Logistics giant DHL Group announced a new agreement with U.S.-based energy products manufacturer Phillips 66 for the purchase of more than 240,000 metric tons (314 million liters) of sustainable aviation fuel (SAF), to be delivered to U.S. airports over three years.
The deal marks one of the largest SAF agreements by a U.S. producer to date, and is anticipated to reduce lifecycle greenhouse gas (GHG) emissions by approximately 737,000 metric tons compared to conventional jet fuel, according to DHL.
Scaling the use of sustainable aviation and alternative fuels forms a significant part of DHL’s Sustainability Roadmap. Launched in 2021, the roadmap included plans to invest €7 billion over ten years in measures to reduce its CO2 emissions, with a focus on the expansion of a zero-emissions fleet, alternative aviation fuels, and climate-neutral buildings. In addition to its 2050 net zero goal, DHL also has interim targets to increase the share of more sustainable fuels across all transportation modes to more than 30%, and to electrify two-thirds of last-mile delivery vehicles by 2030.
In addition to supporting DHL’s sustainability goals, the new agreement is expected to contribute significantly to the company’s carbon “insetting” GoGreen Plus service, which enables customers to reduce their Scope 3 GHG emissions using SAF.
Travis Cobb, EVP Global Operations and Aviation at DHL Express, said:
“This agreement with Phillips 66 is a significant milestone for DHL Express as we work towards our sustainability goals. By securing a reliable supply of SAF, we are not only reducing our carbon emissions – and those within our customers’ supply chains – but also setting a precedent for the logistics and air cargo industries in the U.S.”
Under the new agreement, Phillips 66 will deliver SAF to DHL Express from the energy company’s Rodeo Renewable Energy Complex in California. Phillips 66 announced in 2022 that it planned to convert its oil refinery in Rodeo to process only renewable feedstocks, with the facility no longer processing crude oil and instead using waste oils, fats, greases and vegetable oils instead to produce 800 million gallons per year (over 50,000 barrels per day) of renewable transportation fuels, including renewable diesel, renewable gasoline and sustainable aviation fuels (SAF). The company announced the completion of the conversion last year. The complex is now one of the largest renewable fuel facilities in the world, and has an SAF production capacity of 150 million gallons per year.
The SAF will be delivered primarily to Los Angeles International Airport, with future intended deliveries to other West Coast airports where DHL maintains operations.
Brian Mandell, EVP Marketing and Commercial at Phillips 66, said:
“This agreement between Phillips 66 and DHL demonstrates our shared commitment to SAF market leadership and credible action in the growing SAF industry. Through our global renewable fuel business, we are committed to supporting DHL and our customers in achieving their decarbonization goals.”
