• Microsoft to co-fund 39,000 tonnes of SAF, cutting 113,000 tonnes of lifecycle emissions — the largest and longest Scope 3 SAF agreement between an airline and corporate customer.
• SAF to be sourced from UK’s Phillips 66 and US-based LanzaJet, both using sustainable feedstocks and certified by ISCC.
• IAG’s total SAF-related investment surpasses $3.5B, supporting long-term decarbonization of air travel and logistics.

IAG and Microsoft have expanded their 2023 agreement for Sustainable Aviation Fuel (SAF), extending it by five years in what is now the most extensive Scope 3 SAF commitment on record between a corporate and an airline.

Under the new terms, Microsoft will co-fund 39,000 additional tonnes of SAF — reducing lifecycle emissions by approximately 113,000 tonnes. Scope 3 includes emissions from activities outside a company’s direct control, such as business travel and freight.

“We are taking our collaboration with IAG further, extending our SAF purchase agreement to bring Microsoft closer to our goal of being carbon negative by 2030, while ensuring a multi-year commitment to help drive greater SAF production,” said Julia Fidler, Environmental Sustainability Fuel and Materials Decarbonization Lead at Microsoft.
“We are pleased to work alongside IAG on efforts to increase demand and make SAF more widely available through our shared long-term purchase agreement.”

This strategic partnership enables Microsoft to decarbonize business travel and global freight while allowing IAG to scale SAF use and reduce its direct (Scope 1) emissions.

The SAF will be produced from:

• Used cooking oil and food waste at Phillips 66’s Humberside refinery (UK), and
• Sustainably sourced bioethanol at LanzaJet’s Freedom Pines Fuels facility (USA), the world’s first commercial-scale alcohol-to-jet fuel plant.

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Both production pathways are certified under the International Sustainability & Carbon Certification (ISCC).

“We’re pleased to work with like-minded organisations such as Microsoft to expand efforts to reduce flying lifecycle emissions,” said Jonathon Counsell, IAG’s Group Sustainability Officer.
“Long-term agreements help encourage much-needed funding in SAF production, something that IAG is championing through our investment in global SAF projects such as LanzaJet.”

The big picture:

• Microsoft is also co-funding SAF for air freight used in shipping its global data center components.
• IAG’s 2024 SAF usage reached 1.9% of its total fuel, and its total SAF investment (including future commitments) has topped $3.5 billion.
• Microsoft’s $1B Climate Innovation Fund has previously invested in LanzaJet, bolstering SAF infrastructure.

This landmark SAF agreement is a blueprint for how major corporations and airlines can work together to decarbonize aviation at scale — signaling growing momentum for private-sector-led climate action.

To read the full agreement, click here.

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