Global demand for sustainable aviation fuel (SAF) to explode by 2030

A new report from Boston Consulting Group shows that Sustainable Aviation Fuel demand could reach around 10 MTPA (million tonnes per annum) by 2030, although that number could be much higher depending on the path that will be flown in the coming years.

In the notoriously hard-to-abate aviation industry, Sustainable Aviation Fuel (SAF) could become a major part of the overall net-zero strategies set by many countries around the world. The aviation industry is the source of around 3% of all global carbon emissions and poses a significant challenge to the transition to sustainable energy.

The global demand for SAF is going to see significant growth in the decades to come, forecasted Boston Consulting Group, eventually comprising 12% of the global aviation energy demand by 2050. By 2030, SAF demand is expected to hit 10 MTPA, with significant potential for more.

A more accurate prediction is difficult said the authors, as there is lots of uncertainty around North American demand and potential SAF mandates from Asia Pacific.

One of the largest obstacles to cleaning up the aviation industry is that SAF is not yet being extensively produced and is not widely available. In 2023, SAF accounted for only 0.3% of global jet fuel production.

SAF derived from Hydrotreated Esters and Fatty Acids (HEFA) is currently one of the most promising paths to achieving a robust SAF supply, among many other feedstocks. The Boston Consulting Group report noted that HEFA SAF production capacity is ramping up fast and indeed could be sufficient to meet demand this decade, though new investment will be required in the coming years.

In addition to that, the scalability of HEFA SAF after 2030 will be limited by oil feedstock supply. Despite that, a number of solutions to that supply gap could emerge in the years to come. Another issue with this type of SAF is that the HEFA process does not score as high as other types of SAF in terms of sustainability.

“European mandates kicking-off in 2025 are expected to spark a period of long-term demand growth for Sustainable Aviation Fuels. However, key uncertainties – like US policy framework, voluntary willingness to pay, and Asian mandates – cloud the trajectory,” notes BCG.

“At the same time, rapid SAF capacity expansion has led to an overcapacity slump in 2024, suppressing prices and margins. We anticipate that demand will surpass capacity toward the end of the decade, restoring margins to reinvestment levels.”

There have been some significant advancements in the production of SAF, especially in Europe, where there has been considerable investment. For example, a €1.5 billion project to build the world’s largest SAF plant in Rotterdam will be able to produce over 250,000 tons of SAF annually – enough for 7,000 cross-Atlantic flights.