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"The global aviation sector faces an increasingly complex regulatory landscape as jurisdictions implement distinct frameworks to promote the adoption of Sustainable Aviation Fuel."
The global aviation sector faces an increasingly complex regulatory landscape as jurisdictions implement distinct frameworks to promote the adoption of Sustainable Aviation Fuel (“SAF”). With the UK and EU operating separate SAF mandates and trading regimes, fuel suppliers, airlines, airport operators and investors are tasked with navigating two different sets of rules; namely, the Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024 (“UK SAF Mandate”) and the ReFuelEU Aviation Regulation (“ReFuelEU”).
Whilst both regimes aim to reduce emissions associated with aviation, they differ in a number of important aspects. This article provides an overview of the key features and differences between the two mandates.
1. To whom do the UK and EU regimes apply?
The table below sets out the key differences in respect of the affected parties under the regimes.
| Criteria | UK SAF Mandate | ReFuelEU |
|---|---|---|
| Primary obligated parties | Aviation fuel suppliers supplying relevant aviation fuel. | Fuel suppliers, airline operators and airport operators. |
| Threshold for applicability | Suppliers owning/supplying ≥15.9 TJ of jet fuel annually. | No fixed volume threshold; applies broadly to relevant operators. |
| Geographic scope | Fuel supplied for use in the UK. | Flights departing from EU/EEA airports (including non-EU carriers). |
| Airline operators | Not directly subject to obligations. | Subject to obligations if operating flights departing from EU/EEA airports. |
| Airport operators | Not directly subject to obligations. | Subject to obligations if handling >800,000 passengers or >100,000 tonnes of freight annually. |
2. What is SAF under the different regimes?
Unlike alternative technologies (the likes of hydrogen and battery-powered aircrafts) which are not readily viable commercial solutions, SAF is a ‘drop-in’ fuel that can be easily blended with conventional jet kerosene for use in existing aircraft engines, with no need for engine modification. SAF therefore plays a key role in the strategy of the UK and EU to reduce aviation emissions.
The UK SAF Mandate categorises SAF into three types based on their production pathways, whereas ReFuelEU sets out a number of acceptable SAF sources, which differ in some respects from the UK SAF Mandate.
| SAF under the UK SAF Mandate | SAF under ReFuelEU |
|---|---|
| (a) HEFA: HEFA stands for ‘hydroprocessed esters and fatty acids’. These are biofuels developed from oils or fats such as used cooking oil, vegetable oil or animal fats. (b) Non-HEFA: fuels derived from other types of waste, including biomass and municipal solid waste. (c) Power-to-Liquid Fuels (“PtL”)/eSAF or synthetic SAF: fuels produced from low carbon power sources such as renewable energy. PtL presents a key long-term solution for aviation decarbonisation given their lower lifecycle carbon footprint and the fact they do not depend on feedstock availability. | (a) Biofuels: similar to the UK SAF Mandate for HEFA, these fuels are produced from feedstocks like cooking oil and animal fats. These fuels accrue fewer incentives than advanced biofuels and synthetic fuels due to concerns over land use and feedstock competition.¹ (b) Advanced Biofuels: produced from agricultural and forestry residues, algae, industrial and biowaste.² (c) Recycled Carbon Aviation Fuels: produced from non-renewable waste streams such as industrial off-gases and municipal solid waste. These fuels must achieve at least 70% lifecycle Greenhouse Gases (“GHG”) savings to be eligible. (d) Low-Carbon Synthetic Fuels: these are fuels made from non-fossil sources that meet the same GHG savings threshold and include low-carbon hydrogen and synthetic fuels that are not fully renewable. (e) Synthetic Aviation Fuels (e-fuels/eSAF): produced from renewable hydrogen and captured carbon dioxide and subject to the sub-mandate target. These fuels, particularly e-kerosene (the aviation category of e-fuels), will play an increasingly prominent role, with a specific mandate ensuring its integration into the fuel mix. |
3. Overview of UK and EU regimes
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"Unlike the US approach which encourages the adoption of SAF through various incentives rather than with a direct SAF blending mandate at the federal level, the UK and EU mandates aim to decarbonise aviation by introducing SAF blending obligations that increase over time."
Unlike the US approach which encourages the adoption of SAF through various incentives rather than with a direct SAF blending mandate at the federal level, the UK and EU mandates aim to decarbonise aviation by introducing SAF blending obligations that increase over time.³ Both SAF regimes came into force on 1 January 2025 and set legally binding obligations which increase over time – starting at 2% SAF in 2025.
(a) UK SAF Mandate
The UK SAF Mandate works alongside a broader set of legislative measures designed to accelerate the uptake of SAF. It imposes two obligations on relevant aviation fuel suppliers:
- main obligation: under the main obligation, SAF must account for 2% of the total fossil jet fuel supplied in the UK in 2025, increasing to 10% in 2030, and reaching 22% by 2040. This 22% target will remain stable and be revised once there is greater certainty on future SAF supply; and
- power-to-liquid obligation: this obligation will only come into force from 2028, starting at 0.2% of total jet fuel demand and will increase to 0.5% by 2030 and 3.5% in 2040. The PtL approach is similar to the ReFuelEU approach, which has a separate minimum percentage for e-kerosene to encourage demand for this SAF category. PtL certificates may be used to meet the requirements of either the SAF obligation or the PtL obligation.
To demonstrate compliance with the obligations, relevant suppliers must register with the Administrator (the Department for Transport) within 28 days of supplying fuel for use in aircrafts, and either apply for SAF Certificates or pay the buy-out price:
(1) Application for SAF Certificates
Suppliers must apply for these no later than 14 May after the end of an obligation period (which runs from 1 January – 31 December). To do so, they must submit satisfactory evidence to the administrator that the fuel is both eligible and sustainable. All aviation fuels must be approved by a third-party verifier (chosen by the supplier from the administrator’s approved list) tasked with confirming the fuel contains correct proportions of non-SAF and SAF.
At the outset there is no limit to the percentage of HEFA-derived fuels that can be present in SAF, but a cap of 92% will be imposed in 2027, which will decrease to 74.7% by 2030, and fall to 42% by 2040. Unlike ReFuelEU, the UK SAF Mandate does not distinguish between biofuel SAF and eSAF and no further differentiation is envisaged in the SAF Bill that was introduced to the UK Parliament in May 2025. The SAF Bill had its first reading in the UK House of Lords on 20 October 2025, with the date of its second reading to be announced shortly.
Its purpose is to support the production of SAF by establishing a revenue certainty mechanism. Given the higher number of UK biofuel projects currently in development and the high capital and operating costs of eSAF, there is a concern that without ring-fenced funding, support for biofuel projects may come at the cost of advancing eSAF initiatives.
SAF Certificates are characterised as either “Relevant HEFA SAF Certificate”, “Main SAF Certificate” or “PtL SAF Certificate”:
| Type of feedstock and/or fuel | SAF certificate category | Subject to HEFA cap? | Can be used for PtL fuel obligation? |
|---|---|---|---|
| HEFA feedstock | Relevant HEFA SAF Certificates | Yes | No |
| All other SAF (e.g., biofuels from wastes) | Main SAF Certificates | No | No |
| PtL | PtL SAF Certificates | No | Yes |
"Given the higher number of UK biofuel projects currently in development and the high capital and operating costs of eSAF, there is a concern that without ring-fenced funding, support for biofuel projects may come at the cost of advancing eSAF initiatives."
Suppliers can carry their SAF Certificates forwards to meet up to 25% of their obligation in the following year and they can also transfer them to another party’s account, with the commercial matters of the transfer to be decided between the relevant parties. Whether carried forward or transferred, SAF Certificates will maintain their labels and will only count towards meeting that respective cap or obligation. Suppliers must redeem their SAF Certificates by 15 September following the relevant obligation period.
(2) Paying the buy-out price
Each SAF Certificate discharges 34 megajoules of the obligation. Where a supplier fails to redeem enough SAF Certificates to meet its obligation for any calendar year, it must pay a buy-out price of £0.137 per megajoule required to meet the main obligation and £0.145 per megajoule required to meet the PtL obligation. This differs from ReFuelEU, which does not allow buy-outs and instead imposes penalties on suppliers who are tasked with having to make up for their non-compliance the following year.
(b) ReFuelEU
In 2021, the EU released its ‘Fit for 55’ framework which aims to reduce its net GHG emissions by 55% by 2030. ReFuelEU is part of this regulatory framework and specifically promotes the increased use of SAF as the single most powerful tool to decrease aviation carbon dioxide emissions.
Compared to the UK SAF Mandate, ReFuelEU is broader in scope, applying not only to aviation fuel suppliers, but also to aircraft operators operating more than 500 commercial passenger flights departing from an EU airport per year, and to Union airports where passenger traffic is greater than 800,000 passengers, or where freight traffic is higher than 100,000 tonnes in the previous reporting period. However, Union airports falling below these thresholds have the possibility of opting into the scope of ReFuelEU and thus being treated as Union airports for the purpose of the regulation. ReFuelEU only applies to EU Member States.
(i) Obligations on aviation fuel suppliers
ReFuelEU sets more ambitious long-term targets than the UK SAF Mandate, imposing an obligation on suppliers to supply fuel that contain a minimum of 2% SAF in 2025, escalating incrementally to reach 70% by 2050. It also mirrors the UK SAF Mandate’s PtL obligation by including a synthetic fuels sub-mandate of 1.2% in 2030, increasing to 35% by 2050, ensuring a portion of the SAF used comes from high-potential, low-emission synthetic sources, considered crucial for long-term aviation decarbonisation. Suppliers must also comply with certain reporting requirements by 14 February of each reporting year.
| Key Milestone Targets⁴ | ReFuelEU | UK SAF Mandate |
|---|---|---|
| SAF Targets | 2% in 2025 6% in 2030 70% in 2050 | 2% in 2025 10% in 2030 22% in 2040 |
| PtL/eSAF Targets | 1.2% in 2030 10% in 2040 35% in 2050 | 0.2% in 2028 0.5% in 2030 3.5% in 2040 |
Suppliers who fail to meet their SAF obligations face financial penalties which will be determined by individual EU Member States; however these penalties should be “effective, proportionate, and dissuasive”. ReFuelEU imposes a minimum penalty of at least twice the price difference between SAF and conventional jet fuel, and fuel suppliers will then also be required to supply any unmet fuel obligations in subsequent reporting periods.
| Criteria | ReFuelEU | UK SAF Mandate |
|---|---|---|
| Penalty Structure | EU imposes a penalty to pay at least twice the price difference between kerosene and SAF for failure to meet SAF quotas. | The UK uses a buy-out mechanism per litre of shortfall of SAF. |
| Estimated Penalties | SAF: ~€2,700 per tonne eSAF: ~€13,992 per tonne (sub-mandate does not begin until 2030) | SAF: £4.70/litre (~£5,880/tonne) PtL: £5/litre (~£6,250/tonne) |
(ii) Obligations on aircraft operators
Airlines must refuel at least 90% of their fuel requirements at their departure airport in the EU to prevent circumvention of SAF obligations via tankering (carrying excess fuel from airports outside the EU without such SAF regulations)[1]. There is currently no such equivalent anti-tankering provision under the UK regime. Operators can apply to the competent authority of the relevant EU Member State for temporary exemptions from the obligation to refuel ahead of departure for specific routes. Aircraft operators must also comply with certain reporting requirements by 31 March of each reporting year.
(iii) Obligations on Union airports and their managing bodies
Union airports and their managing bodies must ensure aircraft operators facilitate access to the necessary infrastructure and access to fuel suppliers to meet their SAF obligations under ReFuelEU. Under ReFuelEU, SAF is categorised based on production methods and feedstock sources. These categories are designed to uphold high sustainability standards and promote innovation in low-carbon aviation fuels. Unlike the UK SAF Mandate (under which eligible SAF may be made from discarded crop waste), the EU strictly bans crop-based fuels, except for a limited group of advanced biofuels with a focus on advanced and synthetic eSAF. This ban was reinforced by the EU General Court in 2025.
4. SAF in 2025
"Whilst there has been widespread support for the push for SAF in principle, in practice it seems unlikely that the production targets will be met."
Whilst there has been widespread support for the push for SAF in principle, in practice it seems unlikely that the production targets will be met. Meeting a 5% SAF share of global jet fuel demand by 2030 would entail a 15-fold increase in production levels from 2024.⁶ Key hurdles to this include the reluctance of offtakers to sign up to long-term offtake contracts for HEFA derived SAF at 2-7 times the cost of conventional kerosene, let alone to long-term contracts for PtL or eSAF at up to eight times the cost of conventional kerosene. Offtakers argue that prices may come down significantly well before long-term offtake contracts have come to an end and therefore will become uncompetitive.
There also are lingering concerns about some of the technology required for PtL or eSAF production plants. As a result, we are seeing a limited number of projects progressing to Final Investment Decision (“FID”) stage and almost none on the PtL or eSAF segment. No large-scale eSAF plants have reached FID and in recent months we have seen the likes of Shell cancel plans for a large-scale plant in Rotterdam. European airlines have also raised concerns about their ability to compete with airlines that will operate long-haul routes which avoid connections in the EU and therefore avoid the obligation to refuel with a SAF blend.
In the next article of the series, we will examine the interaction between the mandates and the Carbon Offsetting and Reduction Scheme for International Aviation, the respective emissions trading systems in the UK and EU, and proposals to unlock the investment required into production plants in the UK and EU. We will further consider the proposed approach to the revenue certainty mechanism under the UK SAF Mandate, including the UK government’s Advanced Fuels Fund competition and initiatives such as Project Skypower.
London Trainee Leann Thompson also contributed to this article.
[1] Annex IX Part B of the Renewable Energy Directive (RED I and II)
[2] Annex IX Part A of the Renewable Energy Directive (RED I and II)
[3] https://www.iata.org/en/iata-repository/pressroom/fact-sheets/fact-sheet-sustainable-aviation-fuels/
[4] Target milestones reflected as a summary. Detailed targets can be found in the ReFuelEU and the UK SAF Mandate regulations.
[5] https://eur-lex.europa.eu/eli/reg/2023/2405/oj/eng
[6] https://www.sustainableaviationfutures.com/saf-spotlight/sundyne-
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