SK Energy has announced a groundbreaking achievement through the exportation of Sustainable Aviation Fuel (SAF) to Europe, marking the first major step for the South Korean refiner. This is merely four months since the company commenced its commercial production of SAF. It is a feat that makes SK Energy the first Korean company to establish a large-scale SAF production system.

Entry into the European Market Amid SAF Mandates

SK Energy has joined the fray and quickly entered into the market within the context that the European Union has just issued a mandatory order for SAF beginning January 2025. EU’s climate policy stipulates at least 2% SAF, starting from 2025 to increase up to 6% by 2030, and up to 70% by 2050. All these put it in the company’s position with the potential in the global momentum towards sustainability.

On January 5, SK Energy announced that the company had achieved successful exportation of SAF manufactured by its newly developed Co-Processing method. Co-Processing refines bio-based feedstocks – including used cooking oil and animal fats – simultaneously with traditional petroleum feedstocks into low-carbon fuels such as SAF.

A Robust Production System for SAF

The company has developed a production system that can annually produce 100,000 tons of SAF and other low-carbon products. Large quantities of SAF exported by SK Energy are attributed to its large-scale production capacity. This enables the company to meet the increasing demand for SAF worldwide while remaining competitive in a fast-changing market.

An SK Energy spokesperson said, “Our extensive production system, bolstered by the R&D expertise of SK Innovation Institute of Environmental Science and Technology, and the engineering proficiency at SK Innovation’s Ulsan Complex, was pivotal in achieving this export milestone.”

Building a Global SAF Value Chain

SK Energy strengthens its achievements in SAF production through strategic partnerships. SK Energy has teamed up with SK On Trading International, which invested in a company specializing in waste-based raw materials. This collaboration lets SK Energy complete the SAF value chain, from sourcing to production, improving efficiency and sustainability.

SK Energy plans to expand its domestic SAF supply and grow its share in the global SAF market moving forward. The company’s expansion supports IATA’s Net Zero by 2050 target, aiming to cut aviation CO2 emissions by 50% from 2005.

The company also plans to track changing SAF policies and market demands, aiming to expand its production and export capacity.

Also read: UK’s Sustainable Aviation Fuel Mandate Takes Effect to Decarbonise Air Travel

The demand for SAF is expected to continue rising as countries and organizations adopt stricter emissions reduction targets. The IATA’s Net Zero by 2050 plan, along with EU and U.S. policies, will likely boost SAF production growth. The EU’s SAF mandate is set to drive significant market growth, with Europe already leading in SAF adoption.

Bloomberg LP has acquired Viridios AI, a carbon analytics and data company, from its parent, Viridios Group. This strategic move allows Bloomberg to expand its carbon market offerings significantly. The acquisition strengthens Bloomberg’s commitment to providing comprehensive carbon market data and analytics for clients.

Viridios AI’s Role in the Deal

Viridios AI has spent five years developing a unique and powerful dataset for carbon markets. The company specializes in carbon credit pricing, valuations, and project data. This acquisition will bring all existing data and insights to Bloomberg, further enhancing the company’s offerings. Several key members from Viridios AI, including CEO Bertrand Le Nezet, will join Bloomberg’s team to continue driving innovation in the carbon space.

Also read: Singapore-backed climate action data trust boosts transparency in carbon credit trade

Eddie Listorti, CEO of Viridios Group, said, “This agreement with Bloomberg is the culmination of five years of innovative data science, research and analysis by the team at Viridios AI and I would like to acknowledge everyone in the team who has worked to build such a unique and powerful carbon market dataset.”

Potential Growth for Carbon Markets

The acquisition follows a difficult year for voluntary carbon markets in 2024. Trading volumes and prices fell due to media scrutiny, which reduced demand. But, with the establishment of a global carbon market under Article 6 of the Paris Agreement, the landscape has experienced changes. This change was agreed upon at COP29.

Benefits for Bloomberg Clients

Emilie Gallagher, Global Head of Commodities, FX, and Macro Product at Bloomberg, expressed that the company was excited to welcome the voluntary carbon credit data, analytics, and expertise transferred from Viridios. She also mentioned that they looked forward to the valuable contributions from the new team members, which would support Bloomberg’s expansion in the carbon markets space. Gallagher emphasized that Bloomberg’s goal was to continue driving innovation and provide clients with the high-quality data and insights needed to navigate the rapidly evolving markets.

For Bloomberg’s clients, including banks and asset managers, the integration of carbon pricing data into the Bloomberg Terminal is a key advantage. These clients can now access reliable and up-to-date carbon market information directly on their existing platforms. This will be especially valuable for those considering establishing a dedicated carbon trading desk in the future.

Future Focus for Viridios Group

With this acquisition, Viridios Group will shift its focus toward developing digital climate solutions. Through Pangolin Associates, the company plans to create tools for measuring greenhouse gas (GHG) emissions. These tools will be tailored for corporate clients looking to improve their sustainability efforts.

The acquisition of Viridios AI by Bloomberg marks a significant step in the evolution of carbon markets. The deal enhances Bloomberg’s capabilities in providing high-quality carbon market data, analytics, and insights to a growing number of financial clients. It also sets the stage for further growth and innovation in the voluntary carbon markets.