Sustainable Aviation Fuel Market Size, Share, Industry, Forecast and outlook (2024-2031)

Global Sustainable Aviation Fuel Market is Segmented By Type (Biofuel, Hydrogen Fuel, Power-to-Liquid Fuel, Gas-to-Liquid Fuel), By Aircraft Type (Fixed Wing, Rotary Wing), By Platform (Commercial Aviation, Military Aviation, Business Aviation, Unmanned Aerial Vehicles (UAVs)), and By Region (North America, Europe, South America, Asia Pacific, Middle East, and Africa) – Share, Size, Outlook, and Opportunity Analysis, 2024-2031

Sustainable Aviation Fuel Market Size

Global Sustainable Aviation Fuel Market reached USD 320.8 million in 2022 and is expected to reach USD 3,581.0 million by 2030, growing with a CAGR of 35.2% during the forecast period 2024-2031. During the forecast period, new technological advances in fuel production are likely to augment the growth of the global sustainable aviation fuel market.

New feedstock materials and process advances are likely to significantly bring down production costs, thus making sustainable fuel an attractive alternative for airlines instead of conventional jet fuel. 

Emerging countries are entering into collaborative partnerships with multinational companies to expand and adopt sustainable aviation fuel. For instance, in April 2023, Indian Oil, India’s state-owned oil and gas producer, signed an agreement with U.S.-based company LanzaJet to produce sustainable aviation fuel at the company’s refinery in Panipat, Haryana, India.  

Market Summary

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Market Dynamics

Increasing Drive For Decarbonization Of Transportation

With rising awareness of the ill-effects of man-induced climate change and global warming, efforts are being undertaken for decarbonization of transportation. Although decarbonization of road transportation is well underway, with rising adoption of electric vehicles (EVs), the decarbonization of aviation represents a major challenge. 

Although fully electric aircraft are still years away from commercial adoption, the adoption of sustainable aviation fuel is a readily available measure that can be undertaken to reduce emissions, since it requires very little modification to existing infrastructure. Data from the U.S. department of energy (DoE) estimates that fully switching to sustainable fuel can help to cut emissions by upto 94%. The increasing drive towards decarbonization will augment demand for sustainable aviation fuel during the forecast period. 

Increasing Industrial Collaboration

Collaboration among the leading stakeholders of the global aviation industry, including aircraft manufacturers, airline companies and regulatory bodies has increased in recent years with a  view towards the increasing the sustainability of the industry. The International Civil Aviation Organization (ICAO) has established the Sustainable Aviation Fuel Users Group (SAFUG), a industry body to promote and lobby for regulatory changes to support adoption of sustainable aviation fuel. 

Collaboration between the various major industrial players also enables the establishment of industry standards and certifications for sustainable aviation fuel. For instance, biofuel is already certified for used in commercial civil aviation by ASTM International. New regulatory standards are being developed to keep up with advancements in the industry.

Limited Production Capacity

Sustainable fuel production is a highly capital-intensive business that requires significant investment in setting up production, storage, and distribution infrastructure. It requires the usage of dedicated refineries or conversion units.

Due to the high costs involved, many companies do not undertake sustainable fuel production. Volatility in feedstock availability is another factor limiting the production of sustainable aviation fuel. A limited production capacity leads to higher costs per unit of fuel produced, making it uncompetitive against conventional fuels and thus reducing its adoption.  

Market Segment Analysis

The global sustainable aviation fuel market is segmented based on type, aircraft type, platform and region.

Easy Feedstock Availability and Certification Makes Biofuel a Preferred Sustainable Aviation Fuel

Biofuels are the most widely used sustainable aviation fuel, accounting for more than half of the global market. Biofuels, have been extensively researched and used in automobiles and thus require minimum modification for aviation applications. Furthermore, the adoption of biofuels does not require significant modifications to existing infrastructure, making it an attractive choice for airlines. 

Biofuels are mainly manufactured from readily available feedstock materials such as agricultural residue and plant-based oils. The ready availability of feedstock ensures a consistent and steady supply, thus ensuring continued and uninterrupted biofuel production. Furthermore, biofuels are already approved for use in aviation applications under ASTM International standards. 

Market Geographical Share

North America is Expected to Have the Largest Market Share

North America is expected to account for roughly half of the global market and is expected to have a higher CAGR growth rate of nearly 38.2% during the forecast period. U.S. is the largest aviation market globally, with nearly 853 million passengers carried and nearly 5,800 commercial aircraft in service in 2022. The large size of the U.S. market presents ideal opportunities for the adoption of sustainable aviation fuel. 

According to data from the industry magazine Airline Weekly, U.S.-based United Airlines was the biggest utilizer of sustainable aviation fuel, with a commitment towards 100% reduction in greenhouse gas emissions by 2050. United airlines has signed a purchase agreement with fuel producer Neste for sustainable aviation fuel in May 2022. 

In September 2022, the U.S. department of energy (DoE) unveiled a plan detailing the U.S. government strategy for expanding the production and usage of sustainable aviation fuel over the coming years. The U.S. government plans to supply nearly 3 billion gallons of sustainable aviation fuel to airlines annually by 2030, with plans to cover 100% of commercial aviation demand by 2050.  

Market Companies

The major global players include Neste, Fulcrum BioEnergy, LanzaTech, TotalEnergies, Gevo, SG Preston, Velocys plc, Northwest Advanced Bio-Fuels,LLC, Red Rock Biofuels and Prometheus Fuels.

COVID-19 Impact on Market

The COVID-19 pandemic created significant challenges for the global sustainable aviation fuel market. With a few exceptions, the global aviation industry witnessed a complete downturn, which disrupted research and development into sustainable fuels. A drastic reduction in global oil prices further discourage adoption of sustainable aviation fuels. 

In the aftermath of the pandemic, governments are implementing various stimulus policies to overcome the economic downturn caused by the pandemic. Green technologies are a particular area of focus. With increasing policy support, the global market is likely to witness significant growth in the post-pandemic period. 

Russia- Ukraine War Impact Analysis

The Russia-Ukraine war will not directly impact the global market at large. Russia had not undertaken significant development of sustainable aviation fuel due to the easy availability of conventional fuel. Furthermore, sanctions imposed upon Russia have cutoff access to western technology, further complicating the development of sustainable aviation fuels. Although Russia is making strides towards indigenous development, it is still likely to account for an insignificant share of the global market.  

By Type

• Fixed Wing
• Rotary Wing

By Aircraft Type

• Biofuel
• Hydrogen Fuel
• Power-to-Liquid Fuel
• Gas-to-Liquid Fuel

By Platform

• Commercial Aviation
• Military Aviation
• Business Aviation
• Unmanned Aerial Vehicles (UAVs)

By Region

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Rest of Europe
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • Rest of Asia-Pacific
• Middle East and Africa

Key Developments

• In July 2023, Willis Lease Finance Corporation, a U.S.-based aircraft leaser, announced plans to develop power-to-liquid sustainable aviation fuel at its upcoming refinery in northeastern England.
• In July 2023, Australia’s Renewable Energy Agency (ARENA) announced plans to invest USD 30 million to develop a domestic sustainable aviation fuel industry based on production from agricultural feedstocks.
• In July 2023, Twelve, a U.S.-based sustainable fuel startup, broke ground on its new facility for commercial production of sustainable aviation fuel in Moses Lake,Washington, U.S.

Why Purchase the Report?

• To visualize the global sustainable aviation fuel market segmentation based on type, aircraft type, platform and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of sustainable aviation fuel market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as Excel consisting of key products of all the major players.

The global sustainable aviation fuel market report would provide approximately 57 tables, 58 figures and 185 Pages.

Target Audience 2024

• Aviation Fuel Producers
• Aircraft Manufacturers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies