IATA: 2024 SAF production “significantly below” previous estimates
December 10, 2024
Disappointingly low SAF production statistics for the full year 2024, highlighted by IATA, demonstrates the ongoing shortfall in SAF supply versus demand – with the association calling on three “critical ways” by which SAF production could be expanded.
“The airline industry’s decarbonisation must be seen as part of the global energy transition, not compartmentalised as a transport issue,” explained IATA’s senior vice president of sustainability and chief economist Marie Owens Thomsen. “That’s because solving the energy transition challenge for aviation will produce a broad range of fuels used by other industries, and only a minor share will be SAF, used by airlines”.
These plants – of which Airbus estimates between 3000 and 6,500 will be needed to reach net CO2 emissions by 2050 – will also produce fuels for other industries, including renewable diesel. Crucially, IATA estimates the average capital expenditure needed to build these over the ensuing three decades as “significantly less” (about 50 billion a year) less than the estimated total sum of investments in the solar and wind energy markets between 2004 and 2022.
However, with a number of mandates around the world set to take effect – including the UK’s requirement for 2% of total jet fuel demand from 2025 to be SAF – it’s long been understood that more needs to be done. IATA’s short-term strategies for elevated production include the increase of co-processing of approved renewable feedstocks alongside crude oil streams, diversifying SAF production pathways and creating a global SAF accounting framework.
IATA’s director general suggested that profitability expectations for SAF investors should be “slow and steady, not fast and furious;” highlighting that “governments are sending mixed signals to oil companies which continue to receive subsidiaries for their exploration and production of fossil oil and gas”. By winding down these subsidiaries and “replacing them with strategic production incentives and clear policies supporting a future built on renewable energies,” investors’ confidence in new fuel producers could be increased, he added.
