The Qantas Airways Ltd (ASX: QAN) share price is lifting today even as the S&P/ASX 200 Index (ASX: XJO) is down 0.66%.
Qantas shares closed yesterday at $4.91 and are currently trading for $4.95 apiece. That puts the Qantas share price up 0.82% at the time of writing.
The airline could be getting a boost today from the overnight drop in crude oil prices. Brent crude is down 5.1% since this time yesterday, currently trading for US$106.90 per barrel.
Jet fuel costs count among airlines' biggest single expenditures.
That's today's early price action.
Below we look at Qantas' latest deal to reduce its carbon footprint by increasing the amount of sustainable aviation fuel (SAF) used in its aircraft.
How is Qantas reducing its emissions?
In a move unlikely to be impacting the Qantas share price directly today, the airline reported it is increasing its use of SAF on its Los Angeles and San Francisco to Australia routes.
According to the release, aircraft fuelled with SAF produce 80% less carbon emissions than those using standard jet fuel. SAF can be used in existing aircraft without modifications.
The SAF will be supplied by United States biofuels company Aemetis. Aemetis will supply some 20 million litres of blended SAF to Qantas per year, commencing in 2025.
Alan Joyce, Qantas CEO, met with Aemetis top brass in LA.
According to Joyce:
Climate change is front of mind for Qantas, our customers, employees and investors, and it is a key focus for us as we move through our recovery from the pandemic. Operating our aircraft with sustainable aviation fuel is the single biggest thing we can do to directly reduce our emissions.
We're actively looking to source sustainable aviation fuel for our operations, and the deal we're announcing today is hopefully one of many we'll make as the market catches up to demand globally.
As for costs, Joyce said SAF remains more expensive than standard jet fuel. "But with the right investment it could grow to a scale where the cost is on par," he added.
The deal with Aemetis represents Qantas' second major offshore purchase of SAF. The airline's flights from London began using the more sustainable fuel early in 2022.
Qantas share price snapshot
With today's move higher, the Qantas share price is down 3.8% in 2022. That's a fair bit better than the 6.5% year-to-date loss posted by the ASX 200.
Qantas shares are also down around 10% over the past 12 months and 5% over the past month.
