SAF: The Future of Green Air Travel

The decarbonization of aviation is no longer an abstract ambition. With mounting regulatory pressure, shifting investor expectations, and the rising cost of inaction, the role of Sustainable Aviation Fuels (SAFs) has evolved from a pilot project discussion to a boardroom priority. While SAFs account for less than 1% of global aviation fuel use today, industry forecasts, including IATA and ICAO projections, suggest that they will need to make up over 60% of fuel demand by 2050 to meet net-zero targets.

This shift requires more than supply; it requires scale, infrastructure, policy coordination, and market confidence. This article explores the commercial, policy, and innovation factors shaping SAF’s trajectory from niche to necessity.

Feedstock Availability: Strategic Resource, Scarce Reality

Feedstock is the most defining and limiting factor in SAF scalability. HEFA-based fuels, which rely on used cooking oil, tallow, and other lipid-based waste, currently dominate production due to proven technology readiness. But these sources are constrained by volume. According to McKinsey, global waste lipid supply can support only 20–30 million tonnes of SAF per year, far below the 300–450 million tonnes projected by 2050.

Emerging feedstocks like agricultural residues, forestry waste, and municipal solid waste offer greater volume potential but remain logistically complex and unevenly distributed. The feedstock-to-fuel supply chain requires new infrastructure and robust traceability systems to meet both environmental standards and customer expectations.

For long-term viability, power-to-liquid (PtL) fuels derived from green hydrogen and captured CO₂ offer the highest sustainability profile and scalability but require substantial upfront investment and renewable electricity availability.

Technology Pathways: Maturity vs. Momentum

HEFA (hydroprocessed esters and fatty acids) remains the most commercially mature SAF pathway. With ASTM approval and integration into existing refineries, HEFA is currently the industry workhorse. Yet its long-term potential is capped by lipid feedstock scarcity.

Fischer-Tropsch (FT-SPK) and Alcohol-to-Jet (ATJ) offer higher scalability by leveraging lignocellulosic biomass and ethanol feedstocks. FT, in particular, benefits from legacy experience in GTL (gas-to-liquid) processes. However, both require extensive CAPEX and have fewer operational facilities.

Power-to-Liquid (PtL) fuels are garnering attention due to their ability to close the carbon loop. Electrofuels derived from renewable electricity, water, and CO₂ have the smallest land-use footprint but are farthest from commercial scale. EU-backed projects, such as Norsk e-Fuel and Sunfire, aim to bridge this gap, though projected output remains modest until 2030.

Innovation is accelerating, but commercial maturity still lags. The pathway mix will remain diversified across regions, depending on feedstock access, policy incentives, and industrial capability.

Commercial Viability: Closing the Price Gap

SAF costs currently range from 2 to 5 times higher than fossil jet fuel. This is a function of feedstock costs, limited scale, and nascent infrastructure. Bridging this gap is essential for mass adoption.

Corporate offtake agreements such as those signed by Delta, Lufthansa, and Microsoft are helping underwrite early SAF demand. Long-term contracts offer producers bankability, yet volumes remain a fraction of what’s needed. To scale, SAF projects must compete for capital against other decarbonization investments offering faster payback.

According to BloombergNEF, by 2030, SAF production costs could drop by 30–40% with increased scale and supportive regulation. However, parity with fossil jet fuel will likely depend on carbon pricing, subsidies, and mandates.

Policy and Regulation: Incentives Drive Action

The policy landscape is rapidly evolving, with mandates and incentives forming the backbone of SAF acceleration.

EU: The ReFuelEU Aviation initiative sets a 2% SAF blending mandate by 2025, rising to 70% by 2050. Only fuels meeting strict GHG reduction thresholds qualify, creating demand for high-integrity pathways like PtL.
US: The Inflation Reduction Act (IRA) provides SAF tax credits based on lifecycle carbon intensity, up to $1.75/gal, catalyzing domestic production. California’s LCFS offers additional stacking potential.
Global: ICAO’s CORSIA framework, though voluntary until 2027, sets a baseline for carbon offsetting and SAF eligibility. The scheme may evolve toward mandatory participation, increasing pressure on carriers.

Policy clarity and consistency are vital. Delayed or fragmented regulation creates investment uncertainty, especially for capital-intensive projects with 10–15 year payback horizons.

Corporate Strategy: Airlines, Fuel Producers, and OEMs

Airlines are evolving from buyers to co-investors. United Airlines’ investment arm, for instance, has backed SAF startups like Fulcrum and Cemvita. Lufthansa Group recently signed multi-year offtake deals with Shell and TotalEnergies.

Refiners, such as Neste, World Energy, and Eni, are leading the commercial SAF rollout, while integrated oil majors are entering via partnerships and conversions of existing refineries. OEMs like Airbus and Boeing are pushing for 100% SAF compatibility by 2030.

Cross-sector collaboration is essential. Airlines alone cannot absorb the green premium. Shared investment across value chains, airports, logistics providers, and energy suppliers will define successful SAF deployment.

Infrastructure: Blending, Logistics, and Airport Readiness

Infrastructure remains a bottleneck. SAF is typically blended with fossil jet fuel offsite and trucked to airports. Only a handful of global hubs (e.g., LAX, Schiphol, Heathrow) offer on-site blending or direct SAF pipelines.

Logistical fragmentation inflates costs and limits transparency. Harmonizing fuel specifications, improving storage capacity, and upgrading airport fueling systems will be critical as mandates increase.

Industry groups like IATA and SAFRAN are working on harmonized certifications and tracking systems to build trust across supply chains. Digital traceability platforms, supported by blockchain or other verification tools, are also emerging.

Regional Outlook: Diverging Paths, Shared Goals

Europe is regulatory-first. The EU’s binding SAF mandates and green taxonomy standards create investor certainty but also raise compliance complexity.
The United States takes a market-led approach with performance-based incentives, stimulating early SAF investment.
Asia-Pacific is mixed. Singapore and Japan are investing heavily in SAF R&D, while China explores domestic pathways using agri-residues and waste oils.

Global harmonization will matter as aviation remains cross-border. Differing regional incentives, definitions, and certifications must converge to prevent market fragmentation.

Investment Outlook: What to Watch

SAF is attracting attention from institutional investors, private equity, and infrastructure funds. However, risk appetite remains tied to regulatory clarity and long-term demand visibility.

Key investment signals to watch:

Offtake agreements with firm pricing
Co-investment from airlines and OEMs
Government-backed loan guarantees
Clear lifecycle GHG methodologies
Infrastructure buildout at major hubs

The winners in the SAF race will likely be those who can align technical feasibility, feedstock access, policy leverage, and investor confidence.

Cross-Sector Potential: Beyond Aviation

While SAF is designed for aircraft, its development ecosystem touches multiple industries. PtL facilities producing synthetic kerosene can also supply marine fuels and chemicals. Shared hydrogen infrastructure, renewable energy, and carbon capture systems create overlap with broader energy transition strategies.

Multi-use sites (e.g., integrated e-fuel hubs) could offer economies of scale and better risk distribution. Policymakers may increasingly favor such projects to accelerate infrastructure deployment.

Conclusion: Preparing for Scale

Sustainable Aviation Fuels are no longer a question of feasibility—they are a question of scale. The next five years will define whether SAF becomes a true bridge to net-zero aviation or remains a high-cost niche.

For executive decision-makers, the task is twofold:

Engage now in SAF through investment, partnerships, or offtake agreements.
Monitor infrastructure and policy signals to align with scalable, bankable projects.

InventU will continue to facilitate critical discussions between producers, carriers, regulators, and investors to accelerate this transition.

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