![]() This is primarily because of safety concerns associated with using 100% SAF, which are feared to cause issues such as shrinking elastic tank seals leading to fuel leakage. This limits the full potential of carbon reduction that could be achieved through SAF usage. ![]() Assuming the transition will be gradual, and the aviation and energy sectors continue to invest in scaling up production and reducing cost, the impact on airlines is likely to be manageable.ġ00% SAF in Existing Aircrafts Could Save Additional Capital Expenditure Requirements for AirlinesĬurrently, the industry is only permitted to blend its fuel up to 50% SAF. Regulators are also likely to play an important role in determining the pace and cost of decarbonization. Credit implication for airlines will depend on the impact from the higher cost of SAFs on air travel demand and airlines’ margins. Higher cost of the fuel and production bottlenecks are also material challenges, as discussed in further detail below.Īs we discussed in our October 10, 2023, commentary, we believe SAF will play an important role in the airline sector’s strategy to achieve its long-term decarbonization targets. In addition, fuel infrastructure upgrades to accommodate 100% SAF might also be required. Technology questions regarding whether modifications to current SAF properties and/or existing aircraft will be required remain unanswered at this stage. Except as expressly provided under your plan, you are responsible for charges you incur from third parties.Despite this positive development, broad 100% SAF usage at scale will take years as significant hurdles remain. Any Non-Insurance Assistance services purchased are provided through AGA Service Company. Plans include insurance benefits and assistance services. The insured shall not receive any special benefit or advantage due to the affiliation between AGA Service Company and Jefferson Insurance Company. ![]() Allianz Travel Insurance products are distributed by Allianz Global Assistance, the licensed producer and administrator of these plans and an affiliate of Jefferson Insurance Company. Allianz Global Assistance and Allianz Travel Insurance are marks of AGA Service Company dba Allianz Global Assistance or its affiliates. residents and may not be available in all jurisdictions. A+ (Superior) and A (Excellent) are the 2nd and 3rd highest, respectively, of A.M. ![]() 101-C series or 101-P series, depending on your state of residence and plan chosen. 52.201 series or 52.401 series, or Jefferson Insurance Company (NY, Administrative Office: 9950 Mayland Drive, Richmond, VA 23233), rated “A+” (Superior) by A.M. Insurance benefits underwritten by BCS Insurance Company (OH, Administrative Office: 2 Mid America Plaza, Suite 200, Oakbrook Terrace, IL 60181), rated “A” (Excellent) by A.M.
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