Air Canada, Airbus pledge up to $13.7M to help grow Canada's SAF industry

Air Canada and Airbus are teaming up to help accelerate the development of sustainable aviation fuel (SAF) in Canada, announcing plans to jointly invest up to approximately $13.7 million (CAD) in support of domestic production.

The companies on Monday (July 20) unveiled their intention to create a jointly funded Sustainability Co-Investment Platform, a move they say is designed to help advance commercial-scale SAF production in Canada while supporting the aviation industry's long-term decarbonization goals.

The investment will focus on helping move an agreed-upon Canadian SAF project toward a Final Investment Decision (FID), with both companies saying they hope the initiative will act as a catalyst for broader industry investment.

Air Canada and Airbus stressed, however, that scaling SAF production will also require support from federal and provincial governments through policies that encourage production and improve price competitiveness.

The two companies have been working alongside the Canadian Sustainable Aviation Fuel Coalition (C-SAF) to advocate for measures that would help establish a stronger domestic SAF market.

“Air Canada is proud to help advance aviation’s energy transition in Canada,” said Valerie Durand, VP, airport affairs, corporate real estate and sustainability at Air Canada. “Through this joint initiative with Airbus, we are taking meaningful steps toward supporting domestic SAF production, helping corporate customers address the emissions associated with business travel, and contributing to a lower-carbon path for the industry. With continued industry collaboration and a supportive policy environment, we are confident this momentum can accelerate”

Airbus joins Air Canada's SAF program

Alongside the investment platform, Airbus has signed a five-year agreement to participate in Air Canada's Leave Less Travel Program, which allows corporate customers to purchase the environmental attributes associated with sustainable aviation fuel.

As part of the agreement, Airbus will purchase SAF environmental attributes tied to more than 60,000 litres of sustainable aviation fuel during its initial allocation.

Air Canada said the program tracks greenhouse gas emissions generated by participating companies' business travel and retires verified SAF environmental attributes on their behalf. While the initiative does not directly reduce emissions from flights, it is intended to help stimulate demand for SAF and support the growth of the industry.

The airline noted that renewable fuels complement its broader fleet modernization strategy, which includes more fuel-efficient aircraft such as the Airbus A321XLR and the Canadian-built Airbus A220.

Both companies reiterated their support for the aviation sector's goal of achieving net-zero carbon emissions by 2050, with SAF expected to play a key role.

Economic impact could reach $32 billion

The announcement coincides with a new study by Airbus and consulting firm ICF that highlights the potential economic benefits of building a Canadian SAF industry.

According to the report, producing enough sustainable aviation fuel to meet 40 per cent of Canada's aviation fuel demand by 2040 could contribute $32 billion to Canada's GDP while supporting approximately 140,000 jobs across agriculture, forestry and urban industries.

Air Canada and Airbus say they hope their new investment platform will help lay the groundwork for achieving those long-term economic and environmental benefits.

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