Market Overview:

The market for Sustainable Aviation Fuel was valued at approximately USD 1.1 Billion in 2023. Over the course of the forecast period (2024–2031), the market is expected to develop at a compound annual growth rate (CAGR) of 47.7%, reaching a value of USD 19.04 Billion by 2031 according to a new report by IMIR Market Research.

The production of environmental concerns, government assistance, and the increasing demand for clean, renewable energy sources in the military & commercial aviation sectors are expected to drive market growth in the future years. The market for sustainable aviation fuel (SAF) in the US is anticipated to expand due to rising consumer demand for eco-friendly goods, legislative initiatives, technological developments, and rising environmental consciousness. Sustainable fuel offers high viscosity as well as elevated density in the aviation industry. They consist of a wide range of energy sources & carriers derived from feedstocks with low or renewable carbon content.

The U.S. SAF market is expected to grow in the upcoming years due to the increasing demand for sustainable aircraft solutions, advancements in sustainable aviation fuel, and increasing economies of scale. Furthermore, in the global market for sustainable aviation fuel, a number of businesses and governmental organizations are actively leading the way in novel manufacturing techniques.

The growth is expected to be further propelled over the projection period by the rising involvement of other organizations and the U.S. Department of Energy's Bioenergy Technologies department. For instance, in September 2021, the government and the U.S. Department of Agriculture (USDA) together launched the Sustainable Aviation Fuels Grand Challenge with the goal of encouraging the production of sustainable aviation fuels to reach approximately 3 billion gallons annually by 2030.

Market Dynamics:

Market Drivers-

Environmental Regulations and Emissions Reduction Goals

• The market for sustainable aviation fuel is being driven by governments & international organizations' increasingly strict environmental rules and emission reduction targets. A major source of greenhouse gas emissions, mostly carbon dioxide (CO2), which fuels global warming and climate change, is aviation. Global regulatory bodies are taking action in response, putting policies in place to lessen aviation's negative environmental effects and cut lower the emissions of carbon from aircraft operations. The above measures include establishing carbon pricing mechanisms, imposing emission reduction objectives, and using policy tools including mandates, tax breaks, and subsidies to encourage the use of environmentally friendly aviation fuels (SAF). In order to decarbonize the aviation sector and meet sustainability targets outlined in global accords like the Paris Agreement and the global community Civil Aviation Organization's (ICAO) Carbon Offsetting or Reduction Diagram for International Aviation (CORSIA), governments and stakeholders in the aviation industry are realizing more and more how important it is to make the switch to low-carbon and renewable fuel sources. Due to the need to lessen aviation's environmental impact and to comply with regulations, there is an increasing demand for SAF as an alternative to conventional jet fuel.

Corporate Sustainability Initiatives and Stakeholder Pressure

• The growing adoption of corporate sustainability programs and opposition from airlines, airports, aircraft manufacturers, and other industry stakeholders are driving the sustainable aviation fuel market. Companies in the aviation sector are under increasing pressure from investors, consumers, and regulatory bodies to address their carbon emissions and ecological effects as knowledge of climate change and sustainability issues rises. A lot of airlines and aviation companies have made commitments to ESG (environmental, social, and governance) and corporate social responsibility, or CSR, strategies that include lofty sustainability targets like net-zero emissions, carbon neutrality, and the adoption of sustainable fuels. A practical way for aviation sector participants to lessen their carbon footprint and show advancement toward sustainability objectives is through the use of sustainable aviation fuel. To increase SAF production and distribution, airlines are blending more and more SAF into their fuel mixes, operating SAF-powered aircraft, and working with biofuel manufacturers, oil refiners, & renewable energy organizations. Furthermore, in order to hasten the adoption of SAF and spur market expansion, industry coalitions and initiatives like the Clean Skies for Tomorrow Coalition and the Sustainable Aviation Fuel Users Group (SAFUG) are pushing for legislative backing and financial incentives. The Sustainable Aviation Fuel Market is gaining momentum and investment due to the integration of corporate sustainability objectives with stakeholder expectations & the demand for low-carbon aviation fuels.

Market Trends-

Increasing Production Capacity and Investment in Biofuel Refineries

• The growing production capacity and investments in biofuel refineries devoted to SAF production are driving the Sustainable Aviation Fuel Market. Biofuel producers and energy corporations are increasing their production capacity & investing in new or updated biofuel refineries to fulfill market demand as the demand for environmentally friendly aviation fuels rises.  The efficiency, yield, and the standard of SAF production are increasing due to developments in biofuel processing technologies including hydrotreating, hydrocracking, & Fischer-Tropsch synthesis. This allows producers to attain cost competitiveness and scalability. Furthermore, investment in SAF supply chains and infrastructure, including as feedstock procurement, logistics, and distribution networks, is being made easier by strategic alliances and collaborations among biofuel producers, airlines, governments, or financial institutions. The market is expanding and a stable and long-term supply of aviation biofuels is being ensured to meet the increasing demand from airlines and the aviation stakeholders. This is being achieved by the increase of SAF production capacity and also the diversification of feedstock sources.

Emergence of Sustainable Aviation Fuel Blending and Offtake Agreements

• The development of environmentally friendly aviation fuel offtake and blend agreements between airlines and biofuel producers is known as the "sustainable aviation fuel market." Due to stakeholder pressure, corporate sustainability objectives, and regulatory compliance requirements, airlines are progressively blending SAF into their fuel mixes to help them meet sustainability targets and reduce their carbon footprint.  A blended fuel that satisfies industry standards and performance requirements is made by blending different amounts of sustainable aviation fuel (SAF) with traditional jet fuel (Jet A or Jet A-1). To ensure a steady supply of SAF for their operations, airlines are entering into long-term purchase contracts with biofuel producers. Under these agreements, the airlines pledge to buying a specific amount of biofuel at predetermined costs over an extended period of time.  The financial stability and market visibility that biofuel producers require to invest in SAF output and expand their businesses are given by these offtake agreements. To further encourage the use of sustainable fuels, airlines are looking into cutting-edge funding options like voluntary carbon markets, carbon offset programs, and renewable energy credits (RECs). A more environmentally friendly and low-carbon future is being ushered in by the aviation sector, which is reflected in the move toward sustainable aviation fuel blending & offtake agreements.

Market Restraining Factors-

Higher Expenses Associated

• The cost of environmentally friendly aviation fuel is one of the primary problems the sector is now facing. Presently, the cost of environmentally friendly aviation fuel is between four and five times more than that of ordinary jet fuel. Therefore, rather than buying sustainable aviation fuel in bulk, a few airlines would choose to buy something different. As a result, very little sustainable aviation fuel is produced worldwide. Reducing the price of environmentally conscious aviation fuel is necessary for scaling up. Among other crucial factors, feedstock costs, productivity, and plant capital recovery raise the cost of sustainable aviation fuel.
• Furthermore, fats, oils, & greases are utilized as feedstock for environmentally friendly aviation fuel, which isn't readily available in large enough quantities to satisfy demand for it. The cost of sustainable aviation fuel is rising as a result. Moreover, airlines pass on the relative cost to customers by increasing ticket prices when they mix sustainable aviation fuel with jet fuel.

Segmentation Analysis:

The market is divided into segments based on By Fuel Type, By Technology, By Platform.

By Platform

Based on the Platform of the market is segmented into Commercial, Regional Transport Aircraft, Military Aviation, Business & General Aviation, Unmanned Aerial Vehicles.

In 2022, the commercial sector held the highest revenue share, accounting for about 30.0% of the total. The market for sustainable aviation fuel in the commercial aviation industry has been growing steadily due to a confluence of industry initiatives, regulatory requirements, and environmental concerns. It is anticipated that as public knowledge of environmental issues and climate change grows, so will the adoption of environmentally friendly methods.

Smaller passenger aircraft and turboprop aircraft used for shorter routes are among the driving forces that contribute to the expansion of the regional transport plane sector in the SAF market. Governments and international flight organizations have set emissions reduction objectives and environmental regulations, which are expected to stimulate the industry in the coming years.

By Fuel Type

Based on the Fuel Type of the market is segmented into Biofuel, Hydrogen Fuel, Power to Liquid Fuel, Gas-to-Liquid.

In 2022, the biofuel segment held a dominant position with a revenue share above 76.0%. Direct or indirect processes using biomass, such as plant matter & animal waste, are utilized to produce biofuels. Charcoal, animal dung, and fuelwood are examples of traditional natural biomass that make up nearly all of the raw materials used in the manufacturing of biofuels. Increasing focus on sustainable environmental practices, reducing greenhouse gas emissions, and renewable energy sources are some of the factors propelling the growth of the biofuels industry.

Additionally, it is anticipated that the increasing number of environmentally concerned consumers will accelerate the uptake of products and cars that run on biofuels. Demand for biofuels drives their use and production growth. It is anticipated that the biofuels sector would expand due to both technology breakthroughs and a change in consumer preferences toward renewable energy sources. Future years are expected to see further growth in the biofuels business due to these development drivers.

Regional Snapshots:

By region, Insights into the markets in North America, Europe, Asia-Pacific, and the rest of the world are provided by the study. North America dominated the region in 2022 with a market share of more than 44.0%. Countries such as the US and Canada are prioritizing a variety of efforts aimed at using renewable aviation fuel to fulfill the growing demand for reduced carbon footprints resulting from greater air traffic & passenger numbers. North America is expected to increase significantly due to the presence of centers for sustainable aviation fuel, supportive legislation, and measures to reduce aviation emissions.

Asia Pacific is expected to grow at a significant compound annual growth rate (CAGR) in the future years due to the aviation industry's commitment to reducing emissions of greenhouse gases, environmental concerns, and the growing emphasis on sustainability. The rapid infrastructure development in emerging nations and the rise of low-cost carriers are expected to drive up the usage of environmentally friendly fuel in the Asia Pacific airline industry. Furthermore, increasing both private and public investment in emerging countries' aviation infrastructure would facilitate market expansion over the duration of the forecast period.

List of Companies Profiled:

• Aemetis Inc.
• AVFUEL CORPORATION
• Fulcrum BioEnergy
• Gevo
• TotalEnergies
• LanzaTech
• Neste
• Preem AB
• Sasol Limited
• SkyNRG B.V.
• World Energy, LLC

Key Industry Developments:

• In Febuary2023, Boeing has committed to buying mixed sustainable aviation fuel (SAF) by Neste, the largest producer of SAF globally, for use in supporting its commercial operations in the United States through 2023, totaling 5.6 million gallons (21.2 million liters). With these agreements, the company's purchases of sustainable aviation fuel have increased dramatically from the previous year.

Report Coverage:

The report will cover the qualitative and quantitative data on the global Sustainable Aviation Fuel Market. The qualitative data includes latest trends, market players analysis, market drivers, market opportunity, and many others. Also, the report quantitative data includes market size for every region, country, and segments according to your requirements. We can also provide customize report in every industry vertical.

Report Scope and Segmentations:

Sustainable Aviation Fuel Market Report is also available for below Regions and Country Please Ask for that

North America

• U.S.
• Canada

Europe

• Switzerland
• Belgium
• Germany
• France
• U.K.
• Italy
• Spain
• Sweden
• Netherland
• Turkey
• Rest of Europe

Asia-Pacific

• India
• Australia
• Philippines
• Singapore
• South Korea
• Japan
• China
• Malaysia
• Thailand
• Indonesia
• Rest Of APAC

Latin America

• Mexico
• Argentina
• Peru
• Colombia
• Brazil
• Rest of South America

Middle East and Africa

• Saudi Arabia
• UAE
• Egypt
• South Africa
• Rest Of MEA

Points Covered in the Report:

• The points that are discussed within the report are the major market players that are involved in the market such as market players, raw material suppliers, equipment suppliers, end users, traders, distributors and etc.
• The complete profile of the companies is mentioned. And the capacity, production, price, revenue, cost, gross, gross margin, sales volume, sales revenue, consumption, growth rate, import, export, supply, future strategies, and the technological developments that they are making are also included within the report. This report analysed 12 years data history and forecast.
• The growth factors of the market are discussed in detail wherein the different end users of the market are explained in detail.
• Data and information by market player, by region, by type, by application and etc., and custom research can be added according to specific requirements.
• The report contains the SWOT analysis of the market. Finally, the report contains the conclusion part where the opinions of the industrial experts are included.

Key Reasons to Purchase:

• To gain insightful analyses of the Sustainable Aviation Fuel market and have comprehensive understanding of the global market and its commercial landscape.
• Assess the production processes, major issues, and solutions to mitigate the development risk.
• To understand the most affecting driving and restraining forces in the market and its impact in the global market.
• Learn about the Sustainable Aviation Fuel market strategies that are being adopted by leading respective organizations.
• To understand the future outlook and prospects for the Sustainable Aviation Fuel market. Besides the standard structure reports, we also provide custom research according to specific requirements.

Research Scope of Sustainable Aviation Fuel Market:

• Historic year: 2018-2022
• Base year: 2023
• Forecast: 2024 to 2031
• Representation of Market revenue in USD Million