Biofuels: Australian Canola’s Place in the Sustainable Aviation Space

From the board room to the kitchen table, sustainability has become one of, if not the most discussed topics throughout Australia. Sustainability covers a broad range of issues which is why the term environmental and social governance has been so prevalent. Society now expects government and business to initiate policy structures which lead to better environmental outcomes. As a result, the biofuel industry worldwide has seen increased demand and new markets are opening for sustainable feedstocks.

As we set our sights towards the Australian Government’s 2030 and 2050 sustainability goals, coupled with recent legislation in the aviation sector, demand for biofuels and their associated feedstocks is predicted to increase. Herein lies the opportunity for Australian farmers.

Biofuels are a renewable fuels made predominantly from used cooking oil, tallow and vegetable oils. They are drop-in fuels  which have the potential to reduce greenhouse gas emissions from vehicles by up to 65%. For the aviation industry these fuels can be used in existing aircraft without any modifications to their engines or refueling infrastructure. Due to a shortage in used cooking oils and tallow, land use change impacts on soybeans and the phase out of palm oil by 2030, Australian canola has the potential to support a surge in biofuel production which the aviation industry hopes will lead to increased production of sustainable aviation fuel.

As of 2024, over 70% of Australian canola is being exported to the European Union for conversion into biofuels. Whilst this provides a secure market going forward for Australian farmers, it leaves them susceptible to macro factors, logistics, freight and competition. The benefit of biofuels could be multiplied by the development of a sustainable aviation fuel industry domestically, assisting in decarbonising the aviation sector, providing protein for the domestic livestock market, secure fuel sovereignty and increase job opportunities for those unemployed by the current slowdown in critical minerals. 

It is evident that production of SAF through the HEFA pathway is the most cost-effective, mature and immediately scalable technology available to decarbonise the aviation industry. Due to the HEFA pathway being similar to traditional fossil fuel refining, Australia has retired refining assets which could be converted to refine canola oil at much lower CAPEX expenditure than a greenfield facility. By aligning its efforts with global sustainability goals and leveraging its expertise in canola production, Australia is poised to shape a greener future for aviation and establish itself as a prominent player in the sustainable biofuel sector.