Sustainable aviation fuel (SAF) is a cornerstone of the aviation industry’s net-zero 2050 strategy, with current adoption accelerating but still in its early stages. SAF production tripled from 2022 to 2023 (0.6 billion liters) and is projected to double again in 2024 (1.25 billion liters), though it currently represents just 0.3% of global jet fuel use[1][2]. Key policies like the UK’s SAF Mandate—starting at 2% blending in 2025 and rising to 22% by 2040[6]—and the EU’s ReFuelEU initiative aim to stimulate demand. Major milestones include Virgin Atlantic’s 2023 transatlantic flight using 100% SAF[1] and Airbus’s global 100% SAF delivery capacity[3].
Price Trends and Cost Challenges
SAF remains 3–4x more expensive than conventional jet fuel[3], with HEFA-based SAF priced at $2,000/tonne in 2024 (vs. fossil kerosene at ~$700/tonne)[4]. By 2025, UK mandates could push prices to £5,000/tonne (70% of the UK’s buyout fee ceiling)[4]. Long-term forecasts vary:
- EU Quota Pathway: SAF costs €0.26–€1.77/gallon by 2050[5].
- IEA Net Zero Pathway: €0.60–€2.44/gallon[5].
Cost reductions depend on scaling production, technology innovation, and policy incentives like tax credits.
Policy Landscape
| Region | Key Policies | 2030 Target | 2050 Target |
|---|---|---|---|
| UK | SAF Mandate (2% in 2025 → 22% by 2040) | 10% | Net-zero aviation[6] |
| EU | ReFuelEU blending mandates, €1.5B SAF plant in Rotterdam (250k tons/year)[2] | 5% | 70% SAF blend[1] |
| Global | ICAO’s 5% carbon intensity reduction by 2030; IATA SAF Registry (2024)[1] | – | 65% emissions reduction[1] |
Key Challenges
- Feedstock Scarcity: HEFA—the dominant SAF pathway—faces limited oil/fat feedstock supply post-2030[2]. Alternatives like municipal waste and synthetic fuels require significant R&D.
- Policy Fragmentation: Inconsistent regional mandates (e.g., US incentives vs. EU quotas) create market uncertainty[2][4].
- Investment Gaps: Annual investments of ~$1.5 trillion are needed for production scaling, comparable to renewable energy transitions[1].
- Margins and Overcapacity: SAF margins slumped in 2024 due to overproduction, though demand is expected to outstrip supply by 2030[2].
Future Trajectory
- By 2030: SAF demand could reach 10 million tonnes/year (12% of aviation fuel)[2], driven by EU mandates and corporate net-zero pledges.
- By 2050: SAF must cover 65–70% of aviation’s emissions reductions, requiring a 3,500x production increase from 2023 levels[1][3].
The industry’s success hinges on global policy alignment, feedstock diversification, and cost-competitive pricing. Initiatives like IATA’s SAF Matchmaker[1] and Airbus’s Book and Claim system[3] are critical to bridging supply-demand gaps. While challenges persist, SAF’s role in decarbonising aviation is irreplaceable—provided stakeholders act swiftly to address bottlenecks.
Citations:
[1] https://www.iata.org/en/iata-repository/pressroom/fact-sheets/fact-sheet-sustainable-aviation-fuels/
[2] https://www.consultancy.eu/news/11402/global-demand-for-sustainable-aviation-fuel-saf-to-explode-by-2030
[3] https://www.airbus.com/en/airbus-summit-2025/saf-in-focus-whats-next-for-aviation-fuel
[4] https://www.avioxx.co.uk/policy-impacts-on-SAF-pricing-supply-and-global-adoption.html
[5] https://www.carbonclick.com/news-views/exploring-the-real-costs-of-sustainable-aviation-fuels
[6] https://www.gov.uk/government/collections/sustainable-aviation-fuel-saf-mandate
[7] https://www.addleshawgoddard.com/en/insights/insights-briefings/2025/energy/uk-government-support-sustainable-aviation-fuel-industry/
[8] https://www.sustainableaviationfutures.com/saf-spotlight/scale-up-saf-king-and-spalding
[9] https://www.leadventgrp.com/blog/overcoming-the-barriers-to-widespread-adoption-of-sustainable-aviation-fuel-saf
[10] https://www.carbonclick.com/news-views/the-future-of-sustainable-aviation-fuel-a-path-to-sustainable-skies
[11] https://www.bcg.com/publications/2025/sustainable-aviation-fuels-need-a-faster-takeoff
[12] https://www.rff.org/publications/reports/sustainable-aviation-challenges-strategies-policies-for-greener-aviation/
[13] https://www.linkedin.com/pulse/jet-zero-challenges-sustainable-aviation-h9rce
[14] https://www.weforum.org/publications/global-aviation-sustainability-outlook-2025/
[15] https://assets.publishing.service.gov.uk/media/6762717b26a2d1ff182534f7/saf-mandate-compliance-guidance-2025.pdf
[16] https://climatecatalyst.org/wp-content/uploads/2025/03/Sustainable-aviation-fuel-policy-in-the-UK.pdf
[17] https://www.easa.europa.eu/en/domains/environment/eaer/sustainable-aviation-fuels
[18] https://www3.weforum.org/docs/WEF_EMBARGOED_CST_Ambition_Statement_for_Signatories.pdf
[19] https://rmi.org/unraveling-willingness-to-pay-for-sustainable-aviation-fuel/
[20] https://www.strategyand.pwc.com/de/en/industries/aerospace-defense/real-cost-of-green-aviation.html
[21] https://assets.publishing.service.gov.uk/media/679a0f8fa39e422368d10dce/dft-saf-revenue-certainty-mechanism-government-response.pdf
[22] https://www.gov.uk/government/publications/about-the-saf-mandate/the-saf-mandate-an-essential-guide
[23] https://climatecatalyst.org/learning-hub/sustainable-aviation-fuel-policy-in-the-uk/
[24] https://www.energyvoice.com/insights/energy-opinion/563901/the-path-to-sustainable-aviation-fuel-overcoming-investment-and-production-barriers/
[25] https://www.publicissapient.com/insights/sustainable-aviation-fuel-challenge
[26] https://www.energy-transitions.org/publications/sustainable-aviation-fuel-blending-mandate-europe/
[27] https://ukdefencejournal.org.uk/military-fuel-to-include-sustainable-aviation-fuel-from-2025/
[28] https://www.idtechex.com/en/research-article/sustainable-aviation-fuel-key-market-drivers-and-production-tech/32080
[29] https://www.greenairnews.com/?p=6447
[30] https://www.ifminvestors.com/en-gb/news–insights/thought-leadership/flying-into-the-future-shifting-to-sustainable-fuel-sources/
[31] https://knowledge.energyinst.org/new-energy-world/article?id=127284
[32] https://www.greenairnews.com/?p=6952
[33] https://aviationweek.com/special-topics/sustainable-aviation-fuel/saf-remain-twice-much-kerosene-until-mid-century-says
[34] https://www.iba.aero/resources/articles/whats-the-cost-of-aviations-sustainability-drive-in-2025/
[35] https://paradigmfutures.net/a/education/saf-price/
[36] https://theicct.org/publication/fuels-us-eu-cost-ekerosene-mar22/
[37] https://www.rolandberger.com/en/Insights/Publications/SAF-The-time-is-now.html
[38] https://www.marks-clerk.com/insights/latest-insights/102jsil-greening-up-air-travel-new-rules-on-sustainable-aviation-fuel-saf-now-in-force-in-the-uk/
[39] https://www.greenairnews.com/?p=6962
[40] https://transport.ec.europa.eu/transport-modes/air/environment/refueleu-aviation_en
[41] https://earth.org/sustainable-aviation-fuel-state-of-the-industry-and-challenges-in-2024/
[42] https://www.greenairnews.com/?p=6460
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