UK confirms SAF mandate from 2025

The UK government officially confirmed today that subject to parliamentary approval it will introduce a 2pc sustainable aviation fuel (SAF) mandate to start from 1 January 2025.

Obligated suppliers will have to deliver a 2pc share of SAF in 2025, increasing to 10pc in 2030, 15pc in 2035 and 22pc in 2040. The obligation will remain at 22pc from 2040 "until there is greater certainty regarding SAF supply", the government said.

Hydrotreated esters and fatty acids (HEFA) SAF can be used to meet 100pc of SAF demand in 2025 and 2026, but it will be capped at 71pc in 2030 and 35pc in 2040. HEFA is the most common type of SAF today, and is expected to account for over 70pc of global production by the end of the decade, according to Argus data.

An obligation for Power-to-Liquid (PtL) SAF will be introduced from 2028 at 0.2pc of total jet fuel demand, rising to 0.5pc in 2030 and 3.5pc in 2040. The EU is targeting a 1.2pc share of synthetic aviation fuels in 2030, rising to 2pc in 2032, 5pc in 2035 and 35pc in 2050.

Buy-out mechanisms will be set at the equivalent of £4.70/l and £5.00/l for the main and PtL obligations, respectively.

The government said it will work to create feedstock availability and ensure it is used in a sustainable and productive way.

UK also confirmed on 17 July that it will introduce the Sustainable Aviation Fuel (Revenue Support Mechanism) bill to support SAF production. It said it estimates that SAF production will add £1.8bn ($2.3bn) to the economy and create over 10,000 jobs. The government previously said it aims to introduce the mechanism, which will be industry funded, by the end of 2026.

An EU-wide SAF mandate — ReFuelEU — comes into effect next year, replacing national obligations. Under the mandate, fuel suppliers will need to include 2pc SAF in their jet fuel deliveries in 2025, rising to 6pc in 2030, 20pc in 2035, 34pc in 2040, 42pc in 2045 and 70pc in 2050. Jet fuel demand in the EU was around 950,000 b/d last year, Energy Institute data show, meaning that SAF requirements next year could be nearly 20,000 b/d.

In the longer term, EU and UK mandates could push SAF consumption in Europe to nearly 20pc of total aviation fuel consumption by 2035 and 60pc by 2050, figures from Argus Consulting show. Globally, SAF will make up nearly 4pc of total jet fuel consumption globally by 2035, and 12.5pc by 2050.

By Evelina Lungu