Momentum is building in the development of Sustainable Aviation Fuels (SAF), driven by recent policy implementations in both the European Union and the United Kingdom. However, industry experts say that clarity and certainty around investment remain critical to unlocking the necessary capital and accelerating production.
A panel discussion at the Sustainable Skies 2025 World Summit discussed SAF progress over the past year, particularly since key mandates came into force.
Nora Roussi, representing the EU policy perspective, highlighted the Refuel EU aviation initiative as the legislative framework promoting both the use and production of SAF.
She said significant progress has been made, especially since the entry into force of the EU mandate, which includes a 2% SAF requirement.
While acknowledging increased biofuel production exceeding targets until at least 2034, challenges persist, particularly with synthetic aviation fuels (eSAF) and the significant price gap between SAF and regular jet fuel.
There are about 25 eSAF projects in Europe awaiting investment decisions, which are needed soon to meet the 2030 mandate of 1.2% eSAF use.
To address these investment hurdles, the EU plans to adopt a Sustainable Transport Investment Plan by the end of the year, aiming to stimulate investment and shift from a “first-mover disadvantage” to a “first-mover advantage” by rewarding risk-taking and courage.
The EU is also developing a voluntary flight emissions label to provide passengers with transparent information about the greenhouse gas emissions of flights, allowing them to make more informed and sustainable travel choices.
Amy Ruddock, Senior VP of Sustainable Aviation and Corporate Development at Willis Lease Finance, said that the past year has seen significant momentum in the UK.
The details of the UK’s SAF mandate have provided a very clear value proposition for advanced biofuels, including a buyout price and a carbon intensity link. This clarity has helped project developers build momentum towards the Final Investment Decision (FID).
Noaman Al Adhami, UK Country Head for Alfanar Projects and involved in the Lighthouse Green Fuels project in Teesside, described the project as “the most advanced second-generation SAF project in Europe and one of the largest globally by capacity”.
Alfanar is a privately owned multinational group with a significant renewable energy portfolio, focusing on renewable fuels in the UK, with a particular emphasis on Sustainable Aviation Fuel (SAF).
Despite the progress, project developers face considerable challenges. Al Adhami stated that taking significant risks is necessary to advance projects, even with government support, such as Innovate UK Future Flight Fund grants, which support innovations in SAF production technologies, testing, and integration into future flight systems.
He highlighted that the UK mandate’s unique features, such as a “clear market for second-generation SAF by 2030” and the “link to carbon intensity and carbon capture utilisation and storage”, are crucial for justifying investment in second-generation fuels in the UK.
Ruddock said that, while they could technically have reached FID by late 2024 based on engineering and supply contracts, the critical path is securing long-term offtake agreements, which are essential for project financing.
A major driver of hesitation in signing these agreements is the uncertainty surrounding the details of the upcoming Revenue Certainty Mechanism (RCM), a UK government policy tool to reduce the financial risks associated with investing in the production of SAF.
The discussion also touched upon cross-border dynamics, with a US-based producer, Development Twelve, exporting SAF to Europe, driven by EU and UK mandates, alongside US tax incentives such as the 45Z Clean Fuel Production Credit.
While it is currently viable to produce SAF in the US for export, Ashwin Jadhav, Vice President Business at Development Twelve, said that the policy landscape is shifting, and future production locations will be subject to constant review, potentially leading to more European production in the future.
Addressing workforce challenges, particularly in the UK, Al Adhami said that drawing on the country’s strong oil and gas engineering base has helped in obtaining the necessary technical expertise.
Panellists from left: Alastair Blanshard, Sustainable Aviation; Amy Ruddock, Willis Lease Finance; Ashwin Jadhav, Development Twelve; Noura Rouissi, EU Transport; Noaman Al Adhami, Alfanar Projects
