Air France-KLM has made an investment in DG Fuels to support the completion of the developmental work necessary to reach the Final Investment Decision on DG Fuels’ initial Louisiana-based sustainable aviation fuel (SAF) plant.
- Air France-KLM acquired an option to purchase up to 25 million gallons / 75 000 tons of SAF annually over a multi-year period beginning in 2029. This option comes in addition to the long-term offtake contract announced by Air France-KLM and DG Fuels last year.
- The investment and offtake option represent a further major step by the Group towards achieving its 10% SAF incorporation target by 2030.
The Air France-KLM Group is fully committed to reducing its carbon footprint and aims to be a frontrunner in sustainable aviation. In 2022, the Group was the world’s largest user of SAF, representing 17% of the world’s total production. By comparison, the Group only accounts for 3% of the world’s consumption of conventional kerosene.
In October 2022, Air France-KLM announced an offtake agreement for 600,000 tons of SAF from DG Fuels, to be delivered between 2027 and 2036.
Today, the Group announces a step forward in its cooperation with DG Fuels, with Air France investing USD 4.7 million in the SAF producer. This investment – a first for Air France-KLM – represents a key development in the strengthening of the partnership between the Air France-KLM Group and DG Fuels. It will support the completion of the development work necessary to reach the Final Investment Decision (FID) on DG Fuels’ first sustainable aviation fuel plant, which will be located in Louisiana. This investment confirms the Group’s ambition to participate in the financing of project studies that enable the development of SAF production capabilities worldwide, with the aim of gradually establishing a diversified network able to meet worldwide demand.
In addition to this investment, Air France-KLM has acquired a new option to purchase up to 75,000 tons of SAF per year from DG Fuels (45,000 tons in Maine; 30,000 tons in Louisiana). 45,000 incremental offtake relates to future SAF that will be produced by DG Fuels’ second U.S. production facility (expected to be located in Maine), with deliveries planned to start as early as 2029.
Fully committed to reducing its environmental impact, the Air France-KLM Group aims to reduce its CO2 emissions per passenger/km by 30% by 2030 compared to 2019. Its decarbonisation trajectory factors in the incorporation of a minimum of 10% SAF by 2030, alongside fleet renewal and eco-piloting.
“Air France-KLM welcomes this expanded cooperation with DG Fuels. Supporting the scale-up of advanced waste-to-aviation fuel technology is a crucial step to growing the SAF industry. This is the first time Air France-KLM has made a financial investment in a SAF producer and we look forward to further reinforcing our long-term partnership with DG Fuels.”, said Constance Thio, EVP Human Resources and Sustainability, Air France-KLM.
“We are very pleased to broaden our strategic relationship with Air France-KLM. This expansion of our existing relationship is very important to both DG Fuels and to the aviation industry as we build momentum to successfully implementing our first SAF facility and make major scale up plans thereafter. We look forward to working with Air France-KLM as we deploy our SAF technology at additional locations in the United States, Europe and Asia.”, said Christopher Chaput, President & CFO of DG Fuels.
DG Fuels, SAF provider with an efficient, low-cost production process
As a result of its high efficiency carbon conversion process, DG Fuels maximizes the amount of SAF produced from a fixed amount of biomass. This efficiency, combined with reasonable scale results in attractively low unit production costs, allowing DG Fuels to achieve sustained profitability while still offering airline and other SAF customers prices that are competitive with conventional jet fuel. SAF produced by DG Fuels does not compete with global food supplies in any way. As a testament to its commitment to using renewable power, DG Fuels is a major supporter of wind, solar and other forms of zero carbon power.
Destination Sustainability: Air France-KLM’s sustainability trajectory
Air France-KLM has been committed to environmental and social issues for many years, with all of the Group’s commitments falling under its overall “Destination Sustainability” strategy. This strategy is founded on two major pillars: “people & culture” and “environment”.
With regard to the “people & culture” pillar, the Air France-KLM Group is a socially responsible company that cares for people and cultures by investing in noise pollution reduction, creating a safe and inclusive workplace, and supporting local communities.
Concerning the “environment” pillar, Air France-KLM has developed a decarbonization strategy that aims to reduce its emissions per passenger/kilometer by 30% by 2030 – compared to 2019 levels, the reference year. To reach this target, Air France-KLM is activating all the decarbonization levers at its disposal:
Fleet renewal with new-generation aircraft: Airbus A220s, Airbus A350s, Boeing 787s – are more fuel-efficient, producing up to 25% less CO2 emissions, and with a noise level reduction of 33% on average. By 2028, these aircraft will account for 64% of the Air France-KLM Group fleet, thanks to an annual investment of two billion euros.
Increased use of sustainable aviation fuel (SAF), which reduces CO2 emissions by at least 75% on average over the fuel’s life cycle and does not compete with the food chain. By 2030, the Group aims to incorporate at least 10% SAF on all its flights, and 63% by 2050.
Operational measures: Ground operations, eco-piloting measures and other initiatives made possible by the actions of Air France-KLM crews and ground staff trained in these practices enable an average reduction of 4 to 5% in CO2 emissions.
To find out more: https://sustainabilityreport.airfranceklm.com/
About Air France-KLM
A global player with a strong European base, the Air France-KLM Group’s main areas of business are passenger transport, cargo transport and aeronautical maintenance.
Air France-KLM is a leading airline Group in terms of international traffic on departure from Europe. It offers its customers access to a worldwide network, covering over 310 destinations thanks to Air France, KLM Royal Dutch Airlines and Transavia, mainly from its hubs at Paris-Charles de Gaulle and Amsterdam-Schiphol.
Its Flying Blue frequent flyer programme is one of the leaders in Europe with over 17 million members.
Together with its partners Delta Air Lines and Virgin Atlantic, Air France-KLM operates the largest transatlantic joint venture, with more than 340 daily flights in 2019.
Air France-KLM is also a member of the SkyTeam, the alliance dedicated to providing passengers with a more seamless travel experience at every step of their journey 18 member airlines working together across an extensive global network.
Recognized for 18 years as an industry leader in sustainable development, the Air France-KLM Group is determined to accelerate the transition to more sustainable aviation. Since 2003, the Air France-KLM Group has been a member of the United Nations Global Compact. The aim is to make a significant contribution to the UN Sustainable Development Goals in connection with the Group’s activities.
Air France-KLM Press Office
+33 1 41 56 56 00 – [email protected] – @AirFranceKLM – https://airfranceklm.com
About DG Fuels, LLC
DG Fuels is building a program of very low-CO2 life cycle emissions synthetic fuel production facilities based on its patented high carbon conversion technology that is targeting a 97% efficiency. Because this efficiency allows DG Fuels to make more SAF with less biomass, its proprietary technology directly addresses the issue of scale production to meet the environmental requirements of the aviation industry. DG Fuels’ technology does not require the development of new engines or new distribution infrastructure. DG Fuels’ innovative technology matches green hydrogen from proven water electrolysis equipment with biomass carbon derived from timber and agricultural waste via gasification technology. This system creates zero carbon intensity sustainable aviation fuel on a cost-effective basis. DG Fuels delivers a significant value proposition to end-customers, including meaningful environmental benefits and the ability to materially address sustainability goals. Learn more at www.dgfuels.com.
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