North America Sustainable Aviation Fuel Market – Industry Trends and Forecast to 2029

North America Sustainable Aviation Fuel Market Analysis and Size

The aviation industry is keen on bringing down carbon footprints to achieve a sustainable environment and meet the stringent regulatory standards on emissions. Alternative solutions, such as improving aero-engine efficiency by design modifications, hybrid-electric and all-electric aircraft, renewable jet fuels, etc., are being adopted by various stakeholders of the aviation industry. However, out of these solutions, the adoption of sustainable aviation fuels such as E-fuels, synthetic fuels, green jet fuels, bio jet fuels, hydrogen fuels is one of the most feasible alternative solutions with respect to socio and economic benefits when compared to others, which contributes significantly to mitigating current and expected future environmental impacts of aviation.

Sustainable aviation fuels are a key component in meeting the aviation industry’s commitments to decouple increases in carbon emissions from traffic growth. Factors such as a rise in a number of airline passengers, growing disposable income, increase in air transportation, and increase in consumption of synthetic lubricants supplement the growth of the North America sustainable aviation fuel market. However, the lack of infrastructure act as a restraining factor for the market.

Data Bridge Market Research analyses that the Sustainable aviation fuel market is expected to reach the value of EURO 5,526.53 million by 2029, at a CAGR of 52.1% during the forecast period. “Bio Fuel" accounts for the largest technology segment in the Sustainable aviation fuel market due to rapid developments in technological pathways to commercialize the use of alternative jet fuel. The Sustainable aviation fuel market report also covers pricing analysis, patent analysis, and technological advancements in depth

Market Definition

Sustainable aviation fuel is a unique form of fuel designed for use in aircraft and at the same time will increase the performance of aircraft. Sustainable aviation fuels are derived from sustainable feedstock and could be very comparable in their chemistry to standard fossil jet fuel. An increase in the utility of sustainable aviation fuels bring about a reduction in carbon emissions in comparison to the traditional jet fuel because it replaces the lifecycle of the fuel.

The aviation enterprise is willing towards bringing down carbon footprints to obtain a sustainable environment and meet stringent regulatory requirements on emissions. Moreover, enhancing aero-engine performance through layout modifications, hybrid-electric and all-electric powered aircraft, renewable jet fuels, are being adopted by numerous stakeholders of the aviation industry however the adoption of sustainable aviation fuel is taken into consideration the maximum dependable and viable opportunity solutions with respect to socio and economic advantages while in comparison to others, which contributes extensively to mitigating modern and anticipated future environmental impacts of aviation.

Sustainable Aviation Fuel Market Dynamics

This section deals with understanding the market drivers, advantages, opportunities, restraints and challenges. All of this is discussed in detail as below:

• Increasing Need for Reduction in GHG Emissions in the Aviation Industry

Human-caused greenhouse gas (GHG) emissions amplify the greenhouse effect, causing climate change. Carbon dioxide is emitted primarily through the combustion of fossil fuels such as coal, oil, and natural gas. Some of the biggest polluters are China and Russia. These pollutions is mostly caused due to the OPEC (Organization of the Petroleum Exporting Countries) owned coal, oil and gas corporations. Carbon dioxide levels in the atmosphere have grown by around 50% from pre-industrial times due to human-caused emissions.

Pollutants emitted by aircraft engines are equivalent to those emitted by fossil fuel combustion. At higher altitudes, aircraft emissions have a greater concentration of contaminants. These emissions create serious environmental issues, both in terms of their North America effect and their impact on local air quality

• Increase in Air Transportation, and Increase in Consumption of Synthetic Lubricants

Air travel is a critical component in achieving economic growth and development. On a national, regional, and worldwide scale, air travel fosters integration into the North America economy and offers crucial linkages. It contributes to the growth of trade, tourism, and job possibilities. The aviation system is evolving and will continue to evolve. However, in the long run, it will be difficult for the air transportation system to adapt quickly enough to fulfil changing needs in terms of capacity, environmental impact, consumer happiness, safety, and security, all while maintaining service providers' economic viability.

The pandemic of Covid-19, along with government backing and technological discoveries, particularly in the field of fuel technology, has accelerated the aviation industry's transition to sustainable aviation fuel SAF). While the use of sustainable aviation fuel (SAF) is on the rise, non-synthetic lubricants are on the decline. Synthetic and semi-synthesis lubricants are expected to benefit from the transition because most aircrafts employ advanced grade lubricants. The worldwide sustainable aviation fuel (SAF) market is predicted to be driven by this factor.

• Increase in Demand for Sustainable Aviation Fuel by Airlines

The aviation sector is adopting "urgent action" to meet the world's climate objective, which includes reducing air travel growth and swiftly scaling up the use of sustainable aviation fuels (SAF). SAF's purpose is to recycle carbon from existing sustainable biomass or gases into jet fuel as a replacement for fossil jet fuel refined from petroleum crude oil. SAF's purpose is to recycle carbon from existing sustainable biomass or gases into jet fuel as a replacement for fossil jet fuel refined from petroleum crude oil. The aviation sector as a whole, as well as IATA member airlines, are committed to attaining aggressive emissions reduction objectives. SAFs (sustainable aviation fuels) have been highlighted as a key component in reaching these goals. It will take government support to use sustainable aviation fuels to satisfy the industry's climate goals

As the key industry players are recognizing the need for sustainable aviation fuels (SAF), therefore the service providers have started embracing various sustainable aviation fuels (SAF) alternatives in various airlines, which is expected to further drive the growth of the sustainable aviation fuels (SAF) significantly.

• Inadequate Availability of Feedstock and Refineries to meet Sustainable Aviation Fuel Production Demand

Sustainable aviation fuels (SAFs), which are made from bio-based feedstock’s, are an important part of the plan to decrease aviation's carbon footprint. Technically, substituting and mixing SAFs with jet fuel is possible; in fact, the aviation industry has been using SAFs for over a decade. However, because of supply and demand constraints, consumption levels remain exceedingly low.

Oil crops, sugar crops, algae, waste oil, and other biological and non-biological resources are the raw materials that play an essential part in the whole production chain of alternative aviation fuels such as synthetic fuels, e-fuels, and bio jet fuels. The need for sustainable aviation fuel may come to a standstill due to a paucity of raw materials required for manufacture. Because of a scarcity of raw materials necessary for its manufacture, demand for sustainable aviation fuel may come to a halt. Furthermore, refinery restrictions, which play a critical role in the optimal exploitation of these feedstock, add to the total process of SAF manufacturing. Low fuel supply also puts a strain on the fuel's mixing capacity, resulting in lower efficiency.

When competition from the road gasoline sector for feedstock that meets sustainability standards grows, feedstock availability becomes a bottleneck. Feedstock costs are a significant part of the SAF cost, and price fluctuation can cause supply issues for fuel producers. Therefore, a higher fuel surcharge by a carrier is further hindering the growth of the market to an extent.

• Fluctuations in Crude Oil Prices and Contamination of Lubricants

Increasing North America competition and cost pressure force enterprises and supply chains to discover undetected cost-saving potentials. In particular, interfaces to the crude oil market are a promising field for improvement. In today’s business environment, every organization faces some risk of fluctuation in the price of crude oil and lubricant commodities. In production, manufacturers may rely on a significant amount of oil commodities, and as a result can be especially impacted by price volatility in the oil products they procure directly and indirectly through components and subassemblies. Volatile and unstable North America markets have widespread implications for manufacturing organizations. From rising energy costs to unexpected fluctuations in crude oil manufacturing costs, unforeseen obstacles are destabilizing supply chains and making it difficult for manufacturers to remain in the black. With supplies of many raw materials becoming harder to secure, commodity price volatility may not be just a temporary phenomenon, and it is up to manufacturers to either absorb additional costs, find new ways to mitigate the expenses, or pass price increases along to customers who are already reluctant to spend. Since pricing is affected by the tightening of supply markets, this trend shows no indication of changing anytime soon. Thus, the fluctuating cost of crude oil and other lubricants acts as a major restrain for the North America sustainable aviation fuel (SAF) market.

Carbon fragments are typically not hard enough or big enough to cause pump failure. They could, however, be big enough to block tiny filters or nozzles. Another cause of operational contamination is the presence of sand, grit, and metallic particles in the lubrication system. Which acts as a restraining factor for the North America sustainable aviation fuel (SAF) market.

• Reduction in Carbon Foot Print Due to Low Capability of Sustainable Aviation Fuel

Sustainable aviation fuel (SAF) reduces carbon emissions over the lifespan of the fuel as compared to the traditional jet fuel it replaces. Cooking oil and other non-palm waste oils from animals or plants are common feedstock, as are solid waste from homes and companies, such as packaging, paper, textiles, and food scraps that would otherwise be disposed of in landfills or incinerated. Forest debris, such as waste wood, and energy crops, such as fast-growing plants and algae, are also possible sources.

Depending on the sustainable feedstock utilized, production process, and supply chain to the airport, SAF can reduce carbon emissions by up to 80% during the lifespan of the fuel compared to the traditional jet fuel it replaces.

SAF may be mixed up to 50% with standard jet fuel and undergoes the same quality testing as traditional jet fuel. After then, the mix is recertified as Jet A or Jet A-1. It can be handled in the same manner as standard jet fuel is, thus no changes to the fuelling infrastructure or aircraft that desire to utilize SAF are necessary which creates an opportunity for the growth of the North America sustainable aviation fuel market.

• Development of Eco-Friendly and Safe Aviation Lubricants

In today's world, the aviation industry is booming, resulting in increased rivalry among aircraft aviation fuel producers in all areas. Alternative environmentally friendly sources for long-term aviation fuel production are expected to have a future influence on the aviation fuel sector. The market for sustainable aviation fuel has grown significantly over the years, owing to the growing trend of advanced fuels being utilized in airplanes all over the world.

Growing biomass crops for sustainable aviation fuel production also allows farmers to make more money in the off-season by contributing feedstock to this new industry, while simultaneously securing agricultural advantages such as nutrient loss reduction and improved soil quality. Thereby, creating an opportunity for the growth of North America sustainable aviation fuel (SAF) market.

• High cost of Sustainable Aviation Fuel Increases the Operating Cost of Airlines

Labour and fuel expenditures are the two most significant expenses that airlines face. In the near term, labour expenses are usually stable, but fuel prices fluctuate significantly depending on the price of oil. Fuel is a significant part of the cost of running an airline, accounting for 20-30% of total expenditures. Oil price spikes have been some of the toughest moments for airlines. Airlines can prepare for gradually rising prices by raising ticket prices or lowering the number of flights, but unexpected increases in pricing cause many airlines to lose money.

Targets for the use of sustainable aviation fuel (SAF) will begin adding to the cost of fuel this year, making things even more difficult for airlines. According to the International Air Transport Association (IATA), North America SAF production is only approximately 100 million litres per year, or 0.1 percent of all aviation fuel utilised. Various airlines, on the other hand, have pledged to increase this percentage to 10% by 2030, a genuinely lofty objective.

Unfortunately, because of the limited volume of manufacturing, the cost is likewise expensive. The cost of SAF is estimated to be between two and four times that of fossil fuels by IATA, while a recent disclosure by Air France-KLM suggested that the cost disparity might be closer to four to eight times that of kerosene.

Governments have been urged by the International Air Transport Association (IATA) and others to encourage the development of SAF, but in the form of economic stimulation. This paves way for the increase in prices of sustainable aviation fuel (SAF) thereby acting as a challenge for North America sustainable aviation fuel (market.

Post COVID-19 Impact on Sustainable Aviation Fuel Market

COVID-19 created a major impact on the sustainable aviation fuel market as almost every country has opted for the shutdown for every production facility except the ones dealing in producing the essential goods. The government has taken some strict actions such as the shutdown of production and sale of non-essential goods, blocked international trade, and many more to prevent the spread of COVID-19. The only business which is dealing in this pandemic situation is the essential services that are allowed to open and run the processes.

The growth of the sustainable aviation fuel market is increasing due to need for reduction in GHG emissions in the aviation industry. However, factors such as inadequate availability of feedstock and refineries to meet sustainable aviation fuel production demand in Sustainable aviation fuel are restraining the market growth. The shutdown of production facilities during the pandemic situation has had a significant impact on the market.

Manufacturers are making various strategic decisions to bounce back post-COVID-19. The players are conducting multiple research and development activities to improve the technology involved in the Sustainable aviation fuel. With this, the companies will bring advanced and accurate controllers to the market. In addition, the use of sustainable aviation fuel by government authorities in air freight has led to the market's growth.

Recent Development

• In March 2022, Gevo and oneworld Alliance, a network of world-class airlines, announced that certain oneworld Oneworld members plan to purchase up to 200 million gallons per year of sustainable aviation fuel (“SAF”) from Gevo (the “ oneworld Alliance SAF Purchase Goal”). The delivery of the SAF is expected to commence in 2027, for a five-year term. This agreement helps in improving the revenue of the company.
• In December 2021, Fulcrum BioEnergy announced that it has completed interim financing for its second waste-to-fuels project, culminating in the issuance of USD 375 million in Environmental Improvement Revenue Bonds (Bonds) by the Indiana Finance Authority through Fulcrum's wholly owned subsidiary Fulcrum Centerpoint, LLC (Centerpoint). This business development helps in improving the North America presence of the company.

North America Sustainable Aviation Fuel Market Scope

The Sustainable aviation fuel market is segmented on the basis of fuel type, manufacturing technology, blending capacity, and blending platform. The growth amongst these segments will help you analyse meagre growth segments in the industries and provide the users with a valuable market overview and market insights to help them make strategic decisions for identifying core market applications.

Fuel Type

• Bio Fuel
• Hydrogen Fuel
• Power To Liquid Fuel

On the basis of fuel type, the North America sustainable aviation fuel market is segmented into bio fuel, hydrogen fuel and power to liquid fuel

Manufacturing Technology

• Hydroprocessed Fatty Acid Esters and Fatty Acids - Synthetic Paraffinic Kerosene (HEFA-SPK)
• Fischer Tropsch Synthetic Paraffinic Kerosene (FT-SPK)
• Synthetic Iso-Paraffin from Fermented Hydroprocessed Sugar (HFS-SIP)
• Fischer Tropsch (FT) Synthetic Paraffinic Kerosene with Aromatics (FT-SPK/A)
• Alcohol to Jet Spk (ATJ-SPK)
• Catalytic Hydrothermolysis Jet (CHJ)

On the basis of manufacturing technology, the North America sustainable aviation fuel market has been segmented into hydroprocessed fatty acid esters and fatty acids - synthetic paraffinic kerosene (HEFA-SPK), fischer tropsch synthetic paraffinic kerosene (FT-SPK), synthetic Iso-paraffin from fermented hydroprocessed sugar (HFS-SIP), fischer tropsch (FT) synthetic paraffinic kerosene with aromatics (FT-SPK/A), alcohol to jet SPK (ATJ-SPK) and catalytic hydrothermolysis jet (CHJ).

Blending Capacity

• Below 30 %
• 30 % To 50 %
• Above 50%

On the basis of blending capacity, the North America sustainable aviation fuel market has been segmented into below 30 %, 30 % to 50 % and above 50%.

Blending Platform

• Commercial Aviation
• Military Aviation
• Business & General Aviation
• Unmanned Aerial Vehicle

On the basis of blending platform, the North America sustainable aviation fuel market has been segmented into commercial aviation, military aviation, business & general aviation, and unmanned aerial vehicle

Sustainable Aviation Fuel Market Regional Analysis/Insights

The Sustainable aviation fuel market is analysed and market size insights and trends are provided by country, fuel type, manufacturing technology, blending capacity, and blending platform as referenced above.

The countries covered in the Sustainable aviation fuel market report are U.S., Canada and Mexico in North America

U.S. dominates the North America Sustainable aviation fuel market, this is attributable to reduction in carbon footprints because of growing air traffic and air passengers, the international locations such as the US and Canada in North America are focused on various initiatives to make use of the renewable aviation fuel. In addition, with supportive regulations and initiatives by government are driving the sustainable aviation fuel market in Canada.

The country section of the report also provides individual market impacting factors and changes in market regulation that impact the current and future trends of the market. Data points like down-stream and upstream value chain analysis, technical trends and porter's five forces analysis, case studies are some of the pointers used to forecast the market scenario for individual countries. Also, the presence and availability of North America brands and their challenges faced due to large or scarce competition from local and domestic brands, impact of domestic tariffs and trade routes are considered while providing forecast analysis of the country data.

Competitive Landscape and Sustainable Aviation Fuel Market Share Analysis

The sustainable aviation fuel market competitive landscape provides details by competitor. Details included are company overview, company financials, revenue generated, market potential, investment in research and development, new market initiatives, North America presence, production sites and facilities, production capacities, company strengths and weaknesses, product launch, product width and breadth, application dominance. The above data points provided are only related to the companies' focus related to sustainable aviation fuel market.

Some of the major players operating in the sustainable aviation fuel market are Gevo, Fulcrum BioEnergy, Prometheus Fuels, World Energy, Avfuel Corporation, LanzaTech, Honeywell International Inc, Chevron Corporation, Exxon Mobil Corporation, Johnson Matthey, VIRENT, INC., HyPoint Inc., among others.

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