- SAF production will triple by 2024 but only meet 0.53% of aviation fuel needs, requiring further scalability.
- Tax incentives and federal initiatives, like the Biden administration’s net-zero goal by 2050, drive SAF adoption.
- Innovation, investment, and regulatory clarity are essential to overcoming SAF’s cost and production challenges.
Sustainable aviation fuels (SAF) offer a vital solution to reduce aviation’s carbon emissions. Aviation currently contributes 11% of transportation-related greenhouse gas (GHG) emissions, making it the third-largest source in the sector. Industry leaders view switching to sustainable fuels as a significant long-term decarbonisation path.
SAF production will triple from 2023 to 2024, reaching 1.875 billion litres. Maturing supply chains and repurposing industrial infrastructure drive this growth, and federal and state tax incentives boost investment. However, SAF will only meet 0.53% of aviation fuel needs by 2024, highlighting scalability challenges.
Producers create SAF from various non-petroleum sources, including used cooking oil, municipal waste, and agricultural residues. SAF blends easily with conventional jet fuel, but it still lacks the energy density of fossil fuels, and higher production costs limit its adoption.
Industry experts emphasise the need for continued innovation, regulatory stability, and public-private partnerships to overcome SAF’s limitations. The Biden administration’s net-zero GHG emissions target by 2050 and the Sustainable Aviation Fuel Grand Challenge aim to scale SAF production to 35 billion gallons by 2050.
Private sector initiatives further support SAF. The International Air Transport Association (IATA) has pledged net-zero emissions by 2050. The Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) allows airlines to reduce carbon offsets by using SAF, encouraging wider use.
Tax incentives further accelerate SAF growth. The Inflation Reduction Act offers $1.25 per gallon for SAF, which reduces GHG emissions by 50%, with additional credits for more significant reductions. States like California and Minnesota have introduced low-carbon fuel programs and incentives for in-state production.
Strong demand exists, with every barrel of SAF produced already sold. However, further investments in long-term SAF agreements and more research and development will help increase production to meet rising demand.
As regulations rapidly change, companies must stay informed. SAF producers need to assess the carbon intensity of their fuels to qualify for incentives and comply with new standards. Pressure mounts for the aviation industry to reduce emissions, and SAF plays a critical role in these efforts.
While challenges remain, SAF offers significant potential to decarbonise the aviation sector. With more investment and policy support, SAF will help reduce aviation’s environmental impact.