The Largest Gap in Aviation is Not Just SAF Supply, but Blending Capabilities

Aviation is under growing pressure to decarbonise and Sustainable Aviation Fuel (SAF) is the heart of this transformation. With SAF production projected to reach 2.1 million tonnes in 2025 as reported by IATA, this amounts to only 0.7% of total jet fuel production. This limited supply, combined with high production costs, results in SAF being at least double the price of conventional jet fuel. These challenges highlight the importance of optimising blending capabilities to unlock SAF’s full potential.  

Why Blending Matters for the SAF Supply Chain? 

Unlike Jet A-1, which has a well-established and efficient supply chain, SAF introduces a key complexity: blending. Jet A-1 is delivered as a ready-to-use product, while SAF requires blending with conventional jet fuel to meet technical specifications before use. 

Currently, blending is predominantly carried out upstream by fuel producers. This approach is convenient as it centralises operations at existing production facilities, streamlining initial SAF processing and certification. This, however, leads to limited flexibility and scalability in the supply chain. It restricts the ability to adjust blend ratios closer to point-of-use and often results in a reduced ability to respond to varying regional SAF demands. In addition, many midstream and downstream stakeholders lack the infrastructure to handle blending operations, perpetuating inefficiencies and contributing to the price premium of SAF. While supply chain inefficiencies are not the sole reason for the price premium, this gap remains one of the contributing factors to the premium today and addressing this bottleneck can help foster a more adaptable and scalable SAF supply chain. 

Supporting ReFuelEU 

The ReFuelEU Aviation Initiative mandates increasing SAF usage across Union airports to decarbonise aviation. Starting in 2025, fuel suppliers must ensure SAF constitutes at least 2% of an airport's fuel volume, escalating to 70% by 2050. It’s important to note that ReFuelEU does not dictate specific SAF blend ratios, giving suppliers flexibility to determine their own supply chain, provided minimum requirements are met.   

Specifically, to meet the Flexibility Mechanism (Article 15), suppliers can average SAF supply across Union airports, enabling strategic decisions on where blending takes place - whether upstream, midstream, or downstream. This flexibility supports efficient resource allocation and compliance while easing logistical burdens.  

Airport operators, too, play a crucial role under ReFuelEU. They are legally obligated to facilitate SAF access for airlines, ensuring a reliable and scalable supply. Although the specific measures are undefined, enhancing blending capabilities either at the airport or at key points along the supply chain can be a viable solution to fulfil this mandate. 

Bridging the Blending Gap 

Strengthening blending infrastructure is not just a short-term fix but a necessary step toward creating a more efficient and cost-effective SAF supply chain. This includes investing in midstream terminals capable of integrating SAF blending into existing logistics networks, establishing downstream infrastructure near high-demand airports for blending, and leveraging digital technologies to monitor and optimise fuel distribution. These enhancements are critical for supporting SAF adoption by reducing transport inefficiencies, increasing supply flexibility, and lowering overall costs. By establishing strategic midstream and downstream blending capabilities, stakeholders can better position themselves to meet regulatory requirements, reduce operational inefficiencies and ease the price premium associated with SAF. These improvements will enable a more dynamic and resilient fuel supply chain, ultimately benefiting airlines by reducing costs and enhancing SAF accessibility.