Sustainable aviation fuel mandates lagging behind accelerating airline demand

With COP29 coming to a close, IBA, the leading aviation market intelligence and advisory company, has today forecast a growing divergence between mandated demand for Sustainable Aviation Fuel (SAF) and the demand based on larger airlines’ planned SAF use.

From around one million tonnes in 2024, IBA predicts that SAF production will grow substantially to 26.8 million metric tonnes (MT/yr) per year by 2030.

The Asia-Pacific (APAC) region is currently leading in SAF production capacity with approximately 1.5 million MT/yr, largely due to Neste's facility in Singapore. By 2025, Europe's capacity is projected to increase from 0.42 to 2.2 million MT/yr.

During this timeframe, the amount of mandated SAF demand – that which is set by anticipated demand from airlines due to government mandates on SAF use – is set to grow much more modestly from around 0.5 million metric tonnes to 4.1 million metric tonnes.

Target SAF demand, however, is forecast to grow more quickly, reflecting the more ambitious SAF targets set by airlines themselves which are now often around 10% of total jet fuel use.

As a result, IBA forecasts that the combined total mandated and target SAF demand will increase significantly, from approximately 1 million metric tonnes in 2024 to 19.1 metric tonnes by 2030, which is expected to remain well below the anticipated supply.

Jennifer Stanley, ESG manager at IBA, says: “Airline-led initiatives that exceed mandated minimums demonstrate a proactive, yet flexible approach to decarbonisation. This suggests that market-based measures will be essential for scaling SAF production and stimulating technology investments.”