Report on recent research activities of JTTRI(1) Pathways towards decarbonizationin Japan’s Aviation Sector[group research program](2) Analysis of Airline Strategies in ASEAN[Transport Policy Colloquium]

FUJISAKI Koichi,
Distinguished Research Fellow and Director General for Research
Japan Transport and Tourism Research Institute (JTTRI) 1

(1) Pathways towards decarbonizationin Japan’s Aviation Sector[JTTRI’s group research program
FY 2020-2022]

2

Introduction (Background of the Research)
ICAO’s Global Aspirational Goals (Oct. 2022)
 Until 2035, No increase ofCO2 emissions frominternational aviation from 85%of CO2 emissions in 2019
 By 2050, Achieving Carbon
Neutrality

2019 level-15%
CORSIA Baseline
85% of 2019 levels

Carbon Neutrality
by 2050• Is it Possible for Japan’s Aviation Sector to achieve ICAO’s Goals?
• What is the potential for reducing and offsetting CO2 emissions in Japan by;
 Introduction of new aviation technologies
 Operational improvements
 Leveraging of SAF
 Carbon credit• If these potentials are not enough, what additional efforts are required to close the gaps andensure that targets are achieved?
3Potential Long-Term CO2 emissions from Japan’sAviation Sector
Estimation of Potential of Domestic SAF Production
1,400（参考）1,315(Ref.) 1,315*(Ref.) 1,315*（参考）1,315
 Investigation of the quantity of
1,200
984 to984～
feedstock and their current
1,085
1,085
1,000
usage in Japan
706
800
 Estimation of the potential
600
production volume based on
400
three different fuel scenarios,
200
the availability of feedstock※* Jet fuel supply volume in Japan (2019)(Ref.) 1,315*※（参考）1,315
CO2・水素CO
1,313
2 & hydrogen
産業廃棄物

Industrial waste
一般廃棄物 waste
General万kL/年
Ten ThousandkL/Yr.

※0Accumulation
原料別積上げbymaterial

Accumulation
by raw
原料別積上げmaterial

主産物（糖料作物）
Mainproduct (Sugar crops)
建設発生木材Wastewood
generatedfrom
製材残渣 residue
Lumberconstruction
森林残渣 residue
Forest
農業残渣
Agricultural residue
主産物（油糧作物）
Main product (Oil crops)

Accumulation
原料別積上げbyraw material

廃棄油脂 oils/fats
Waste

F3
F1
F2
Accumulation of SAF production potential in Japan by raw material

Simulation analysis of Long-Term CO2 emissions from Japan’s Aviation Sector

 Based on 9 different scenarios that consider levels of ambition for aviation technology and SAF supply,
simulations were carried out to determine the potential reduction in GHG emission
T3-F3
Transition of SAF in CO2 emissions scenario in the left
Results of Simulation of CO2 emissions
Domestic supply

Overseas supply

4

Scenarios for Estimating Potential Reduction and Residualof CO2 Emissions
3 Technology scenarios × 1 Operation Scenario × 3 Fuel scenarios＝ ９ scenarios
Aviation-Technology

Operation-Technology

Fuel

T1

Advanced Tube andWing

F1

Conservative

T2

Advanced Concept
Aircraft

F2

MediumT3

Advanced Concept
Aircraft (E- orHydrogen Aircraft)

F3

Ambitious

O3

Ambitious

Based on 9 different scenarios, simulations on the following three items
were carried out to determine the potential reduction in GHG emission:- Amount of CO2 emissions and residual- CO2 residual compared to Business as usual (BAU)- CO2 residual compared to 2019 level (%)
5

Estimated Residual CO2 Emissions by Scenarios
CO2 emissions in 2030 exceed 85% of 2019 levels in all scenarios.
In 2035, only scenarios with F3 can achieve the target.
Exceed 85% of2019 levels
BAU

F3scenarios

6

Roadmaps & Challenges towards 2050 Carbon Neutrality

Issues to be resolved for securing future SAF in Japan

 In order to secure SAF in Japan, it is important to align with the F3 Scenario, which introduces SAF-DAC by 2030 andLH2 by 2035. To achieve this, It is important to establish a clear direction for these new fuels and take advanced action
 Key issues to be resolved : Securing feedstocks for advanced SAF such as Hydrogen and renewable CO2, analyzing
the supply of Renewable energy and feedstocks, including demand competition among industries, estimating costs anddesigning markets, conducting R&D on technologies to reduce costs, building infrastructure for the supply chain,and establishing legal frameworks and standards for new fuels.

7Conclusion
 For SAF, the amount of domestically produced SAF based on Japan’s potential to procure
raw materials has been quantitatively demonstrated.
 For Long-term CO2 reduction goals, simulations were conducted for 9 different scenarios thatconsidered the levels of ambition for aviation technology and SAF supply, as the simulations
were made of the potential reduction of GHG emissions. 2 scenarios were presented as thepreferred options for Japan to achieve ICAO’s short-, Mid-and Long-Term Goals
 With a cognizance of long-term reduction scenarios, as well as the description of short to midterm challenges and strategies, a summary was provided regarding the medium to long-term
barriers to achieving carbon neutrality by 2050 in the aviation sector in Japan and thedirection of countermeasures.

This research indicated an urgent need to establish a domestic SAF
supply chain and necessary measures for that purpose, and cultivatedstakeholders’ recognition of this matter and cross sector collaborations.
MOEMLIT

METI

MAFF

Cross Sector CollaborationsAirports
Airlines

Fuel Suppliers

Institutes

8(2) Extracts from Discussions
at the 154th Transport Policy Colloquium(March 2023)
ASEAN-India Regional Report:“Analysis of Airline Strategies in ASEAN”

9

- Report by YAMASHITA Yukio, Senior Research Fellow and Senior Director
ASEAN-India Regional Office (AIRO), JTTRI
１． Characteristics of recent strategies of major ASEAN airlines• Tendency to reorganize airlines within a group as part of portfolio strategy• Increase in incidental revenues other than air-passenger revenues andexpansion into lifestyle and other non-aviation businesses• Utilization of customer information and other data obtained from airline
business• Operation in regionwide multiple countries with unified branding• Challenge for recovery from COVID-19 crisis: to secure human resources
and supply volume
２． Insights into the situation in Japanese airlines• Japan also seems to be following the ASEAN trends• Acceptance of online apps, etc., by passengers, which is the case inASEAN, could boost LCCs

10- Comments by HANAOKA Shinya, Professor, Tokyo Institute of Technology
Characteristics of ASEAN LCCs
• Aligned with middle-class needs/Regional size suitable for short-haul routes• Tony Fernandes, CEO of AirAsia, has outstanding management vision• Linkage between regional alliances and regional aviation liberalization
policies
Companies establish LCC joint ventures in countries outside their homebase.
This is because ASEAN Economic Community (AEC), unlike EU,
recognizes only 5th freedom- Comment by coordinator YAMAUCHI Hirotaka, President for Research, JTTRI• Route expansion, including multiple hubs, is also part of ASEAN airlines’
portfolio strategy- Implications for Japanese airlines toward future with recovery from COVID-19• Non-air-passenger revenues and non-aviation businesses are important• Address market in a wider economic area such as APEC rather than East Asia11

Thank you for your attention !