Breaking News
Investing Pro 0
🚨 Our Pro Data Reveals the True Winner of Earnings Season Access Data

Airlines get ready for jet biofuel take-off in Norway

Stock Markets Nov 21, 2019 10:21AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

By Lefteris Karagiannopoulos

OSLO (Reuters) - Airlines are confident of having sufficient supplies of biofuel-infused jet fuel to comply with a Norway requirement which takes effect next year, although they warn of additional costs.

From January, jet fuel suppliers in Norway must blend 0.5% of biofuel in all their aviation fuel, a policy Oslo hopes will boost supply and demand and lead to lower CO2 emissions.

Although aviation biofuel suppliers say it can cut the carbon footprint of airlines by up to 80%, it costs four times as much as normal jet fuel, which has so far curtailed usage and therefore demand for increased production.

And not all biofuels are equal when it comes to their environmental impact, both in production and transportation.

Norway's new rule demands that airplanes refueled in the country use a product made from waste fats and vegetable oil, although it excludes palm oil.

"There are not that many suppliers that supply that type of fuel. We have access and can buy these quantities at this stage. As we go into the future though we need more," Rickard Gustafson, chief executive of SAS, told Reuters.

The Scandinavian airline has set its own goal of powering all its domestic flights, which account for 17% of its total fuel consumption, with biofuel by 2030.

SAS expects Norway's 0.5% biofuel requirement to mean an additional 3 million euro ($3.33 million) in annual fuel costs.

It said it may source the biofuel it needs from AirBP, BP's specialist aviation division, and intends to buy more from Sweden's Preem, which is building new facilities.

But with Sweden and Finland considering following Norway's lead -- all three say that by 2030 they want to increase aviation biofuel use to 30% of total refueling -- there is a danger that demand will outstrip production.

"We have to create the market. There is strong demand for biofuel. But not enough is produced," Norway's Climate and Environment Minister, Ola Elvestuen, told Reuters.

Neste and Norwegian utility Statkraft [STATKF.UL] are also developing new plants, while similar projects have been announced by Air France KLM and AirBP.

Wideroe, a small Norwegian airline, welcomes Norway's requirement but called for other countries to follow suit.

"As a first step we would like to see national requirements of biofuel being replaced by international requirements. This would ensure a level playing field between airlines," it said, adding that it wants to use electric planes by 2030.

However, budget airline Norwegian Air said Norway was creating artificial demand which, even though it can be met initially, could cause a future fuel squeeze.

"With other (biofuel) volume obligations in the future, we could easily get a supply shortage," a spokeswoman said.

"In order to fulfil the mandate, imports from other regions might be necessary. How sustainable is biofuel that has been shipped half way around the world," she said.

Norwegian Air has been investing in more fuel efficient planes, which should be encouraged instead, she added.

Some in the airline industry market, including the SAS CEO, said some of the extra fuel costs may be added to fares.

Despite this, passengers at Oslo airport welcomed Norway's pioneering move.

"I do not mind if it will cost a little bit more. We have to clean up the world and do what we can do to have cleaner fuel," said 72-year-old Dag Christopherson.

Airlines get ready for jet biofuel take-off in Norway

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your profile, will be public on and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Andrew carson
Andrew carson Nov 21, 2019 3:35PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Not exactly jet fuel I'm betting. No thanks.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email