International Airlines Group (IAG) announced its biggest sustainable aviation fuel purchase agreement in company history Wednesday, agreeing to a 14-year contract with Twelve to produce 260 million gallons of e-SAF, which is derived from renewable energy.
Luis Gallego, CEO of IAG, said the global shortage of sustainable fuel remains an industry-wide problem. He called Twelve “an important part of the solution.”
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“We have a roadmap to achieve net zero by 2050 including a target to fly with 10% sustainable aviation fuel by 2030,” said Gallego. “This new deal will contribute towards our 2030 SAF target. We would like to see similar projects scale in Europe, and we look forward to working with governments across our key markets to build a SAF industry to deliver jobs, economic growth and a stable supply of SAF.”
As a result of the contract, IAG has secured a third of its needed SAF to reach its 2030 goal.
Under the agreement’s decade-plus terms, Twelve will supply enough e-SAF to power five European airlines: British Airways, Aer Lingus, Iberia, LEVEL and Vueling. The contracted fuel is expected to reduce life cycle greenhouse gas emissions up to 90% compared with traditional jet fuel.
IAG identified itself as the first European airline group to publicly share it has an e-SAF deal. The agreement should also give IAG the ability to ramp up its SAF use.
Nicholas Flanders, co-founder and CEO of Twelve, said the company is proud to partner with IAG on what he called a “historic deal.”
“Our power-to-liquid E-Jet fuel offers industry-leading emissions reduction potential with the added benefits of an abundant feedstock supply and significantly smaller land and water footprints compared to alternative SAF pathways,” said Flanders.
Implementing conventional fuel alternatives isn’t the only measure IAG has taken in an effort to prioritize sustainability. In August, IAG paired up with Microsoft to purchase a large amount of SAF. And the company said it has also invested in new aircrafts, incorporating fuel efficiency initiatives and working to advance carbon removal to help battle residual operations emissions.
The airline community has long been discussing the use of SAF and its role in the industry’s sustainability journey. In 2022, Alexander Kuper, director of fuel for IATA, said the community was committed to reach net zero by 2050. He suggested SAF would play a key role in reaching that goal, saying he expected that by 2038 the SAF in use will outpace the use of normal aviation fuel.
