Sustainable Aviation Fuel Bill (Second sitting)

Luke Taylor Excerpts

Committee stage
Tuesday 15th July 2025 Public Bill Committees

[Graeme Downie (Dunfermline and Dollar) (Lab)]

Q This morning, we had a witness say that they did not believe the revenue certainty mechanism was required, that the market would essentially take care of the solution itself, and that the mandate was all that was needed. What is your response to that, and how would it affect your company in particular?

Doug McKiernan: Without this Bill and the mandate and quotas that have been set, I think the investment industry will step back from that, which would hurt us as a company. We would not be able to scale up. It would make things extremely difficult and would push the pace at which we could get to net zero to the right.

[Luke Taylor (Sutton and Cheam) (LD)]

Q You have given a really helpful view of the long-term solution. I do not think many would argue with PtL being the solution for the industry. This question is similar to one I have asked other panel members: how do other parts of Government, other levers and other enablers need to be brought in place to enable you to do what you need to do? What conditions does the Bill need to set? What do you see as the main challenges for the Government to act? You have spoken about skills. What else needs to be done in the Bill to enable you to be successful and for the Bill to achieve what it needs to achieve?

Doug McKiernan: Coming back to the IP, there needs to be some sort of support for e-fuels core technology development. That is very important. If you want e-fuels to be part of the future, we need to make sure that that research is supported in the UK and that when it is supported in the UK there is proper IP regulation of that. That needs to be mandated as part of the support from the Government.

What is happening in the aviation area is clearer cut, because you cannot get the energy density into an aircraft with hydrogen or electric, so it is kind of obvious, but I think it is a solution for a lot of the fossil-based fuels, including gasoline and diesel. I think what we will end up doing is that, if we can develop that core technology, it is then transferable to other sectors, and with that we will be able to deal with the real problem, which is the end-to-end solution of getting renewable energy to the consumer. That is the real challenge.

At the moment, we are talking about sustainable aviation fuel, but actually there is a lot of energy in the North sea that is not getting used because of the challenge of the cost of getting it from there to the consumer. This is where e-fuels come in. The Bill would help to move us in the right direction to start to tackle that problem, because you would have these companies with the new tech working out how to make that viable. There is a very good, well researched paper by the National Renewable Energy Laboratory in the US and the Department of Energy. It was done back in 2021.

I had a conversation with our CEO and the board one day and realised, “We’re not actually a fuels company, although we’re called Zero Petroleum and we’re making jet fuel and gasoline. We’re actually an energy transmission company, because all the problems we have with renewable energy are solved by liquid hydrocarbons”. If you look at the paper I referred to, done back in 2021, the cost of getting energy from the North sea in a cable to the consumer is probably forty to fiftyfold what it is if you wanted to do it with a liquid hydrocarbon. That is the fundamental problem that we are going to struggle with going forward. We are slowly going to morph as technology and engineering rather than policy dictate what the solution is.

[Luke Taylor]

Q Just for clarity—forgive my technical inexperience—what you are suggesting is production of the hydrocarbon at the source, at the base of a wind turbine, which is then collected in tanks rather than transmission over cables?

Doug McKiernan: Correct. Within that report, there were also comparisons to hydrogen—that was a sixfold increase over a two-foot oil pipeline—and to ethanol, methanol and ammonia. It looked at how you get energy from A to B in the cheapest operational expenditure and capital expenditure form. That is a fundamental. The cost of getting the renewable energy is what all the engineering will come back to. I believe the renewable energy will be in remote locations, a bit like oil today. Ultimately, we are going to put renewable energy in those places. Hopefully we do not cover all the fertile soil with solar panels and we can generate it elsewhere, and then use the power-to-liquids to get it from A to B.

[Mr Paul Kohler (Wimbledon) (LD)]

Q Using carbon dioxide to produce SAF is a wonderfully seductive and brilliant solution. You are addressing the regulatory obstacles, but what are the technical obstacles?

Doug McKiernan: To be perfectly transparent with everybody, with carbon dioxide at the moment I think the direct air capture, compared with where we are, is a bit of an Achilles heel. It is probably around two to four years behind in its scale-up, in terms of being able to keep pace with our scale-up, but actually there is plenty of biogenic carbon dioxide around for large-scale commercial plants here in the UK, which could be a stepping stone to the direct air capture. A lot of the work with direct air capture at the moment talks about the cost of it; you can sequestrate the carbon dioxide in the ground. That is not what we want to do as a petroleum company; we want to put that carbon dioxide into a liquid fuel, and then it is net zero. You have carbon dioxide and water coming out of the exhaust—whether that is a turbine or internal combustion engine. If you capture the carbon dioxide again with the direct air capture, you are then net zero.

When you integrate that direct air capture with our process, the cost of direct air capture is probably reduced by 80%, because we have an exothermic reaction going on, and the majority of the cost in direct air capture is in the de-absorption of carbon dioxide. Once you have absorbed it from the air, you have to heat up the catalyst again—or the material that has absorbed it—to get the carbon dioxide out again, and we have an exothermic reaction. We would not have those costs associated with our process. Integration of our direct air capture with our power-to-liquid solution in three to four years’ time would be quite a mature technology, and definitely scalable within the UK.

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[Amanda Hack (North West Leicestershire) (Lab)]

Q I want to put on the record that I have an airport in my constituency, so many relevant companies are based there.

You are a global company in a global marketplace. The airlines I have spoken to want to source SAF from UK markets. How attractive is that to your organisation as a global business—responding to your customers’ wanting you to deliver locally? How much does that play a part in that investment?

Ruben van Grinsven: I am going to answer in a slightly similar way. My role is very much investigating and developing supply assets. I am really looking at building SAF plans. I am not very familiar with how customers demand locally produced fuel. In general, customers look for affordability and, therefore, at price and eligibility legislation. At this point, those are the more driving factors for people to buy certain fuels.

[Luke Taylor]

Q Mr Downie stole my question, so I will develop it a bit further. The RCM sets the levy on to the fuel producers who will likely pass it on to passengers. You operate internationally and see mechanisms being implemented elsewhere in the world. We mentioned the alternative of using the ETS to fund the RCM. How do you see the advantages of one system or the other, and where have you seen alternatives implemented elsewhere that have worked well?

Ruben van Grinsven: That is a good question. First and foremost, the UK is ahead of pretty much everybody else when it comes to developing those mechanisms. I know the EU is basically inspired by the RCM and trying to come up with a similar framework, which it will be announcing in September in the sustainable transport investment plan. I think the initial thoughts are indeed to fund that through ETS.

I do not have a strong preference between ETS-funded or levy-funded. The most important thing is that it is clear, transparent, consistent and predictable. Once we know the details and find out how the whole mechanism will work, we can perfectly live with the levy mechanism—as long as it works practically. So we do not have a strong preference between ETS or levy funding.

[Tom Collins (Worcester) (Lab)]

Q You have just mentioned that you are looking broadly at SAF production and how that is going to play out into the future. Compared with other northern European countries, the UK has excellent access to renewable energy, and we had a very early responding hydrogen industry. What do you see as the UK’s unique opportunities in SAF production?

Ruben van Grinsven: There are two elements. One is the fundamentals: affordable renewable energy, other feedstocks, then the cost of building plants, labour, and everything else. At the moment, in terms of the fundamentals of renewable electricity, the UK does not have a clear advantage because power prices are slightly more expensive, and most of the renewable power in the UK is intermittent. That is an important thing that needs to be overcome.

You have a slight disadvantage compared with, for instance, the Nordics, such as Sweden and Finland; they have a lot of hydro and stable baseload renewable power. On the fundamental side, especially for power, I think there are other places that are currently a bit more competitive. However, many of the other elements, such as feedstock supply, labour and knowledge, are quite similar.

The biggest differentiator is probably the legislative and regulatory landscape. You are creating a market through mandates, which I think is extremely powerful. If you also increase investment certainty through an RCM, that element is unique and, at this point in time, very helpful.

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[Julia Buckley]

Q My second question is about your role at Heathrow. We heard from earlier witnesses that, because the generation fuels are drop-in fuels, they are fairly confident that they could rely on existing infrastructure for storage and so on. As the person in charge of Heathrow, our largest airport, how confident are you that existing infrastructure and storage spaces can accommodate drop-in fuels?

Matt Gorman: Very confident, from everything we hear from fuel suppliers in this space. Looking at the different bits of infrastructure, starting briefly with aircraft and engines, the main aircraft and engine manufacturers are in the process of certifying all their aircraft to run on 100% SAF. In a sense, we do not have to worry about that problem immediately, because—apart from dedicated flights—we do not have 100% SAF flowing through pipes, but that is clearly their goal. I forget the exact dates, but I think that by the end of this decade they will all be doing it, if not before.

On pipelines and aircraft infrastructure, one of the main reasons that we have focused on SAF is that it requires upstream investment in production facilities, but it does not require changes in airport infrastructure or planes. That means that as soon as you can start producing SAF, you can start cutting carbon. As an illustration, at Heathrow, partly in anticipation while waiting for some of the Government market signals to develop and kick in, we introduced a landing charge incentive—a financial incentive. It started at 0.5% a couple of years ago, and now 3% of all the fuel being used at Heathrow is SAF, which has dropped into our systems without any issues. I should also say that 17% of the total global production of SAF is now uplifted through Heathrow.

[Luke Taylor]

Q My question is relatively straightforward: does the Bill go far enough to allow us to proceed with aviation expansion and be consistent with our climate change goals?

Matt Gorman: This Bill is part of a package of measures from the Government, and I think it is absolutely vital. I see the Bill and the SAF mandate as equally important, with the SAF mandate driving a requirement for 10% SAF and with the Bill encouraging investment in domestic production. Those are vital tools, and the Government are taking a range of other steps. I am not here as a spokesperson for the Government, but the jet zero strategy outlines a range of measures to support the ongoing development of more efficient aircraft, which is a key tool in our toolkit, along with modernising airspace with the new UK airspace design service, which is vital for more efficient airspace, and support for new hydrogen technology and greenhouse gas removal. This is a vital part of that package.

[Luke Taylor]

Q The SAF mandate is 10% by 2030. The EU target is much lower: 6%, I think. Our target goes up to 22% by 2040, but elsewhere the target increases more dramatically. As Heathrow is such a large user—17% is a massive component—will the mandate be achievable alongside the goals and targets set out in the Bill? You have said that other things need to be done and that this is part of a suite, but I guess the question is whether this is enough. Do you need to see more aggression and more ambition, with investment in firms through skills and through the measures we have drawn out from previous witnesses around the protection of IP? Do you see this as enough?

Matt Gorman: I think this is a very strong start from the UK. I was smiling when the Shell representative said that the EU had been inspired by the measures that the UK is taking. Joking aside, I have talked to fuel suppliers and investors to get a sense of how they are seeing the market. They say that this package, with the mandate and the revenue certainty mechanism, is a really strong policy package from the UK.

To answer your question, Heathrow has been invited by the Government to submit updated proposals for our expansion plans by the end of this month. Within them, we will be setting out our views on our future trajectory to net zero. We think that the mandate and the revenue certainty mechanism are vital. The Government have already said that they want to keep the mandate levels under review; you are right that although we are more ambitious to begin with and the EU is less ambitious, the EU takes over. Our view is that heading more in the direction of the EU’s ambition over time will be important for Heathrow and for aviation generally, but we will keep that under review.

It is really important to get started and make a strong start in this decade, to show that as well as producing SAF globally for use in the UK, as we are already doing, we can produce it in the UK.

[Tom Collins]

Q You have mentioned that the UK is taking a strong leadership position on this stepping-stone technology with SAF. If the UK were to prepare itself now, early on, to be in a leadership position in sustainable aviation using hydrogen, what do you think that would look like?

Matt Gorman: I think it would look broadly like what the UK is doing. We think about it in three buckets: the plane, the airport infrastructure and the regulatory environment. It is worth remembering that UK aerospace is one of the jewels in the crown of our manufacturing sector. We have a very long history in aerospace, and the Aerospace Technology Institute funds some of that technology development alongside the private sector. That is important.

With airport infrastructure, we have always said, certainly for Heathrow, that we do not want to be a blocker. We do not want a hydrogen plane to be designed but not able to fill up at our airport. We keep an active watching brief on technology developments. We have taken a stand at Heathrow to trial hydrogen technology so that we can understand and build understanding. That is partly to influence the regulatory environment so that we are supporting the roll-out of hydrogen.

The latest views from manufacturers are that we will probably start small with hydrogen—small plane sizes and small ranges—and build confidence there before getting bigger. However, that could play a real role in domestic connectivity. I think we are doing the right things, but it is a both/and with SAF and hydrogen, not an either/or. I would also say that SAF is the solution that we know exists today and that we can deploy today, so we need to get it moving.

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[Greg Smith]

Q Can I gently push you on that? We heard from the witness from Zero Petroleum earlier that they are ready to scale now, in reference to a question from one of the Liberal Democrat Members on the Committee. If that is the case, what do you see as the barriers to those later-generation fuels being scalable now, when one witness who actually does it—sat where you are sat not half an hour ago—said they are ready to scale?

Josh Garton: Certainly, the technologies are at that point. There are still commercial challenges; they have been proven at demonstration scale but not at the commercial scale. In the UK, we have a mandate that provides space for second-generation fuels. While that mandate remains intact, there will be a lot of space for that fuel over the long term. In the EU they have a different structure, where they do not have that same space for second-generation fuels.

[Luke Taylor]

Q I want to be very careful with this question. We have had questions about investors and appetites to put money into these technologies—into refineries, production and particular projects. There was previously a fairly strong consensus on the need to address climate change, and this is one of the projects that we are doing to mitigate those impacts. There is a fair amount of rhetoric at the moment about stopping investment in net zero projects in particular regions, some of which have a heavy dependency on or a high frequency of these sorts of projects—north Lincolnshire, Humberside and such areas. Is there a risk that that sort of rhetoric damages investor confidence and that, with that sort of language and those sorts of pronouncements being made, we see challenges in delivering the jobs and the plants and seeing the capacity that we need come online?

Josh Garton: Yes, absolutely there is. It feeds into the overall narrative in the UK on the direction of SAF. It is more than just at the regional level; there are murmurings around the strength of the mandate itself and its being upheld. All those murmurings impact the narrative and the appetite for investors. The more we can do to support those first-generation plants to get through to a final investment decision and through to production, the better we prove out the sector as a viable one in the second and third-generation fuels. That narrative then falls away, because we have proof that it is a commercially viable product.

[Luke Taylor]

I admire your faith that that narrative might fall away, but I agree with the rest of the answer.

[The Chair]

If there are no further questions, thank you very much indeed, Mr Garton, for your evidence today.

Examination of Witnesses

Philip New gave evidence.

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[David Reed]

Q Just a small follow-up, if I can. You are saying that the biggest change is the US pulling back from innovation and production of SAF. Is that in direct response to what the Chinese are doing?

Philip New: No. For most global markets that have started to look at SAF, the preferred mechanism has been to impose some form of mandate—even China has put in place the beginnings of a mandate mechanism. None of them are as ambitious as those in Europe and the UK, but that is the normal mechanism. The reason for that is simply that SAF costs more than aviation fuel. Left to its own devices, an airline in a very competitive industry is unlikely to voluntarily buy more SAF than it needs to buy. If it has big corporate clients that want to offset some of their scope 3 emissions and are willing to pay a premium to have their flights decarbonised, that is fine, but there is a real limit to how big, dependable and investable that market will be.

That is where America is right now, and it is because of the structure of the other incentives in the American mechanism. A critical part of that was a change in the big, beautiful Bill, in which the premium given to SAF producers was removed completely. They now get no more money than those making diesel for ground transport use, but it costs more money to make SAF. The airlines do not have an incentive to buy SAF because there is no mandate, and the producers do not have an incentive to make SAF because it costs more to make and they get less credit from the American mechanisms in place to support renewable fuels.

[Luke Taylor]

Q As a good Liberal Democrat, I want to talk about bins again. Incineration and energy recovery facilities are broadly seen as the least worst options. If there is now an alternative, lots of us will be very interested in the opportunities for local authorities and for making conditions better for our residents. If that means cheaper bin collection, we will all be in favour.

I have questions about the big picture. It has the potential to disincentivise recycling. Does the increasing value of SAF feedstock undermine the efforts to recycle? Another, more technical question is: could plastics recycling be better diverted into this process to solve a lot of the problems we have with exporting plastics for recycling and the energy used to do that?

Many of our energy from waste facilities are now linked to heat networks. Is that bigger picture being considered—not just producing electrons, as you say, but using waste heat for district heating networks? There is a bit of additional complexity.

That leads into the bigger question of the holistic view across different Departments and the incentives that the Bill creates, which I am sure are all positive. It promotes better, more sustainable options in different Departments. Is enough work being done elsewhere for this to work within the bigger system? You have 15 minutes.

Philip New: My roots are as a fuels and energy guy, so I will not be able to respond with much expertise to the more specific questions about the waste sector. However, I will do my best by starting with the general statement that I think you are quite right that the second that waste becomes more valuable than an alternative use of that waste, you have to start questioning whether it is really waste. Funnily enough, that is more of an issue in some of the first-generation products that we are using, where the waste is becoming more valuable than virgin vegetable oils. That is a different issue, but it is very important.

In this case, as long as people either do not get anything for waste or have to pay to get rid of it, the risk of it distorting other parts of the hierarchy is manageable, particularly with a sensible degree of oversight and monitoring. I would not lose too much sleep about that. You will have to help me with the other part of the question.

[Luke Taylor]

Q It is the broader question of how this sits within the system. The implications of this Bill are really broad in the way the incentives will come into a whole different set of markets, including agriculture, waste and local government.

Philip New: First, I challenge the suggestion that this is an incentive. I think of it more as an insurance policy. If you are a recipient of the insurance policy, if it turns out that the market price is higher than you contracted for—your strike price—you will end up paying. The counterparty will be in receipt of money from the participants in the scheme. It is not a one-way incentive.

One of the charms of the RCM is that it is nicely balanced. If you are worried that the market will go long and there will be lots and lots of lower-priced product that undermines your economics, the RCM is a great way of giving you insurance that your investors will stay whole and happy.

On the other hand, by taking it on, you are sacrificing your exposure to the upside. That is the premium you are paying. I think the balance that has been designed into the RCM is a really attractive way of keeping everyone honest while still enabling investment to flow into the sector. I do not think it should distort the underlying drivers or mechanisms.

That having been said, I worry about the range of sectors that a successful SAF industry will touch. It has the potential to touch them in a very positive way, but it is also exposed to some inadvertent—I would not call it negligent—inattention in somewhere that does not feel a very strong ownership of the space, which could really mess things up. A degree of conscious, whole-system understanding of what it takes to enable a brand-new sector to emerge, and providing some co-ordination of that, would be welcome. Whether that looks a little like mission control in the electricity transition or something else, I do not know, but something to provide more comfort would be important. It touches many parts of the economy and many Departments.

[Lewis Atkinson (Sunderland Central) (Lab)]

Q Mr New, in your report you say that one of the key asks for industry is around confidence. We have talked a lot about revenue confidence today, but I want to go over that a little bit. You ask how the UK Government can demonstrate that they will stay the course, and I guess the core of that is political confidence.

Since your report, of course, we have had a change in Government, and who knows if there might be another one over the investment cycles we are talking about here? Could you say a little about your assessment of how a Bill—putting something in primary legislation, as this does—helps to provide the political confidence that you believe investors are looking for, and also, frankly, helps to mitigate the actions of the varying parties in Parliament as we approach this issue?

Philip New: There were two big pushes from the investment community when I was writing the original report connected with the RCM. The first was that it would just be nice to have that revenue certainty in the first place, and that is what we see in other parts of the green transition.

The other speaks directly to this point. They were very nervous that there might be a change to the mandate design, the mandate targets or something at some stage in the future, and that that would so change the market dynamics and the pricing dynamics that all their assumptions would go out of the window. They were not going to be satisfied with any number of assurances from the Government, because Governments change their minds, so they wanted a bilateral contractual arrangement, which is another feature of the RCM. A big driver of its original definition was precisely to respond to that very concern.

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[David Reed]

Q Professor Maslin, thank you for being with us today. You talked powerfully about the international nature of this technology set. If a country or business is not going through a good time, that technology might not come through the supply chain. From a UK perspective, where are the main weaknesses with the international supply chain? As a follow-on, are any hostile states actively trying to weaponise elements of that supply chain?

Professor Maslin: The first thing is that we have to work out a way of being self-sufficient in SAFs. If you want the mandate and the Bill to work, we have to have that self-reliance. The problem that is the quality, quantity and supply of SAFs around the world are highly variable. They are not as good as you think they are. We therefore need to be able to protect our own regulations by having a homegrown community.

On weaponisation, no, I have not seen any evidence that hostile states are going after SAFs at the moment, because they are a very small percentage of the aviation mix. At the international level, it would be helpful if the Chicago accords could be renegotiated so that you could tax aviation fuel internationally, even if the tax was small—$1 per tonne, or something like that—to shift the balance away from aviation fuel and towards SAFs being more accountable. I doubt that will be possible in these interesting political times, but that is the problem we have. We are able to tax aviation fuel internally but not internationally. Therefore, at the moment, there is no aviation fuel tax on international flights, which would be a really nice mechanism. Of course, you can see that as weaponising against the fossil fuel industry.

[Luke Taylor]

Q May I start by heartily endorsing your encouragement of engineering as a career or an education? As an aeronautical engineer before I came to this place, I am available for motivational speeches whenever necessary.

From my discussions with industry on the Bill up until now, I am not quite sure that I am convinced about being agnostic to SAF production, source and mechanism. My worry is that it does not give enough ability to shape the environmental benefit of that SAF stream and to incentivise the most beneficial SAF production, such as PTL compared with the earlier gen SAFs, even 2g SAFs. Does the Bill as presented give enough of the right mechanisms to incentivise the right sort of SAFs that will be most beneficial and provide us with the greatest environmental benefit?

Professor Maslin: The Bill provides financial security for industries producing SAFs, which I think is essential. I do not think it has real tweaks to favour particular SAFs—whether you want to do that or not is another matter. The problem is that some SAFs have a better environmental signature, and they are better, but we are going to run out of those.

Ultimately, the real SAFs that we are going to be looking at globally are massive algal productions and artificial kerosene, whereby you produce huge amounts of energy, and you use water and CO₂ from the atmosphere to actually create kerosene. That is extortionately expensive at this moment in time. However, as I said, if there are 14,000 planes, going up 4% per year, by 2050 you will have a very large number of planes in the air at any one moment in time. There will not be enough waste, cropland or algal stuff to produce the SAFs we need. Generations 4 or 5 will be the ones that ultimately look after the aviation industry. I would still say to be agnostic; I cannot believe I am saying this, but let the economics work its way through at the moment to see who comes out on top in the UK, and then take through the next generation.

[The Chair]

Professor, thank you for your evidence and for illuminating us with the alumni in our midst.

Professor Maslin: It is amazing where my students end up.

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[Tom Collins]

Q We heard some of the evidence about how effective the RCM could be in light of the difference that CfDs have made. You have already explained how to manage the levers and the number of contracts allocated to get the economics right, but can you explain how that sits alongside the SAF mandate to help us to steer UK innovation and maximise the opportunities for the UK to lead in this sector?

Mike Kane: When we came into Government in July, we had two key aviation policies. The first was airspace modernisation, and we set up the UK Airspace Design Service and passed it into legislation just the other week. In addition to improving resilience in our skies, we hope that that measure will stop planes circling and allow those that currently do not fly in a straight line to fly in a straight line, which reduces the cost of fuel—to go back to the shadow Minister’s point. Lahiru from easyJet said in his evidence that the best energy is the energy we do not use, and airspace modernisation helps us with that piece.

The second part of our manifesto commitment was SAF. After we were elected, we laid the mandate for 2% of all aviation fuel in the UK to be SAF. That came into force on 1 January. Airlines are sourcing SAF and getting supplies of it, but too much of it comes from abroad. While we have a good industry in the UK, companies need the confidence to scale it up.

I will make no party political points, but four or five years ago we were promised that by 2025 five plants would be up and running. If I were going there, I would not be starting from here, but we are getting on with doing this now. I think everyone on this Committee can be extraordinarily proud that this will be the moment that we stepped up and began to decarbonise the aviation industry.

[Luke Taylor]

Q I have one straightforward question, and one that is a little more spiky. First, we have heard a lot about the need to work across Government to ensure that we get the most effective outcome from the Bill. From all the evidence we have heard, it seems to be the right thing and structured well, but how do we ensure that municipal waste streams match up with incentives for heat networks, waste hierarchies and that sort of stuff? We hear a lot about mission-based Government—is that what will give the advantage to being able to co-ordinate across Departments? Will you give us an account of what you are doing so far to pull those Departments and different groups together to make sure it works?

Mike Kane: To get any Bill this far, as any Member will know, it has to have consent right around Government. The Government know exactly what we are doing in a joined-up way. To answer your mission question, we have said that we want to be a clean energy superpower, and this Bill helps us to do exactly that. It gives us sovereign capability here on UK shores to do that; not only is that the right thing to do, but, in the increasingly uncertain geopolitical situation we face, it is becoming almost essential.

The other mission that we have is growth. Today, I heard some very big figures on what that could mean. Our Department figures show at least £5 billion GVA added if we do this, and about 15,000 jobs—[Interruption.]

[The Chair]

Order. I am suspending the Committee for a Division in the House. We will try to get back as quickly as possible.

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[The Chair]

We now continue with our proceedings. I call Luke Pollard to continue—[Interruption.] Sorry, you are not a Minister of State yet, but you will be soon, I am sure. I call Luke Taylor.

[Luke Taylor]

Q Thank you, Mr Pritchard. Minister, your first answer was very helpful. My second question is on a theme that I have brought up a couple of times, and which echoes the evidence around ETS funding from a couple of the witnesses. I am going to be a bit pointed, but if you had had the choice and the permission from the Treasury to get the funding from the ETS, rather than passing it on to firms and then passengers, would you have seen that as an optimal solution, in these constrained times?

Mike Kane: As the departmental Minister, I want to avoid the pitfall of commenting on Treasury policy, but I did hear some earlier evidence that £500 million came in from the ETS. What did they get back for it? Well, £2.3 billion of investment in the ATI, which is looking at engine capacity, hydrogen and reduced noise technologies. We are investing more than we ever have in that area. We are also now aligning, or are in negotiations to align, our ETS with the European Union. That would give us a bigger market, and therefore help aviation in this space.

In addition to the £2.3 billion, the Chancellor recently announced £63 million for the advanced fuels fund. The Government are putting their money where their mouth is. As part of the work that I have done this year to restart our confidence in aviation, I set up the jet zero taskforce, which is jointly chaired by me and the Minister for Industry, my hon. Friend the Member for Croydon West (Sarah Jones), at DBT. There is an awful lot of joined-up thinking in this area.

[Amanda Hack]

Q In terms of SAF’s growth potential, I would be interested to hear more about how smaller organisations can get involved and how we can ensure that lots of businesses benefit from this huge step forward for our economy. A lot of SAF production will be in coastal areas, but my constituency, which has an airport, is inland. How can that growth potential reach all parts of the UK?

Mike Kane: Indeed, and Amanda, you are a great champion of East Midlands airport in your constituency—I have Manchester airport in mine, and I see from day to day the benefits that growth brings in terms of jobs, skills and inward investment. You make exactly the right point. Good strategy is turning what you have into what you need to get what you want.

We have industrial heartlands dotted right across our nation, including in our coastal communities. They are almost oven-ready to host the technology, inward development and jobs. Our analysis, which was a minimum compared with those of everybody else in the room, is that this would create 15,000 jobs in the next few years and £5 billion in GVA. Those jobs are in many of our run-down coastal communities and industrial heartlands, so this is a win-win on many levels—in terms of decarbonisation, carbon capture, production and the regeneration of parts of our nation that have been left behind for far too long.