Global Sustainable Aviation Fuel Market Set to Surpass $82 Billion Annually by 2035, says Report

As concerns about climate change continue to grow, the aviation industry is under increasing pressure to reduce its greenhouse gas (GHG) emissions. Prior to the COVID-19 pandemic, commercial aviation accounted for over 2 percent of global GHG emissions. Now, with the industry slowly recovering, stakeholders are looking for ways to reduce their carbon footprint. One promising solution is sustainable aviation fuel (SAF), also known as sustainable drop-in fuel.

According to a new report from , the global SAF market is set to grow significantly in the coming years, with revenue surpassing $82 billion annually by 2035. This growth is expected to be driven by technology maturity and market mandates.

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“SAF use typically generates 60 percent to 95 percent fewer GHG emissions compared with a fossil fuel reference value of 89 grams of CO2 equivalent per megajoule,” said , analyst with Guidehouse Insights. “Additionally, SAF has been tested in long-haul flights and can be incorporated into existing fuel and engines without costly modifications.”

The market for SAF is being driven by multiple forces, including government policies and corporate initiatives. The 's ReFuelEU proposal, for example, would set an SAF target of 63 percent market share by 2050, while the US SAF Grand Challenge aims for 3 billion gallons of SAF production per year by 2030. Corporate environmental, social, and governance initiatives are also playing a role in creating market demand for SAF.

However, there are significant challenges that must be addressed. SAF production is considerably more expensive than conventional jet fuel production, with costs ranging from 2 to 10 times higher. A substantial component of this cost is tied to the immature distribution system for SAF.

Despite these challenges, the potential benefits of SAF are clear. The report from Guidehouse Insights provides an assessment of the current and future SAF market, including an overview of the market drivers and challenges, key industry players, and production outlook through 2035. The outlook is provided for major world regions across all nine ASTM-certified SAF production processes.

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As the aviation industry continues to recover from the COVID-19 pandemic, it is crucial that stakeholders prioritize sustainable solutions. SAF represents a promising solution to reduce the industry's carbon footprint, and with the right policies and incentives in place, the market for SAF is set to grow significantly in the coming years.

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