SAF Production Falls Short, Concern For 2026 -- IATA

From Kisho Kumari Sucedaram

GENEVA, Dec 9 (Bernama) -- Sustainable aviation fuel (SAF) production is falling far short of global expectations, forcing airlines to reconsider their 2030 green targets, said International Air Transport Association (IATA) director general Willie Walsh.

Speaking at the IATA Global Media Day in Geneva, Walsh said the industry’s progress in 2025 has been slower than anticipated, with some worrying developments likely to continue into 2026.

“We are not seeing SAF produced in the volumes we had hoped for and expected. That is disappointing, and looking forward to next year, we are clearly concerned about the progress being made in 2026,” he said.

Walsh reiterated that when airlines committed to net-zero emissions by 2050, they knew it would be extremely challenging and expensive. However, the gap between ambition and reality has widened more than expected.

“The demand for SAF continues to be strong, but we are not seeing a corresponding increase in its development,” he said, adding that the regulatory environment, particularly in Europe, has been unhelpful.

Walsh pointed out that the European Union’s SAF mandate has failed to spur production, instead driving prices sharply higher as fuel suppliers attempt to comply with regulatory obligations.

“We have not seen the mandate lead to greater production of SAF, but we have seen it drive a huge increase in its price,” he said.

He noted that many airlines that pledged high SAF utilisation by 2030, including commitments of up to 10 per cent, will likely be unable to reach those targets due to supply shortages.

“Personally, I believe those figures are now impossible to achieve. It will be challenging for the industry to meet the six per cent interim target that the International Civil Aviation Organisation (ICAO) envisaged,” Walsh said.

He stressed that the shortfall was not due to a lack of willingness or financial capacity among airlines.

“It is through no fault of their own. These airlines made commitments in good faith. They expected to acquire SAF in much greater volumes than is possible today. It is not an issue of price. It is an issue of availability,” he said.

Walsh expects more carriers to review or scale back their SAF targets in 2026, especially those required to report non-financial, climate-related metrics.

He said Air New Zealand had already taken the lead in reassessing its SAF ambitions amid supply constraints and aircraft delivery delays caused by global supply chain disruptions.

“As they re-evaluated their progress, they concluded it would be impossible to meet the commitments made. I suspect we will see many airlines do the same as we move into 2026,” he said.

Walsh also criticised fuel suppliers and regulators for failing to support market development, noting that price spikes labelled as “compliance fees” were squeezing airlines without delivering SAF availability.

He said the industry must “shine the spotlight” on those responsible.

“The people at fault are the regulators, for introducing a mandate that has driven this behaviour, and the fuel suppliers, who are, quite honestly, price gouging and ripping us off because they can get away with it,” he added.

-- BERNAMA