Sustainable Aviation Fuel Market Size

Sustainable Aviation Fuel Market Size

Sustainable Aviation Fuel Market was valued at USD 952.6 million in 2023 and is estimated to register a CAGR of over 45% between 2024 & 2032 owing to the escalating corporate sustainability initiatives. Many airlines and aviation companies are increasingly adopting sustainability as a core element of their corporate strategies. For instance, the aviation industry's pursuit of achieving net-zero carbon emissions by 2050 considers sustainable aviation fuel (SAF) a pivotal facilitator. GE Aerospace reported that it has conducted tests on 10 distinct engines produced by itself and its joint ventures, exclusively using 100 percent SAF since 2016. In the latest trial in November 2023, an Emirates A380 showcased the use of pure SAF in one of its four Engine Alliance GP7200 powerplants during a demonstration flight departing from Dubai. Simultaneously, the remaining three engines operated on conventional jet fuel.

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Sustainability initiatives, including the use of sustainable aviation fuels, help these companies align with growing consumer preferences for environmentally responsible practices. As more companies commit to sustainability goals and seek to achieve carbon neutrality, the demand for sustainable aviation fuel is expected to rise.
 

Technological innovations and investments will play a key role in defining the SAF market outlook. Ongoing R&D efforts, in line with increased investments in sustainable aviation fuel production technologies, have been driving advancements in the sector. Quoting an instance, in December 2023, in a seed funding round, Metafuels, a start-up focused on sustainable aviation fuel, successfully raised $8 million. This Swiss climate tech company is dedicated to creating cleaner fuels compatible with current aircraft technology. The funding was led by Energy Impact Partners and Contrarian Ventures. Metafuels' sustainable aviation fuel, known as "aerobrew," is produced by transforming green methanol into electro-sustainable aviation fuel (eSAF).
 

Financial incentives, tax credits, and regulatory frameworks encouraging the aviation industry to invest in sustainable practices are expected to drive increased demand for SAF. Such measures can act as catalysts, fostering innovation and accelerating the transition towards a more sustainable and environmentally conscious aviation sector.
 

However, the cost disparity between SAF and conventional jet fuels could significantly impact the SAF industry. Producing SAF can be more expensive due to factors such as feedstock costs, production technology, and economies of scale. The aviation industry has been hesitant to embrace SAF on a large scale, primarily due to concerns about economic viability and the potential impact on ticket prices.