Global production of sustainable aviation fuels (SAF) continues to ramp up, the global representative body for the airline industry, the International Air Transport Association (IATA), has reported. But SAF production remains woefully inadequate and, ironically, government policies meant to stimulate the adoption of SAF are becoming an obstacle to the use of these fuels.

“While it is encouraging that SAF production is expected to double to two-million tons in 2025, that is just 0.7% of aviation’s total fuel needs,” pointed out IATA director-general Willie Walsh. “And even that relatively small amount will add $4.4-billion globally to the fuel bill. The pace of progress in ramping up production and gaining efficiencies to reduce costs must accelerate.”

The European continent is now the main market for SAF, following the activation of SAF mandates in both the UK and the EU on January 1. But the result has been the imposition of heavy compliance fees by SAF producers and suppliers. The result is that SAF in Europe this year would cost five times more than conventional jet fuel.

IATA expected one-million tons of SAF would be bought to meet the European mandates. At current market prices, that should cost $1.2-billion. But compliance charges will add another $1.7-billion on top of that, to take the total price to $2.9-billion. The money used to pay those compliance charges could be better used to abate a further 3.5-million tons of carbon emissions.

“This highlights the problem with the implementation of mandates before there are sufficient market conditions and before safeguards are in place against unreasonable market practices that raise the cost of decarbonisation,” he affirmed. “Raising the cost of the energy transition that is already estimated to be a staggering $4.7-trillion should not be the aim or the result of decarbonisation policies. Europe needs to realise that its approach is not working and find another way.”

IATA wants governments to create more effective policies, which will remove the disadvantages renewable-energy producers suffer, compared with the major oil companies, and allow the scaling up of renewable fuels in general and particularly of SAF. The association also desires that governments develop comprehensive energy policies that include SAF. And that they ensure the success of the intergovernmental Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).

IATA itself has been actively seeking to facilitate the adoption of SAF. It has created a SAF Registry, now managed by the specially-created Civil Aviation Decarbonisation Organisation, to provide a standardised and transparent system to track the purchase and usage of SAF, as well as the associated carbon emissions reductions. This registry is in compliance with CORSIA and with the EU Emissions Trading Scheme. IATA also set up the SAF Matchmaker, to connect airlines seeking to buy SAF with producers capable of supplying it.