Brazil's aviation industry will bet on sustainable aviation fuel (SAF) to help it meet mandatory greenhouse gas (GHG) reductions starting in 2027 despite limited investments in the domestic market.
SAF production in Brazil is still limited to tests and is not yet available for commercial purposes, but the federal government is encouraging investments in this segment through infrastructure and legal incentives. Brazil's mines and energy ministry (MME) intends to use SAF to satisfy both domestic demand and exports.
Brazil's fuels of the future law requires the aviation sector to reduce GHG emissions in domestic flights by at least 1pc by 2027 and by up to 10pc by 2037. It prompts higher mandatory biofuel blends in road transportation — despite a freeze in the biodiesel mandate hike last week — and sets sustainability goals for aerial and marine modals.
National energy policy council CNPE is responsible for establishing minimal GHG reduction goals for the transport industry. But those for airlines are flexible according to their biofuel supply and possible negative impacts on the sector, such as higher operation costs halting competitiveness or preventing them from acquiring the biofuel. For example, airlines without access to SAF in airports are exempt from minimum reduction goals.
Civil aviation agency Anac expects SAF regulation alongside public policies to increase supply and support the airline industry's interest in reducing GHG emissions. MME estimates SAF and green diesel investments of R17.5bn ($3.06bn) from 2025-2034, as well as R260bn for biofuels to neutralize 705mn metric tonnes (t) of CO2 by 2037, as announced at a World Economic Forum meeting in Davos.
As investors seek stability and long-term goals, fuels of the future allows for innovative solutions with alternative feedstocks for commercially viable SAF production, Anac's deputy director Roberto Honorato said.
The new SAF industry in Brazil is working on production from soybean oil, palm oil, ethanol — known as the alcohol-to-jet route — and macaw palm oil.
Macaw bet
Acelen, a subsidiary of Abu Dhabi's Mubadala, plans to produce its first "SAF drops" from macaw oil in December 2027-January 2028, trading vice-president Cristiano da Costa said.
The company, which owns macaw fields in the states of Bahia and Minas Gerais, will work with other feedstocks to meet demand as it waits for the macaw to grow, he added.
There are some competitive advantages in producing SAF from macaw, as it yields 7-10 liters/hectare of oil, seven times more than soybeans. Macaw also has the advantage of not competing with food, but it is used by the pharmaceutical industry.
Macaw palm trees grow on degraded cropland, such as the tropical savanna biome known as Cerrado, which covers a quarter of Brazil. Acelen will build an innovation center in Montes Claros city, in Minas Gerais, to produce up to 20,000 b/d of SAF — using hydrotreated esters and fatty acids (HEFA) as feedstock — and renewable diesel from macaw. The plants' production will be able to allocate volumes to international markets, according to da Costa.
Macaw palm trees take 3-5 years to fruit and the harvest usually take place in October-January. Acelen is studying ways to extend the harvest until March, agribusiness director Victor Barra said. The company's project is also considering continuous macaw oil supply through a storage and processing structure that would allow biofuel production to last all year long.
