IAG has signed an MoU with sustainable fuels tech firm Velocys to acquire 220,000 tonnes of SAF over ten years.

The sustainable aviation fuel (SAF) covered in this newly announced agreement equates to one third of the planned output of Velocys’ new Bayou Fuels project in the United States when it begins delivery in 2026.

The technology used in this project will capture CO2 from the manufacturing process to permanently remove it from the atmosphere, and the SAF purchased from Velocys will be used by IAG airlines such as British Airways, Aer Lingus and Iberia.

IAG was the first European airline group to commit to powering 10% of its flights with sustainable aviation fuel by 2030. The group will purchase one million tonnes of sustainable jet fuel per year, enabling it to cut its annual emissions by two million tonnes by 2030. This equates to removing one million cars from Europe’s roads each year, according to IAG.

Luis Gallego, IAG´s chief executive, said: “IAG is investing US$400m in the development of sustainable aviation fuel in the next 20 years. This new agreement is another important step towards achieving our goal of 10% sustainable aviation fuel use by 2030.

“Sustainable aviation fuel is a critical element for the decarbonisation of the aviation industry. Clear policy support is needed to attract investment to construct the necessary plants to deliver enough supply for the airline industry. This project has benefitted from strong policy support from the US, creating highly valued green jobs and economic growth. We would encourage the UK and the EU to follow suit in supporting the development and deployment of green technologies including carbon capture.”

Henrik Wareborn, Velocys’ chief executive, said: “This is another step in our long-standing partnership with IAG. Velocys offers an end-to-end technology solution to its clients enabling the production of SAF from waste feedstocks and the integration of carbon capture technology. It´s great to continue working with IAG on its journey to net zero by 2050.”