Energy data group Argus has released an overview of how sustainable aviation fuel (SAF) regulations will increasingly impact aircraft operators. The report, “2025: The Year of SAF Mandates,” highlights the industry’s new obligations under the European Union’s ReFuelEU SAF mandate legislation and the emissions trading scheme (ETS), while also providing an update on policies in other regions of the world.
Under ReFuelEU, aviation fuel suppliers are required to provide minimum quantities of SAF with mandatory quotas rising progressively from 2029 and then quite steeply between 2049 and 2050 to account for around 80% of all fuel, including synthetic fuels. The UK’s SAF mandate is set to rise from 2% this year to 20% in 2040, with progressively tightening limits on the amount of fuel that can be produced from hydroprocessed esters and fatty acids.
Aircraft operators are now obligated to uplift at least 90% of their fuel requirements at EU airports for flights departing from those airports in a move intended to prevent fuel tankering. Most EU airports now face an obligation to facilitate the availability of SAF if their annual passenger throughput is above 800,000 or freight traffic exceeds 100,000 tonnes.
The Argus report explained that between Jan. 1, 2024, and Dec. 31, 2030, 20 million carbon allowances under the ETS will be set aside to incentivize the use of SAF. These allowances will cover all or part of the price differential between SAF and jet-A.
For most airports, the price differential covered will be 95% for renewable fuels of non-biological origin, falling to 70% for advanced biofuels and 50% for other eligible fuels. Smaller airports and those in the more remote regions of the EU will be able to cover the entire price differential.
Different Approaches around the World
The legislative landscape across the Asia-Pacific region, mapped out by Argus, shows more limited initiatives. For instance, China is working to a limited target of making 50,000 tonnes of SAF available annually between 2022 and 2025, while Indonesia and South Korea have set mandates of 1% through 2027, and Singapore is targeting 1% next year with a goal of achieving between 3% and 5% by 2030. SAF mandates are under discussion by governments in Australia, Malaysia, New Zealand, and Thailand.
In the U.S., for now, the main focus has been on incentivizing SAF usage with a target to supply 30 billion gallons by 2030 under the country’s SAF Grand Challenge. The Argus report details SAF credit schemes now available in Washington, Hawaii, Nebraska, Minnesota, and Illinois.
Argus, which tracks pricing and offers risk management tools, predicted that supplies of used cooking oil will serve as a feedstock for SAF. This is contingent on increased rates of the oil being collected worldwide, and it will also be in demand for the production of sustainable fuel for other industries.