Intricacies of green fuel that airlines cannot ignore

Everyday, a new airline is making foray into biofuels. Somehow many global airlines seem very ambitious about the environmental targets embarked by their controlling body: International Air Transport Association -IATA. To admonish, the climate targets of IATA consist of increasing the fuel efficiency by 1.5 per annum up till CY20, capping net carbon emissions from CY20 and decreasing carbon emissions by 50 percent in CY50 from those of CY05. Environment is one reason for such regulations as airlines contribute drastically to global warming. Besides climatic effects, another reason has attracted the airlines towards biofuels. Following in Europes footsteps, airlines can regulate emissions through a fee and cut back on the hefty carbon tax they incur annually. Alas, it is not as simple as it sounds. Since its just the beginning, the cost to fill the tank with biofuel is high and the premium will not go down until its production is propped up. Oil producing companies will not grab the opportunity because of lower margins in production. Only one German airline has a fully integrated biofuel department, and the airline has just managed to push down the premium to jet fuel from three times to two.The sustainability and cost effectiveness is further challenged by not only the high cost feedstock, vegetable oil, but also expensive recycled fuel plants. Also, the other sources of biofuel like agricultural products as well as the land and water to irrigate them are limited. Opponents of the green fuel emphasise upon the rise in already high food prices if more agricultural land is dedicated to biofuel production. Across the global airline industry, the recent trends show that Asian and American airlines are making use of their own agricultural crops and residues to meet the emission targets, while in the biggest carbon emitting Middle East, the newly discovered natural gas is fueling the airlines new ambitions. Though bigger airlines are actively approaching green fuel policy, commercial viability of this alternate fuel in the long run has its qualms which require cooperation amongst all stakeholders, be it the airlines, the agriculture sector, the international bodies or the government. So far things seem uncertain.