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The sustainable aviation fuel market size is forecast to increase by USD 1,978 million and is estimated to grow at a CAGR of 59.08% between 2023 and 2027. The report includes historic market data from 2017 to 2021. The aviation industry is witnessing key market trends, including the exploration of third-generation biofuels, stricter environmental regulations, and the pursuit of enhanced airline efficiency. These trends are driving significant changes in the industry as it aims to promote sustainability, reduce emissions, and optimize operational practices.
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The exploration of third-generation biofuels is a significant trend in the market. Unlike first-generation biofuels from vegetable oil and animal fats, and second-generation biofuels from feedstock, third-generation biofuels are derived from algae, offering various advantages over other sources. Algae-derived biofuels include biodiesel, butanol, gasoline, methane, ethanol, vegetable oil, and jet fuels, providing higher quality and greater yield. The cultivation of microalgae for biofuel production, with its high lipid content, further expands the potential of sustainable aviation fuel, driving growth in the market during the forecast period. The integration of these advanced fuels with cutting-edge technology is expected to play a crucial role in the expansion of the sustainable aviation fuel market.
The biofuel segment is estimated to witness significant growth during the forecast period. There has been a focus by regulatory bodies like grading aircraft based on carbon emissions and pollution to reduce emissions by the aviation industry. Hence there has been an increasing focus by aircraft and aircraft component manufacturers to reduce aircraft emissions, which is likely to result in the growth of the Sustainable Aviation Fuel (SAF) Market. Various stakeholders are involved in making the energy requirements of the aviation industry sustainable. They include the International Civil Aviation Organization (ICAO) and the Commercial Aviation Alternative Fuels Initiative (CAAFI) which are working to make sustainable aviation biofuel more commercially viable.
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Despite being a possible alternative to conventional fuels, biofuels have limitations such as low availability and various challenges such as lobbying from the conventional fossil fuels market. However, the increased government emphasis on targets and incentives is likely to improve the growth of the global aviation biofuel market during the forecast period.
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North America is estimated to contribute 39% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The robust aviation base in North America and the global demand for new aircraft has resulted in substantial investment in manufacturing more efficient aircraft systems. This is likely to have an impact on the SAF market in the region, especially in the US. The US is predicted to be the global leader in integrated biorefinery manufacture that can generate bio-based jet fuel and marine distillates. To improve the economic viability and expand R and D into the SAF Market, incentives like special category loans, grants, and funds have been used. This support has expanded research in the sustainable aviation fuel market and expanded the viability of the SAF market by improving biodiesel quality. Additionally, due to the high market rates of biodiesel, the government provides subsidies and other incentives for its usage. All these factors are likely to result in the growth of the sustainable aviation fuel market during the forecast period.
The COVID-19 outbreak negatively impacted the sustainable aviation fuel market in the region. Various non-essential and non-urgent manufacturing of consumable fuels were closed and this negatively impacted the Sustainable Aviation Fuel (SAF) market. However, after large-scale vaccination drives initiated in governments, there was a resumption of operations of manufacturing plants. Hence it is predicted there will be further market growth during the forecast period.
Favorable government policies are driving the market growth for sustainable aviation fuels. Environmental and energy security concerns have increased the demand for renewable fuels like cellulosic ethanol and biodiesel. Governments in countries such as Germany and India are actively promoting their use through targets and incentives. For instance, the EU's Renewable Energy Directive aims for 10% of transportation energy from renewables by 2020. Tax credits and grants further incentivize adoption, leading to increased production and consumption of sustainable aviation fuels globally. This trend is expected to continue driving the market growth during the forecast period.
The market growth is hindered by the higher cost of production compared to conventional fuels. Current technology for sustainable aviation fuel production is inefficient and not economical, requiring a more sustainable and efficient processing technique. Electric vehicles are considered a more economical and sustainable alternative, posing challenges for sustainable aviation fuels in carbon emission reduction. The ever-dynamic energy landscape and high costs of sustainable aviation fuels are impeding market growth during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Sustainable Aviation Fuel Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Eni SpA - The company offers sustainable aviation fuels such as Eni Biojet.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The sustainable aviation fuel market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
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Sustainable Aviation Fuel Market Scope |
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Report Coverage |
Details |
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Page number |
172 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 59.08% |
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Market growth 2023-2027 |
USD 1978 million |
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Market structure |
Fragmented |
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YoY growth 2022-2023(%) |
56.67 |
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Regional analysis |
North America, APAC, Europe, Middle East and Africa, and South America |
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Performing market contribution |
North America at 39% |
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Key countries |
US, Canada, China, India, and Germany |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Aemetis Inc., Alder Energy LLC, Chevron Corp., Cummins Inc., Deutsche Lufthansa AG, Eni SpA, Fulcrum BioEnergy Inc., Gevo Inc., LanzaTech Global Inc., Neste Corp., OMV Aktiengesellschaft, Pan Oleo Energy Ltd., Preem Holdings AB, Sasol Ltd., Shell plc, SkyNRG BV, SYNHELION SA, TotalEnergies SE, Velocys Plc, and World Energy LLC |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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