Additional £63 million of funding for UK SAF development

January 29, 2025

Alongside the UK government’s announcement earlier today that is to support a potential third runway at London Heathrow, the Department for Transport (DfT) is to provide £63 million of additional funding to support domestic SAF production – a move seen by many as critical to balancing aviation’s expansion with its environmental obligations.
Potential SAF producers will be able to apply for a one-year extension to the UK’s Advanced Fuels Fund, first launched in 2022 and described by the DfT as an important initiative in helping scale UK SAF production: mitigating risk by providing grant funding to first-of-a-kind commercial and demonstration-scale projects in the UK.
“The investment follows the SAF mandate having recently come into force earlier this month, and the Government’s commitment to introduce a Revenue Certainty Mechanism to support producers,” concluded the DfT.
£165 million was initially made available to the first five winners through the Advanced Fuels Fund’s inaugural round, designed to help deliver the government’s commitment to having “at least five commercial scale SAF plants under construction in the UK by 2025”. Eleven months later, in November 2023, a further nine successful recipients were announced for the second funding round, with £135 million allocated to support UK projects.
In April 2024, the DfT estimated that by 2035, the SAF sector could generate a gross value added of up to £1.8 billion a year for the national economy whilst supporting up to 10,000 jobs.
Welcoming the “strong recognition from the Chancellor of aviation’s unique role enabling economic growth in all parts of the UK,” CEO of Airlines UK Tim Alderslade recognised the need for airport capacity expansion to be “compatible with… net zero commitments.” Although stating that airlines are nevertheless making progress towards net zero, “the industry now needs Government help to align any additional capacity with further policy support to incentive the production of SAF,” he concluded.