Sustainable aviation fuel or SAF is biofuel produced from sustainable feedstocks such as used cooking oil, agricultural and forest residues, and municipal solid waste and is blended with conventional jet fuel. SAF provides the same performance as conventional jet fuel but significantly reduces greenhouse gas emissions by 80% or more over the conventional fossil fuel life cycle. These emissions savings, along with energy security and fuel price stability benefits, are driving adoption of SAF worldwide.
The global Sustainable Aviation Fuel Market is estimated to be valued at US$ 8 Billion in 2023 and is expected to exhibit a CAGR Of 19% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Stringent emission norms adopted by the industry and regulatory bodies compel airlines as well as fuel suppliers to integrate higher blend of SAF in conventional jet fuel. In 2021, the International Civil Aviation Organization (ICAO) agreed on the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). Under CORSIA, airlines will need to acquire emissions offsets for their international flights starting in 2027. Additionally, International Air Transport Association's (IATA) goal to achieve net-zero carbon emissions by 2050, has accelerated the commercial availability and adoption of SAF. Major airlines like Alaska Airlines, American Airlines, JetBlue, United Airlines, and others have signed long term offtake agreements with SAF producers to procure a certain percentage of their jet fuel from SAF over the next decade. These regulatory push as well as commitments from airlines are expected to significantly drive the growth of SAF market during the forecast period.
Segment Analysis
The global sustainable aviation fuel market is primarily segmented into hydroprocessed fatty acid esters and fatty acids (HFA), Fischer-Tropsch (FT) synthesized paraffinic kerosene, and alcohol-to-jet (ATJ). The HFA segment currently dominates the market due to the availability of readily available feedstocks such as used cooking oil and animal fat. The HFA fuel is a direct substitute for conventional jet fuel and requires no engine modification.
Key Takeaways
The Global Sustainable Aviation Fuel Market Demand is expected to witness high growth over the forecast period. Regional analysis - North America is currently the largest as well as the fastest growing regional market for sustainable aviation fuel. The region has ambitious climate goals and government policies supporting the development and deployment of low carbon aviation fuels.Key players analysis - Key players operating in the sustainable aviation fuel market are Neste, TOTAL, Swedish Biofuels, LanzaTech, Avfuel Corporation, and Velocys.
Regional analysis –
North America currently accounts for the lion's share of global sustainable aviation fuel consumption. Stringent environmental regulations and the presence of major aviation industry players have boosted adoption. The U.S. and Canada are actively supporting research and production of alternative jet fuels.
Key players analysis –
Key players operating in the sustainable aviation fuel market are Neste, TOTAL, Swedish Biofuels, LanzaTech, Avfuel Corporation, and Velocys. Neste is the global leader in renewable jet fuels production. TOTAL is a major producer of fuels from agricultural and forestry waste. Swedish Biofuels and LanzaTech focus on cellulosic ethanol and gas fermentation technologies.
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