PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 1890754
PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 1890754
The global sustainable aviation fuel (SAF) market is rapidly transforming the aviation industry's decarbonization efforts. In 2024, the market reached USD 1,845.19 million, driven by rising pressure to reduce carbon emissions, increased corporate sustainability commitments, and expanding government mandates. The market is expected to grow significantly to USD 2,723.78 million in 2025, supported by large-scale SAF procurement agreements and substantial investments in production technologies. By 2032, the SAF market is projected to reach an impressive USD 28,636.36 million, exhibiting a robust CAGR of 39.95% from 2025 to 2032.
North America dominated the market in 2024 with a 46% share, fueled by strong policy support, tax incentives, and initiatives such as the U.S. SAF Grand Challenge, targeting 3 billion gallons of annual production by 2030. SAF's importance continues to rise as aviation accounts for 2% of global CO2 emissions and 12% of transportation-sector emissions. More than 360,000 commercial flights across 46 airports used SAF in 2024, according to ICAO, reflecting rapid global adoption.
Market Dynamics
Drivers: Accelerating Demand for Low-Carbon Alternatives
Growing awareness of climate change, combined with aviation's increasing emissions footprint, is driving airlines to transition to sustainable fuels. SAF can reduce lifecycle CO2 emissions by up to 80%, depending on feedstock and production method. As IATA estimates that 65% of aviation emission reductions needed for net-zero by 2050 will come from SAF, the urgency for large-scale production has never been greater.
Government intervention is also boosting adoption. Mandates such as the EU's ReFuelEU, requiring 2% SAF use by 2025, and the U.K.'s SAF mandate beginning in 2025, are pushing airlines toward higher blending ratios. In the U.S., 2024 policy changes allowed ethanol-based feedstocks to qualify for SAF subsidies, increasing investor confidence.
Opportunities: Technological Innovation and Scaling Production
New technologies are emerging rapidly. HEFA-SPK remains the dominant SAF production pathway due to feedstock flexibility, but alternatives like Alcohol-to-Jet and Fischer-Tropsch (FT) are expanding. In 2024, Honeywell introduced a new biomass-to-SAF hydrocracking technology capable of reducing emissions by 90% versus fossil-based jet fuel. The world's first commercial ethanol-to-jet SAF plant, LanzaJet's Freedom Pines Fuels, also opened in 2024, marking a major milestone.
Global corporate initiatives are accelerating market growth. Major airlines across the U.S., Europe, and Asia are adopting SAF to meet sustainability targets. Recent agreements include Air Canada's procurement of 60,000 tons, Singapore Airlines' purchase of 1,000 tons, and Boeing's acquisition of 7.5 million gallons of blended SAF in 2024.
Restraints: High Cost and Feedstock Constraints
Despite strong momentum, SAF adoption is hindered by high production costs-currently 2 to 7 times higher than conventional jet fuel. In 2023, SAF averaged USD 2,500 per ton, approximately 2.8X the cost of traditional jet fuel. Feedstock scarcity-especially for used cooking oil, tallow, and waste fats-further limits production capacity. SkyNRG reports that achieving global SAF demand in 2050 would require 500-800 new SAF facilities and approximately USD 1 trillion in investment, reflecting the enormous scale required.
Segmentation Highlights
Biofuel dominated SAF types in 2024 with an 87% market share, due to compatibility with existing aircraft and infrastructure.
HEFA-SPK led the technology segment, while ATJ-SPK is projected to grow fastest due to flexible alcohol feedstock options.
In blending capacity, the 30-50% segment dominated in 2024 as airlines increased SAF blending to achieve net-zero targets.
The commercial aviation segment held the largest share due to rising airline sustainability commitments.
By application, fixed-wing aircraft dominated in 2024, supported by OEM testing and government incentives.
North America remained the largest regional market, valued at USD 1,264.61 million in 2024. Strong policy frameworks and leading SAF suppliers, such as Neste and World Energy, continue to support expansion.
Europe ranked second, anchored by its aggressive emission-reduction mandates. The region is forecast to reach USD 886.60 million in 2025, driven by large SAF procurement contracts and strict regulatory obligations.
Asia Pacific is expanding due to rapid air-traffic growth and new SAF initiatives in China, Japan, Australia, and India.
Latin America and Africa are emerging markets, supported by abundant biomass and favorable government policies such as Brazil's Fuel of the Future Law (2024).
Conclusion
With market value rising from USD 1,845.19 million in 2024 to USD 28,636.36 million by 2032, Sustainable Aviation Fuel is positioned as the most critical pillar of aviation's decarbonization pathway. Despite cost barriers and feedstock challenges, expanding technologies, supportive regulations, and large-scale airline commitments will drive unprecedented growth through 2032.
Segmentation By Type, Technology, Blending Capacity, End Use, and Application
By Type
By Technology
By Blending Capacity
By End Use
By Application
By Region * North America (By Type, Technology, Blending Capacity, End Use, Application, and Country)