Sasol Climate Change Report 2023 - Book - Page 41
INTRODUCTION
TRANSFORMING FOR RESILIENCE
GOVERNANCE
CLIMATE ADVOCACY AND POLICY
DATA AND ASSURANCE
SASOL ecoFT
Unlocking new FT horizons
FEATURE STORY
SAF is widely acknowledged as an essential lever for decarbonising the aviation sector. Globally, advances are being made to provide the required
enabling policy and regulatory environments to catalyse green hydrogen projects.
Developments:
1
Increased the number of active project studies
to seven.
2
Secured in-principle approval for grant funding
amounting to €350 million with €18 million
formally approved.
3
4
Increased the employment of skilled personnel
more than 70% to 31 positions.
Announced an agreement with Topsoe, subject
to approval by the relevant authorities, to
establish a global JV to pursue low carbon and
SAF equity opportunities.
The European Union is currently setting
standards through its RED and SAF-specific
policies such as the ReFuelEU legislation,
which specifies SAF blending mandates and
penalties for the use of fossil jet fuel. These
standards are serving as benchmarks for early
uptake of more costly (in the short to medium
term), low-carbon fuels and products. Sasol
participates in the European Union, United
States, British, Canadian and International
Civil Aviation Organisation (ICAO) policy
consultation platforms, advocating a level
playing field to allow potential participants
access to the emerging global SAF market.
The ambitious GHG reduction levels set by
the European Union and United States
markets, specifically for decarbonising the
hard-to-abate transport sector, are creating
a favourable environment for Sasol ecoFT9s
mandate and its existing partnerships and
feasibility project studies.
Production costs for sustainable fuels and
chemicals will remain higher as renewable
energy and green hydrogen costs are
expected to remain elevated in the early
phases of the PtL industry. Financing,
therefore, remains critical, with fuel
producers only able to meet future demand
with the help of public and private funding,
as well as by forging smart partnership
strategies across the value chain. As such, the
emerging industry will need to rely on
legislated blending mandates, tax incentives
and grant funding, although country-specific
GHG reduction commitments and regulatory
frameworks are also driving uptake of both
sustainable fuels and chemicals.
Progressing our ecoFT ambition
In 2023, the Business accelerated exploration
of new value opportunities to strengthen its
competitive advantage where Sasol9s
proprietary technology can be leveraged.
Sasol ecoFT established a number of new key
relationships over the year, with players across
the value chain. The Business's focus is on
creating a diversified and resilient portfolio
of SAF asset opportunities in attractive
geographies that have competitive feedstock
offerings and supportive regulatory
dispensations. To this end, feasibility studies
to accelerate the development of SAF asset
opportunities and leverage our proprietary FT
technology are being pursued, as a first step,
in Europe and the United States. Since
inception, Sasol ecoFT has deliberately
focused on pursuing co-ownership models
and partnerships to manage capital demands
and mitigate risk exposure. This, coupled with
grant funding for development and execution
of projects, has positioned the Business well
to deliver on its mandate.
In the United States, a number of new
opportunity assessments have been
prioritised as a direct result of the supportive
regulatory landscape emanating from the
newly implemented Inflation Reduction Act
(IRA). These opportunities include PtL and
biomass PtL FT opportunities, as well as
hydrotreated esters and fatty acids (HEFA)
production pathways.
In 2023, several single-point licence studies
using Sasol9s FT and Topsoe9s hydrocracking
technology solutions were signed with third
parties, with one of the opportunities in
Denmark entering front end engineering
design (FEED).
SASOL CLIMATE CHANGE REPORT 2023
40
SASOL TOPSOE JV
Sasol and Topsoe, a global leader in
emission-reduction technologies,
signed a ground-breaking agreement in
June 2023 to establish a 50/50 JV
(subject to approval by the relevant
authorities), cementing the two
companies’ commitments to produce
SAF for the global community.
The future JV will amplify the individual
companies' technologies, capabilities
and deep industry experience to lay a
combined foundation for industrialscale SAF production facilities.
The purpose of the Sasol Topsoe JV is to
develop, build, own and operate SAF assets and
to market SAF derived primarily from non-fossil
feedstocks, utilising green hydrogen,
sustainable sources of carbon dioxide and/or
biomass with a specific focus on Sasol9s FT and
Topsoe9s technologies.
To complement the JV9s access to technology,
asset development and operating capabilities,
partnerships are being pursued with feedstock
suppliers, technology and service providers, and
long-term customers. These partnerships are
aimed at developing projects in geographies
with favourable policy and regulatory
environments.