Air New Zealand said it has signed its largest deal for the supply of sustainable aviation fuel (SAF) with Neste.

It said that it inked an agreement for nine million litres of neat Neste MY Sustainable Aviation FuelTM.

The announcement said, "The deal represents the largest purchase of SAF from Neste by any airline outside North America and Europe for delivery before the end of 2024.

Produced at Neste's Singapore refinery, which expanded its SAF production capability last year, the nine million litres of SAF will be blended with conventional jet fuel to meet the required specifications and supplied to Los Angeles International Airport between April 1 and November 30, 2024.

The SAF is expected to reduce carbon emissions by up to 80%* over the fuel's life cycle compared to using fossil jet fuel, which includes its production and transport emissions.

"Decarbonising Air New Zealand's operations is essential for the airline's long-term ability to connect New Zealanders to the world and support the country’s trade and tourism sectors, and SAF is a key enabler of this," said Dame Therese Walsh, chair of Air New Zealand.

"Sustainable aviation fuel is currently the only solution to significantly reduce emissions from long haul flight, but it currently makes up less than 1% of the global fuel supply. For aviation to reach its net zero carbon emissions goals by 2050, the SAF industry will need to scale significantly."

She added that while the SAF supply is small compared with the airline's overall fuel use, it is nine times the size of Air New Zealand's first shipment of SAF from Neste in 2022 and demonstrates growing cooperation between two like-minded organisations to advance the supply and use of SAF. 

Alexander Kueper, Vice President of Renewable Aviation at Neste, says Neste is fully committed to supporting the decarbonisation of aviation and is working closely with partners like Air New Zealand to accelerate SAF usage.

"We are proud to support Air New Zealand's decarbonisation focus and are looking forward to continuing working together with Air New Zealand and the New Zealand Government to reach their climate goals," he said.