GENEVA, Switzerland — With the year 2030 fast approaching, the aviation industry is anticipating a significant shift towards sustainable aviation fuel (SAF). However, recent projections suggest that airlines may fall short of their targets.
The 2030 SAF Commitment Under Pressure
According to the latest forecasts from the International Air Transport Association (IATA), SAF production is expected to slow down by 2026. Several major airlines, including Delta, Southwest, JetBlue, Air France-KLM, and members of the Oneworld alliance, have committed to integrating 10% SAF into their flying operations by 2030. Yet, IATA’s Director General, Willie Walsh, expressed skepticism. During the Global Media Day held on December 9, he stated, “I believe those figures are going to be impossible to achieve.”
Air New Zealand Sets a Precedent
In a notable move this year, Air New Zealand became the first global carrier to retract its 2030 sustainability promise, citing a supply shortfall that renders such ambitions unattainable. Walsh predicts that many airlines might follow suit as challenges become more pronounced.
Current State of SAF Production
IATA projects that global SAF production will reach 634 million gallons this year, marking a significant increase of nearly double compared to last year. Next year, production is estimated to rise further to 800 million gallons, a growth rate of 26%. Despite this increase, SAF will only account for approximately 0.6% of global jet fuel consumption in 2023, with a slight increase to an estimated 0.8% in 2024.
Challenges Ahead: Pricing and Mandates
The introduction of mandates in the U.K. and EU this year requires SAF to comprise 2% of fuel supplies, a move that IATA has robustly opposed. Walsh pointed out that large fuel producers may be taking advantage of these mandates to inflate SAF prices, resulting in decreased demand. Currently, SAF prices in the U.S. are around five times higher than traditional kerosene-based jet fuel, while prices in the U.K. and EU include an additional premium of about 20%.
U.S. Leads in SAF Production
The United States currently leads the globe in SAF production, generating over 50% more than Europe. This can be attributed in part to the U.S. government’s approach, which emphasizes tax incentives for SAF production instead of enforcing rigid requirements. Recent federal incentives for SAF have been extended, although at a lower rate than those under the previous administration.
Long-term Goals: Net-Zero Emissions by 2050
Despite the current outlook, airlines worldwide are still committed to achieving net-zero emissions by 2050, with plans for 65% of these reductions to come from an increased adoption of SAF. Walsh maintains that while the 2050 goal is still attainable, the path forward is becoming increasingly challenging.
As these developments unfold, the aviation industry will continue to grapple with balancing sustainability goals alongside economic realities. Stakeholders remain hopeful that innovative solutions will emerge to enhance SAF production capabilities and drive down costs, facilitating a greener future for air travel.
