Is The Fuel Crisis A Catalyst For Europe’s SAF Supply?

Europe’s sustainable aviation fuel industry might be at a turning point. Key environmental legislation for aviation is in the spotlight against the backdrop of the Iran conflict and the related fuel crisis, which could be a much-needed catalyst for the lagging industry.

Oil price spikes and fears of jet fuel shortages are causing not only short-term problems, such as reroutings and cancellations for European airlines, but they are also highlighting how dependent the region’s airlines are on fossil fuels from the Middle East.

• Airlines say 2030 e-SAF targets will have to be pushed back

• Fuel producers call mandates vital to their projects

The crisis could provide a unique catalyst for the fledgling SAF sector, helping to reduce that dependence and facilitating airlines move closer to their decarbonization goals. It could also enable airlines to meet their sustainability targets and make progress toward decarbonizing their operations.

“In the longer-term, everybody now understands that we need to invest in sustainable and local fuel solutions that reduce the dependence on fossil fuel and on the Middle East,” Alexander Küper, managing director of consultancy Blue Sky Aviation Fuel (BSAF) and a former vice president of renewable aviation at Neste, tells Aviation Week.

“Even people that would deny there is man-made climate change would agree we need to invest in SAF and local fuel production,” he says. “So I think that’s a very positive momentum.”

For airlines in the region, SAF supply—or more specifically, the lack of e-SAF supply—is a big concern. ReFuelEU Aviation SAF mandates came into force last year, requiring an initial 2% SAF uplift at all European airports. The percentage is set to rise in steps to 70% in 2030; e-SAF submandates start at 1.2% in 2030.

Production capacity at some biomass-based SAF facilities in Europe, such as Neste’s refinery in Rotterdam, Netherlands, is growing. The Finnish company said in its latest annual report that SAF production capability had reached 1.5 million tons per annum and would grow to 2.2 million in 2027. But widescale e-SAF production is far from a reality.

Major European aviation sustainability policy milestones are approaching in the coming months, including a review of the Emissions Trading System and Carbon Offsetting and Reduction Scheme for International Aviation (Corsia) assessment; a new EU Aviation Strategy set to be released in the third quarter; the Sustainable Transport Investment Plan (STIP), which should focus heavily on SAF ramp-up; and a planned review of ReFuelEU Aviation next year. These could provide some clarity on how Europe plans to better support the SAF sector

While European airlines represented by Airlines For Europe (A4E) last year voiced concerns about the 2030 target of 6%, they now acknowledge that amount should be achievable—at a price (AW&ST April 7-20, 2025, p. 57). But they say the real problem for the sector is the lack of progress on e-SAF production.

At its annual summit in Brussels in March, A4E said the mandates imposing the use of e-SAF should be delayed because not enough projects to produce the e-fuels have been approved for investment, which would allow the necessary volumes to be available by 2030.

“The 2030 e-SAF submandate must be postponed until e-SAF is sufficiently available and affordable and the regulatory framework is redesigned to support diverse, affordable production pathways,” A4E said.

“The reality is, it won’t be there, and you can see it won’t be there,” EasyJet CEO Kenton Jarvis said at the event. “You would have to have multiple plants that had reached an investment decision. They need to be built, then production needs to be scaled up, and then they need to get distribution. So you can tell today that it will not happen by 2030.”

The association said projects that had passed the final investment decision (FID) stage account for just 0.71% of the 600 kilotons of e-SAF that would be needed in 2030 to meet the target. This shortage could lead to penalties of €7-9 billion ($8.2-11 billion) and increase ticket prices and costs for airlines, resulting in a lose-lose scenario.

Even European Commissioner for Sustainable Transport and Tourism Apostolos Tzitzikostas acknowledged at the event that SAF remains expensive. “Supply is still limited, and the business case, if we want to be very honest, remains difficult,” Tzitzikostas said. However, he stressed that the commission remains fully committed to both the overall SAF and e-SAF mandates.

As airlines in Europe call for SAF targets to be pushed back, other voices in the industry note that changing the mandates would undermine the stability and investment certainty they were designed to provide for potential investors.

Unsurprisingly, fuel producers see the mandates as a vital scaffolding on which to build their nascent projects.

In reaction to the A4E calls, Arcadia eFuels CEO Amy Hebert said: “Without the ReFuel-EU e-SAF submandate, there will be no e-SAF market and no pathway to lower fuel costs. Early cost reduction in e-SAF is driven by policy, not scale. The certainty provided by ReFuelEU is single-handedly what allows us to access public support, secure offtake agreements and move projects forward. Without that, the development and production of e-SAF are at great risk of not materializing.”

For Küper, pushing back mandates would undermine them completely. “The good thing about a mandate is it’s stable; you can rely on it,” Küper said.

“If you take that away, the whole thing falls apart,” he added. “I think it can really kill the industry. I don’t think airlines are doing themselves any favors by saying the mandate should be removed.”

However, he recognizes that with no projects for e-SAF at FID in Europe, some flexibility in the system might be required.

“This is where the system is broken,” Küper said. “There is not enough traction there, and if there isn’t any e-SAF production by 2027, at some point we will have to discuss the mandate, such as by adding flexibility–whatever you don’t do in 2030 you do in 2032, or replace it by advanced biofuels. There’ll need to be some mechanism, because you can’t urge people to buy something that isn’t there.” Tax credits could also be a “game changer,” Küper added.

While short-term solutions to support the industry through the current fuel crisis are understandably monopolizing attention, Küper said the shock will prove to be a longer-term driver for SAF activities in Europe.

“If you’re a SAF producer, it’s very difficult now to talk to people who are panicking about whether they will have enough fuel,” he said. “But once that gets solved, I think everybody will double their efforts in looking at alternatives and how to ramp up and support the buildup of SAF.”