The EU Commission published a set of frequently asked questions (FAQs) on the implementation of the EU taxonomy for sustainable economic activities on November 29, 2024. The FAQs are to support stakeholders as the classification system is implemented.
The Commission said the publication will help simplify the agenda and reduce the administrative burden on companies applying the EU sustainable finance framework.
In the EU, sustainable finance supports economic growth while reducing pressures on the environment to help reach the climate and environmental objectives of the European Green Deal, taking into account social and governance aspects. It also covers companies being transparent in risks related to ESG factors that may have an impact on the financial system.
“The EU taxonomy provides investors with a common understanding of the environmental impacts of their investments while guiding companies’ sustainable transition efforts,” said EU commissioner for financial services, financial stability and capital markets union Mairead McGuinness. “Our focus now is to improve the usability of the framework and these FAQs will help companies as they apply the taxonomy.”
The publication covers aviation related FAQs such as methodology for calculating global replacement ratio as well as sustainable aviation fuel (SAF) use requirement and reporting.
“When demonstrating compliance with the minimum share of SAF attributed to the compliant aircraft, aircraft lessors and operators may rely on the amount of taxonomy-eligible SAF purchased and used as reported in the monitoring, reporting and verification (MRV) systems established under the EU emissions trading system (ETS) and ReFuelEU Aviation,” the publication read.
The ReFuelEU Aviation initiative seeks to increase both the demand and supply for SAF in order to meet EU’s climate targets for 2030 and 2050.
The Commission said it is also currently assessing the “feasibility” of extending the Union database for biofuels to cover consumption of SAF by aircraft operators. The agency said this could “facilitate the traceability, purchase, supply, and consumption of SAF.”
The taxonomy also states that from 2028 to the end of 2032, aircraft must be certified as operating on 100% blend of SAF. The publication provided further clarity on this.
“As of 2024 there is no jet fuel quality standard that allows 100% SAF,” the publication read. “The use of 100% SAF on a commercial flight is therefore currently not allowed for safety reasons.” Currently, SAF can be blended with conventional jet fuel to a maximum of 50%.
With no agreement either on the timeline for finalising the 100% SAF requirement, and several OEMs pledging to make aircraft 100% SAF compatible by 2030, the EU taxonomy brought the industry baseline from 2030 down to 2028 to “encourage progress in this area”.
However, the Commission said the 100% rule should be “reviewed regularly” and take into account emerging SAF technologies.