Sustainable Business Aviation 2022, where he spoke about regulatory controls imposed by governments, meeting carbon neutral by 2050 pledges and advanced technology and its role in cutting carbon. 

CJI visited Neste’s refinery in Rotterdam last week to explore how sustainable aviation fuel (SAF) is made, and how it can help the industry cut its carbon emissions.

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You pass several refineries, power stations and other industrial complexes before you get to Neste. But it is worth it. There is no way that business aviation can meet future carbon targets without Sustainable Aviation Fuel (SAF). You also get to wear cool protective gear and carry an emergency gas mask as part of the tour.

Neste is the world’s largest producer of SAF. It doesn’t use any crops to do this. It just takes used cooking oil (including from McDonald’s in the Netherlands) and left-over fats from abattoirs (the bits that have not made it into sausages). It turns these into Jet A. A sign in its head office says: “Why waste, perfectly good waste.” SAF reduces greenhouse gas emissions by about 80% compared with traditional crude oil.

First, the technical part. Making SAF from waste involves thousands of miles of pipes of all different sizes, huge towers, hydrogen, catalysts and a cool control room. It also takes serious investment.

Neste makes all its SAF in Finland now. Next year it will open refineries in Rotterdam (we saw the construction of this) and Singapore. “SAF is not just on paper, it is happening. It is real,” says Jonathan Wood, vice president Europe, Renewable Aviation at Neste.

Victor is working on demand. In June it announced an agreement where customers could buy SAF from Neste for their booking. Since June, one fifth of customers have chosen to use SAF.

“A lot of people say that there is not the demand, but there is,” says Toby Edwards, co-CEO, Victor. “We have shown this and would love to help others in the industry. We have proved that customers will choose SAF.”

Customers get to choose what proportion of their booking is covered by SAF and on average have chosen about a third of their fuel burn. Rather than physically fill the exact same aircraft, Neste delivers the fuel to a partner airline which uses it. Victor’s customers get an audited SAF delivery certificate. It calls this: “Pay here, use there.”

Neste will produce 100,000t of SAF in 2022. In 2023 – when production starts in Rotterdam and Singapore – production capacity will rise to 1.5m tons. By 2026, Neste capacity will be 2.2m tons. The EU and UK are targeting to mandate that 2% of all aviation fuel in Europe should be from SAF by 2025 and 5% in 2030. Neste can do this on its own.

“There is a lot of focus on mandates, but voluntary demand can get the industry to net zero much faster, now,” says Wood. “Everyone has seen recent protests at airports, being sustainable is becoming a licence to operate.”

By 2025 there will be a lot more supply. World Energy, the leading US producer, is investing $4bn to increase its SAF production to over 500m gallons by 2025 and 1bn gallons by 2030. Shell is also building a SAF facility in Rotterdam that should open in 2024.

A quarter of Neste’s staff work in research and development and they are always looking at new feedstocks like municipal waste. In the next 10 years the Rotterdam facility will probably be using 10 different feedstocks. In the US Alder Fuels is working on forest waste. The ultimate goal is converting carbon dioxide in the atmosphere into fuel. Kiverdi, a fascinating start-up, says it can get bacteria to do this.

“The key thing is that fossil fuels stay underground,” says Edwards.

Cooking oil and fats are key for now. So, when someone says: “Would you like fries with that?” For the love of business aviation, say yes.

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Inside, there was heat too, but this was confined to descriptions of the high-demand market for private jets. The key themes running through the 28 different sessions all touched on strong demand, supply chain issues and talent shortages, sustainability and a new influx of capital coming into the industry.

While everyone expects the US economy to worsen, almost all delegates were confident there will be no big fall in the next 12 months at least, with 33% of attendees very optimistic and 66% fairly optimistic. Brokers, too, were confident demand will remain strong into 2023.

Bankers shared their cautious optimism, with business expected to stay strong over the next year. “Senior executives do anticipate some level of recession, but the number one takeaway is that the banks are still open for business,” said Keith Hayes, senior vice president of PNC Aviation Finance. He added: “We’re not in fear of recession, we’re lending very prudently and we’re still doing business.”Global Jet Capital’s CEO Vivek Kaushal agreed:“We’re doing probably 50% more volume this year than we did last year, so we’re still very much in business.”

Another reason for optimism was OEMs’ strict supply chain management – aided by supply chain disruptions. However, keeping up with the demand was a worry for many. Maintenance was a particular concern. Speaking about backlogs in the sector, Christopher Jordan, Operations director, Global Engine Service Sales, Honeywell said: “Have you ever played whackamole? That’s what it’s like right now. It’s triage.”

Hiring (and keeping) the right people also dominated lots of conversations. Many attributed this to the industry’s image and commercial airlines’ polished recruitment campaigns. “Let’s be honest, we’re getting our tails kicked by the airlines,” said Andy Priester, chairman and CEO, Priester Aviation. “That’s where [the students’] mentality is. As an industry, we need to figure out how to engage and recruit people to get them involved in our organisations at the high school and university levels. If we do it together, we’re going to be able to make a difference, if we all do it separately it’s going to be really hard to fix.”

FAA staff shortages are also delaying some jet sales. Chris Rocheleau, chief operating officer, NBAA said the challenge is that companies in business aviation are “trying to move at the speed of Silicon Valley versus moving at the speed of government”. He said: “There’s always a little bit more work to do than there is the time and resources to do it, and the FAA faces the same challenges.

“As you have a lot of people rotating in the senior positions, it’s challenging for the agency to pick a path, there’s a lot of competing interests. Permanent leadership in a direction that’s important to the industry is going to make a difference.”

Sustainability offered both a challenge and an opportunity. While it remains the focus of industry criticism, Eve Laurier, vice president of Communications, Marketing and Public Affairs, Bombardier said it could be key to recruiting more talent. The same young people who are critical of aviation could be attracted by the promised opportunities to make it more sustainable. “They can test the solutions[to sustainability]with us. They can’t test them with commercial aviation”, she said.  

More than half (58%) of the 500 delegates thought the industry has seen a permanent shift in demand. The remaining 42% thought the industry was experiencing cyclical changes. So, even if demand dips in the short term, it will come back around.

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