Airline industry's green goals in jeopardy as IATA blames fuel producers for SAF shortfall

The global airline industry is facing a significant setback in its environmental goals, with the International Air Transport Association (IATA) announcing on Tuesday that the sector is expected to fall short of its crucial targets for the adoption of sustainable aviation fuel (SAF) in the immediate years ahead. 

This disappointing prognosis, according to the major airline body, stems primarily from a failure on the part of fuel producers to scale up supply and what it perceives as inadequate or counterproductive regulatory frameworks.

IATA's statement underscores a deepening concern across the industry that the transition to greener operations is moving too slowly. 

The widespread adoption of SAF is considered the most vital tool for the airline sector to achieve its ambitious goal of net-zero carbon emissions by 2050. 

However, the current pace of progress is deemed "disappointing," jeopardising the industry’s mid-term objectives.

Production capacity and economic hurdles

The central problem remains the lack of adequate production capacity for SAF. 

While airlines are increasingly willing to commit to purchasing the more environmentally friendly fuel, producers have struggled to secure the necessary investment to build and operate large-scale refining facilities. 

Furthermore, IATA criticised the fragmented and often punitive regulatory approach being taken by various global governments, according to a Reuters report. 

SAF offers a substantial pathway to decarbonising the aviation sector, primarily by utilising feedstocks like waste materials and used cooking oil. 

Compared to conventional jet fuel, SAF can drastically reduce lifecycle greenhouse gas emissions. 

However, its widespread adoption faces significant economic hurdles. Currently, SAF is two to five times pricier than traditional fuel, a cost differential that aircraft operators are hesitant to absorb. 

This high cost is a major barrier to scaling up production and utilisation, necessitating policy support, technological advancements, and increased investment to bring SAF costs down to a competitive level.

Insufficient growth and industry frustration

IATA projects 2.4 million metric tons of SAF will be available in 2026, meeting only 0.8% of total fuel needs. 

The aviation industry aims for net-zero emissions by 2050, primarily through the switch to SAF, a commitment made in 2021.

"We're not seeing SAF produced in the volumes we had hoped for and had expected. That is disappointing," the trade group's director general Willie Walsh was quoted in the Reuters report. 

He had previously warned that the 2050 net zero goal could be at risk.

To meet its emissions targets, the aviation sector urgently needs to boost the production of SAF. 

Currently, SAF constitutes only about 0.3% of global jet fuel consumption, a figure IATA data projects to rise to just 0.7% by 2025.

Experts stress that this growth rate is insufficient.

Airlines have consistently stated their readiness to purchase all available SAF. However, they criticise jet fuel manufacturers, alleging that they are deliberately keeping prices high and not producing sufficient quantities of the more environmentally friendly fuel.

Walsh said:

He also mentioned his belief that numerous airlines would retract their official sustainability commitments in 2026. 

He pointed to Air New Zealand as the pioneer in establishing more achievable targets, setting an example for the industry.