UK government to introduce revenue-certainty scheme to support SAF production
The U.K. Department for Transport announced Sept. 4 that it has committed to introducing a revenue-certainty mechanism to support sustainable aviation fuel (SAF) production in the U.K. and boost its uptake, giving producers greater assurance about earnings from the SAF they produce.
SAF is the most developed pathway for aviation decarbonization and while the U.K.’s SAF program is already one of the most comprehensive in the world, the government recognizes the importance of providing long-term certainty for the industry.
This scheme, along with the introduction of a mandate for SAF in 2025, will provide fuel security, grow the economy and help to create over 10,000 jobs by 2030, rising to 60,000 by 2050.
To do this, DfT will launch a consultation on the design and delivery of the scheme to bolster the development of SAF and drive further investment.
The revenue-certainty scheme, which is intended to be funded by industry, will give the aviation sector the launchpad to confidently invest in SAF and transition away from fossil-fuel reliance.
“Not only will sustainable aviation fuel bring countless economic opportunities, including creating thousands of green jobs, this certainty will allow the industry to harness its full potential, bringing us closer to net-zero flying,” said Charlotte Vere, the U.K.’s aviation and maritime minister. “This commitment is an important step to create cleaner and greener aviation in the U.K. and will cement our position as a global leader in innovation, creating a new talented workforce that champions decarbonization and pave the way for future air travel.”
Developing new low- or zero-emission technology is key to going green and it is important the world of aviation stays ahead of the game.
That’s why the government has already shown its commitment through its £165 million (USD$207 million) Advanced Fuel Fund, which is already providing investors with reassurance in U.K. SAF, as well as supporting crucial scientific research and coinvesting in innovative aerospace technology through over £600 million (USD$752.9 million) funding committed to the Aerospace Technology Institute to support the industry transition to net zero. Considering options for additional revenue certainty will further support the development and production of SAF and bring the U.K. a step closer to achieving Jet Zero.
A delivery plan for how this mechanism can be delivered by the end of 2026 has also been published, building on the work by the Jet Zero Council to consider the best way to support the aviation industry to decarbonize.
“SAF project developers welcome this commitment and look forward to working with DfT to ensure the government’s ambition of getting commercial projection plants into construction becomes a reality,” said Gaynor Hartnell, chief executive of the Renewable Transport Fuel Association.
Jonathon Counsell, chair of the Jet Zero Council SAF Delivery Group, added, “SAF will play the most important role in meeting our net-zero targets and especially in reducing aviation emissions this decade. So we welcome the commitment to a revenue-certainty scheme. Industry is ready to take part in the consultation process to determine the right mechanism to secure the investment needed to create a U.K. SAF industry. The Jet Zero SAF Delivery Group will work with government to move forward quickly with the consultation. We will work with the government to be able to implement measures at the earliest opportunity so that we can hit the target of five U.K. SAF plants in construction by 2025.”
Grant Pearson, chair of the JZC subgroup on SAF commercialization, said, “This will help maintain the momentum needed to capitalize on DfT’s support for SAF to date. It will help reassure project developers that the U.K. is serious in its bold ambition to spearhead an innovative and highly sustainable domestic aviation fuel industry. The Jet Zero Council process has brought together the stakeholders that will start the transition of aviation into a more sustainable future. They have been consistent in calling for government to complement its SAF mandate with a means to facilitate SAF-project financing.”