Virgin Atlantic vies with British Airways to be greenest transatlantic carrier with low carbon fuel deal

Sir Richard Branson’s Virgin Atlantic is to follow rival airline British Airways in adopting new lower-carbon jet fuel, as parent Virgin Group partners with chemical company Agilyx to develop the technology.

Virgin and Agilyx are establishing a joint venture to build waste-to-fuel production facilities that will create a synthetic crude oil made from discarded plastic that would have otherwise be sent to landfill.

Virgin Group hopes to market the new fuel across the aviation industry, with Virgin Atlantic touted as one of the first adopters.

The move is part of Virgin Group’s plans to become net-zero by 2050.

Transatlantic operators are looking to burnish their green credentials. Virgin’s announcement follows a deal struck by British Airways owner IAG with tech start-up Velocys in November, under which Velocys turn waste woody biomass into sustainable aviation fuel (SAF) at a biorefinery in Mississippi. IAG has agreed to purchase 73 million gallons of SAF over 10 years from 2026. US airliner Southwest Airlines has also signed an agreement to buy 219 million gallons of the fuel.

In a separate announcement today, Singapore Airlines signed a joint declaration on SAF with Airbus, Rolls-Royce and Safran in a bid to meet Paris Agreement targets.

The aviation industry is responsible for about 2.5% of all carbon emissions, figures from Our World in Data suggest. Airline trade association IATA believes as much as 65% of carbon emissions in the aviation industry can be abated through the use of sustainable fuels.

IATA expects only 5.2% of fuel used in aviation to be sustainable by 2030, rising to 65% by 2050.

In an interview with CNBC on Friday, IATA chairman and former British Airways boss Willie Walsh said: “I think quantity is the main issue at the moment.”

“We used about 100 million litres of sustainable aviation fuel in 2021 — that’s a very small amount compared to the total fuel required.”