It was great to be able to meet industry colleagues face-to-face again earlier this month at IATA’s Aviation Fuel Forum in Geneva, Switzerland. Our team from FuelPlus and Airpas attended in person, including FuelPlus CEO, Klaus-Peter Warnke, who spoke at the event as part of a workshop on Digitalization. We heard plenty of thought-provoking talks by aviation leaders and wanted to share four key messages we took away from the event.
One of the first sessions we attended on the Tuesday, was ‘Efficiently managing the fuel supply chain in volatile times’ with contributions from Puma Energy, Delta Air Lines, FSM Group and Skytanking.
Each discussed the current challenges with aviation fuel supplies from their perspective and suggested some ways to resolve these. They covered issues such as:
• The poor allocation for jet fuel within pipelines due to low average demand over the preceding 12 months
• The pressure on suppliers to adapt to new conditions due to the pandemic
• The need to get fuel to increasingly remote locations
• Issues with fuel quality due to lack of flow in fuel tanks and the requirement to perform fuel quality maintenance.
These challenges, coupled with the recent surge in flying thanks to the success of Covid-19 vaccination programmes, means there is now significant pressure on jet fuel supplies.
When it came to suggesting what airlines could do to help mitigate these issues, Kelly Nodzak from Delta Air Lines answered best with: “communication.” Airlines need to provide timely communications to suppliers, particularly when there is a change to planned fuel supply, and of course their fuel forecasts need to be as accurate as possible.
In his Thursday morning session ‘IATA AGM Resolution on Net Zero’, Sebastian Mikosz from IATA updated us on progress towards the Net Zero by 2050 plan, and what lies ahead. One eye-catching statistic was that 65% of our industry’s carbon reduction will come from the transition to Sustainable Aviation Fuel (SAF).
As the following slide shows, the reliance on SAF means that production of this new fuel needs to increase rapidly — by 449,000% in the next 29 years. This is clearly a tall order and one that will require a huge collective effort.
As the next big challenge for the industry, SAF featured in most sessions at the Aviation Fuel Forum. In ‘Aviation fuel logistics 101’ for instance, the speakers covered some other key barriers which need to be overcome for SAF to be more widely used, particularly the need for infrastructure adaptations so that SAF can be mixed with normal jet fuel before being transported to airports.
This requirement to blend SAF with regular jet fuel will also have an impact on fuel management processes and fuel data standards, as was highlighted in the Digitalization Workshop on Thursday. The session raised issues such as these:
• SAF fuel tenders will be more complex because airlines will be negotiating on two types of fuel at the same time
• Emissions calculations will depend on the percentage of SAF and of jet fuel within the blend, so fuel tickets will need to be able to specify this
• No-one yet knows how many different types of SAF there will be, which makes it hard to classify it as a product in fuel management systems
• SAF will require different pricing formulas within fuel management systems.
The Digitalization Workshop on Thursday featured insights from FuelPlus’ own Klaus-Peter Warnke, as well as representatives from Lufthansa, ebits, and QT Technologies.
It was a reminder that despite the difficulties faced by airlines during the last two years, it was essential to invest in automation technology to improve operational efficiency. Chris Lenglain from QT Technologies gave a good example of why. He talked about the unseen costs of manual systems and outlined a scenario where an into-plane agent at a remote location in Alaska, fills in a paper fuel ticket while it’s snowing, which begins to get wet. This is then given to the pilot who, several days later, hands it to someone in the back office. By the time it reaches the person who needs to input the data, it is illegible. They now need to phone up the IPL agent and ask them to check the details, and so the saga continues.
The point is that digital processes could have ensured that fuel uplift data was inputted into an airline’s IT system within a matter of minutes, but with a more manual, paper-based process this could take over a week or more. Chris suggested that because of scenarios like these, the “savings [of digitalization] are much higher than the costs.”
The speakers also reiterated the importance of IATA’s fuel data standards because these provide a common language and make communication between systems easier. They also prevent the risk of airlines being locked in to one vendor. The panel acknowledged that the fuel data standards will regularly need updating as the industry and technologies change. For example, there were issues around the legality of electronic signatures, which have now been resolved. The next challenge is to make the standards work for SAF.
The panel also addressed some of the major objections they hear from airline teams in relation to digitalization, and made the following points:
• Standards are here to replace paper, not people
• Technology is here to ease the complexities of your job, not add to them.
Here at FuelPlus and Airpas, we already have — or have started to develop — features in our fuel management platform that address some of the industry challenges covered in this blog. For example:
• We’ve implemented a tool that enables airlines to automatically notify suppliers when there are fuel supply changes (Automated Fuel Authorization), which helps ensure timely communication
• We leverage IATA’s fuel data standards to enable paperless communication between airlines and suppliers for fuel tenders, tickets and invoices
• We’ve started to work on new developments that will make tracing SAF through your fuel management process, much easier.
Contact us today to arrange a demo of our platform or to find out more.