Filling Up: Airline Fuel Management

28 June 2011 (Last Updated June 28th, 2011 18:30)

As global oil reserves start to dwindle, the increasing cost of fuel is putting pressure on the world's airlines. But as Chris Lo finds out, effective fuel management and the development of new alternatives bring hope for a sustainable future, both environmentally and financially.

Filling Up: Airline Fuel Management

Fuel has been one of the overriding issues occupying the aviation industry in the last few years. This preoccupation has been spurred on by two related factors. First, dwindling oil reserves has prompted genuine concerns that producers will soon be unable to meet industry's insatiable demand, leading to ballooning fuel prices.

Many airlines are struggling to keep up with these costs, which can comprise well over a quarter of a carrier's total obligations. In turn, airlines are being forced to lay off employees and drive up prices for customers to maintain decent cash flow. In May 2011, budget operator EasyJet attributed the doubling of its half-year losses to a 40% increase in fuel costs during the period, exacerbated by political tensions in the Middle East and North Africa.

In addition, the concerted push for greater environmental sustainability among commercial airlines (producers of around 2% of the world's total carbon emissions) is driving research into alternative fuels and putting pressure on companies to boost their fuel efficiency. News emerging from this year's Paris Air Show indicates that new commercial aircraft with greater fuel efficiency are driving deals for manufacturers like Airbus and Boeing. Biofuels are also making a splash at the show, with Honeywell completing the world's first transatlantic biofuel flight part-powered by its camelina-based Green Jet Fuel.

The environmental goals of the International Air Transport Association (IATA) include a 25% reduction of fuel consumption and carbon emissions by 2020 compared with 2005 levels. The European Commission, meanwhile, is steadily introducing stricter guidelines on emissions reporting as it prepares to bring the aviation industry under the regulation of the EU's emissions trading scheme from 2012 onwards.

Fuel management: technology and automation

"EasyJet attributed the doubling of its half-year losses to a 40% increase in fuel costs."

These factors have turned fuel management from a simple exercise ensuring consistent supply to a vital practice in maximising efficiency and suppressing costs, involving close co-ordination across different departments. With such a heavy and complex workload, airlines have turned to technology to help create savings and minimise delays related to refuelling errors.

In the endless search for greater efficiency, airlines have made the transition from the labour-intensive manual approach to automated processes driven by supervisory control and data acquisition control systems (SCADA).

Given that a carrier's refuelling operations involve complex networks of reporting, calculating fuel demand and local prices, monitoring inventories and checking fuel consumption against aircraft movements, automated control systems can save time and reduce the considerable potential for human error.

A good example of the shift from manual to automatic is the huge project undertaken by struggling US carrier Northwest Airlines before it merged with Delta Airlines in 2008. The project, which was carried out with fuel automation specialist Varec between 2003 and 2008, replaced the airline's previous paper-based system, in which flight information and fuel load requirements were written down on tickets and handed over to fuel suppliers, with a paperless, automated system.

With Varec's FuelsManager system, flight schedules and fuel load information is displayed at central workstations, allowing for real-time tracking and dispatch of fuel for flights. Handheld wi-fi computers replaced paper tickets, reducing errors by minimising manual entry and automatic updating of information where possible. Varec estimated that the new system saved the stricken airline millions of dollars and dramatically reduced the company's record of delays. Northwest's managing director of fuel management David Zanussi hailed the paperless system as an innovative evolution for the industry.

"Northwest has standardised on Varec's electronic fuel ticketing, as we have seen it change aircraft refuelling and fuels accounting in the same dramatic way e-tickets changed passenger processing," he said.

Search for alternatives: biofuels

As well as driving orders for fuel-efficient new aircraft, the recent environmental considerations and financial constraints of commercial airlines are also pushing forward R&D efforts into developing cleaner, more efficient fuels that rely less on the world's expensive, finite supply of oil.

"Airlines have made the transition from the labour-intensive manual approach to automated processes driven by SCADA."

At the head of the alternative fuel pack are biofuels, which are derived from energy crops like jatropha, algae, camelina and biomass materials.

According to IATA, the use of these fuels could reduce a plane's carbon footprint by 80% over the course of their lifecycle; the association is also predicting that sustainable, second generation biofuels could make up 6% of jet fuel by 2020 if actively pursued.

There have been several major landmarks for jet biofuels in the last few years, perhaps most notably KLM Royal Dutch Airlines' November 2009 test flight of a commercial Boeing 747 with one engine powered by a blend of biofuel and traditional kerosene. The flight was particularly significant as it was the first such test to carry passengers.

"This is technically feasible," said KLM president and CEO Peter Hartmann at the time. "We have demonstrated that it is possible. Government, industry and society at large must now join forces to ensure that we quickly gain access to a continuous supply of biofuel."

Biofuels are continuing to take flight in 2011. On 18 June, US engineering company Honeywell made a splash at the Paris Air Show by arriving in style – on the first plane to complete a transatlantic flight using biofuel. The Honeywell-operated Gulfstream G450 business jet flew from Morristown, New Jersey, to Paris-Le Bourget Airport in around seven hours, with one engine powered by a 50 / 50 mix of traditional fuel and the company's Green Jet Fuel.

Honeywell Green Jet Fuel is derived from camelina, an oil plant that can be harvested sustainably as it grows on marginal land and can be rotated with wheat crops. According to the company's lifecycle analyses, the use of its biofuel on the flight saved around 5.5t of net carbon dioxide emissions, compared with a flight powered entirely by traditional fuel.

While the flight only powered one of the plane's engines and full adoption of biofuels by the aviation industry is still only a speck on the horizon, Honeywell's vice-president and general manager of renewable energy and chemicals Jim Rekoske trumpeted the flight as another positive step towards a future that is both greener and more cost-effective, and no longer bound to the unpredictable fluctuations of the oil market.

"Honeywell Green Jet Fuel is derived from camelina, an oil plant that can be harvested sustainably."

"This first biofuel trip across the Atlantic, along with a dozen other commercial and military test flights, demonstrates that Honeywell Green Jet Fuel more than meets the demanding requirements for air travel," he said. "Now that the initial ASTM International approval is in place, we are one step closer to commercial use that will help the aviation community reduce its carbon footprint and dependence on crude."

So while fuel prices and harsh market forces are making the aviation industry sweat for the moment, there is light at the end of the tunnel.

In the short-term, leveraging technology to automate and streamline the fuel management process is a good way of offsetting the cost of fuel. In the longer term, the introduction of sustainable biofuels could herald a new era of sustainability, stability and cost-effectiveness for airlines and travellers alike.