Facilitating a Sustainable Aviation Fuel Transition in Italy

Abstract

Civil aviation significantly contributes to “hard-to-abate” emissions, responsible for 2% of global CO2 emissions. This paper examines the most effective policies to promote Sustainable Aviation Fuels (SAFs) in Italy, using a multi-level policy analysis and a stakeholder-based case study approach. The policies reviewed comprise the international, European, and national level. The paper analyses at the international level, ICAO CORSIA and, at the European level, the Renewable Energy Directive (RED), ReFuel EU, and the EU Emissions Trading System (EU ETS) for aviation. Italy has not yet implemented specific policies targeting SAF transition, which is challenging due to commercialization issues and policy inconsistencies. These include the price gap between SAF and conventional fuels, different definitions adopted, and environmental objectives pursued with respect to sustainable fuels by ICAO and the EU. Other challenges include double-counting risks and fuel tankering practices. This article contributes to Italy’s SAF policymaking by developing a stakeholder-based quantitative survey, whose results suggest that three measures are key: tax subsidies for technology and infrastructure users, tax credits for upgrading production infrastructure, and tax breaks for SAF-using companies, fuel handlers, and distributors.