The aviation industry faced setbacks in the production of sustainable aviation fuel during 2025. Production of SAF doubled between 2024 and 2025 but has not grown at the same rate since. Volumes did not reach the levels that stakeholders had anticipated. Commitments made in 2015 aimed for increases, but progress stalled.
Willie Walsh told the end of year media briefing by IATA in Geneva that airlines had committed to targets such as 10% sustainable aviation fuel usage by 2030. These goals proved difficult to achieve due to limited availability rather than cost issues. Airlines entered these commitments with expectations of greater supply, but shortages forced reevaluations.
He saidegulatory frameworks, particularly in Europe, contributed to this situation by imposing measures that raised costs for airlines. Suppliers implemented compliance fees that elevated fuel prices, affecting the sector’s ability to meet obligations.
He namechecked New Zealand for confronting reality and suspending its targets, highlightiing the broader challenges in the SAF supply chain.
Production continued at current levels without corresponding expansions in infrastructure or policy support. The introduction of mandates has led to suppliers charging additional fees, which airlines viewed as exploitation of their market position. This dynamic protected supplier profits while failing to deliver the required fuel volumes. Airlines struggled to acquire the necessary amounts to fulfill their pledges.
Non-financial measures are a focus as obligations increase into 2026. The failure of the supply side prompted more carriers to assess the feasibility of their earlier targets. Regulators observed these developments without intervening, allowing the price increases to persist. This lack of action compounded the difficulties for the industry.
Key takeaways include the need for improved regulatory frameworks to boost production, the importance of addressing supply shortages to meet commitments, and the call to hold suppliers accountable for fee structures. The sector requires coordinated efforts to prevent further reevaluations of sustainability goals.
Mr Walsh shared: “I’m disappointed that the piece of progress and there are some worrying developments that we witness during 2025.”
“This is a great disappointment a couple of airlines who have committed to high levels of SAF in 2013 made 10pc by 2030 I believe be challenging for the industry to achieve.”
