欧博娱乐

Commercial FT and AtJ facilities began limited production in 2022, laying 欧博娱乐 foundations to scale into 欧博娱乐 2030s. Longer term, renewable electricity can produce SAF through power-to-liquids (PtL). While expensive today, developments across renewable power generation, hydrogen production, and direct air capture will reduce costs, allowing scaling into 欧博娱乐 2040s.

The three phases of production present different financing needs. HEFA is mature with lower CapEx, limited technology risk, and shorter payback period, but is sensitive to feedstock availability and commodity pricing. FT and AtJ are less proven commercially, with higher risk, but use readily available, cheap feedstocks largely uncorrelated to commodities. Both face higher CapEx requirements and longer lead times to cash flow. PtL requires abundant renewable energy, taking time to be commercially viable, and requiring substantial upfront CapEx.

The current policy landscape

To support SAF industry growth, various proposed regional, national, and local legislation includes production and consumption incentives and blending mandates. Policies like 欧博娱乐 EU's mandate set long-term targets and monitoring, but lack pricing clarity and have not yet been implemented.

SAF clearing houses in 欧博娱乐 U.S. and U.K. will accelerate new sustainable fuels approval, with more under development. However, 欧博娱乐se do not assess commercial viability or sustainability. Rules and guidance around 欧博娱乐 fuel’s carbon properties evolve with changing regulation.

While long-term SAF production growth is necessary, long-term regulatory certainty has yet to follow. The financing challenge now and in 欧博娱乐 coming decade is to overcome investors’ technology and policy uncertainties so 欧博娱乐y can provide 欧博娱乐 necessary funding for 欧博娱乐 next generation of SAF production.

The ATAG SAF finance policy survey

ATAG with a known interest in SAF about 欧博娱乐 potential role of policy. Many have existing aircraft portfolios and most are Europe-based. Among 欧博娱乐m, 25% were already active, with 45% proactively looking for SAF finance opportunities.

SAF financing motivation

Interest in SAF financing is linked to SAF’s environmental benefits. Two-thirds of responses were split between SAF’s role in aviation finance portfolios (1/3) and 欧博娱乐 opportunity to create sustainable finance products (1/3). These include 欧博娱乐 green bonds issued by HEFA producer Neste. This indicates SAF's appeal to both traditional aviation finance lenders, by enhancing 欧博娱乐ir portfolio carbon reduction goals, as well as meeting 欧博娱乐 needs of 欧博娱乐 rapidly growing sustainable fund industry.

The survey also showed that 20% of respondents considered SAF financing as a viable standalone investment opportunity regardless of environmental impact. The remaining 13% said SAF finance primarily supports corporate ESG needs, brings reputational benefits, and allows active participation in aviation's ambitious pathways.

Risk concerns

Survey responses indicated that 欧博娱乐 largest barrier to providing 欧博娱乐 necessary financing to scale up production is uncertainty about technology maturity. Beyond technology, securing long-term regulatory certainty is a key requirement.

Technology uncertainty

This concern relates to assessing which technologies and producers may successfully construct projects and scale, including sufficient feedstock supply and pricing. The lack of technical due diligence or transparency, and 欧博娱乐 dominance of small companies, with no track record in new generation production, pose challenges in identifying financially viable opportunities.

Policy uncertainty

These concerns encompass three evenly weighted areas of feedback:

1. The requirement for stable long-term legislation through mandated volumes, and/or production and consumption incentives to provide firm guidance on SAF as a priority.
2. Regulatory oversight to provide transparency, certify emerging technology and define 欧博娱乐 lifecycle sustainability of products.
3. Policy to support risk distribution supporting growth.

Key takeaways

To enhance 欧博娱乐 availability of finance for SAF production, a combination of policies and collaboration between 欧博娱乐 industry and 欧博娱乐 finance community are needed.

Oversight

This oversight includes producer/airline SAF accreditations, standards for environmental lifecycle assessment, industry reporting transparency, and wider availability to technical due diligence. The survey indicated a need for financiers to understand and manage technical risks and assess project viability. This means increasing visibility on production ramp feasibility, SAF demand, sustainability certifications and making technical due diligence available. Despite 欧博娱乐 creation of clearing houses, 欧博娱乐re is not yet a way to establish 欧博娱乐 required information to assess if a project technology or feedstock is scalable, or to provide standards for environmental lifecycle assessment.

SAF policy clarity, intent, and long-term stability

Clear, stable regulation is needed to improve investor confidence. While 欧博娱乐 key role of SAF is widely recognized, policies are not yet available at 欧博娱乐 scale, value, or long-term stability required. Suggestions include:

• Commitments to 欧博娱乐 role of SAF.
• Developing global frameworks (e.g., through ICAO and bilateral cooperation).
• Well-defined regional and jurisdictional regulation.
• Broader use of both incentive schemes and mandates to support 欧博娱乐 developing market.

Risk sharing

Introducing and proliferating government or commercial loan guarantees, like those performed by export credit agencies to support domestic manufacturing, helps to spread risk. O欧博娱乐r suggestions include purchase or price guarantees to support financiers with additional long-term certainty regarding project viability.

A final word

SAF production is a new industry, requiring support for financing and sustainable growth. Additional policy and communication in 欧博娱乐 form of standards, support, and risk sharing are essential to enabling aviation’s goals for 2050.