UK signs SAF into law as Jet Zero Council gets makeover

opinion

by Fayaz Hussain

November 27, 2024

The UK has officially mandated the use of sustainable aviation fuel (SAF), marking a decisive step that contrasts sharply with the uncertainty seen in the US.

Mike Kane, Parliamentary Under-Secretary of State at the Department for Transport, put pen to paper this week following years of planning.

“Today, I officially signed the SAF mandate into law – meaning by 2040, 22% of jet fuel will come from sustainable sources. We’re serious about our commitment to the UK SAF industry and together, we’re leading the way towards greener air travel,” he said.

The legislation, which becomes effective from January 1, 2025, establishes a progressive framework that begins with a 2% SAF requirement, increasing to 10% by 2030.

The industry response has been notably positive. LanzaJet, a key player in SAF production, celebrated the mandate’s signing, particularly highlighting its importance for Project Speedbird, its collaboration with British Airways and Nova Pangaea Technologies in UK. The company emphasised how the mandate’s provisions, including strategic caps on HEFA feedstocks, will encourage “the development of advanced fuels” and ensure “the growth of a diverse and resilient SAF supply chain”.

To support the transition, the legislation includes crucial financial mechanisms. A revenue certainty mechanism aims to encourage investment in new UK-based SAF plants with SAF buy-out options set in the range of £4.70 ($5.9) and £5.00 ($6.25) per litre to incentivise production.

“We welcome the support of the UK government in building a robust and sustainable domestic SAF industry through legislation of the SAF mandate and continued progress of the revenue support certainty mechanism, expected in 2026,” said Sarah Ellerby, CEO, Nova Pangaea Technologies.

She highlighted how these measures are “critical to attracting required investment into the nascent SAF industry” and will help establish the UK as a “global leader in SAF.”

While the SAF mandate signing marks a significant step forward, SAF Investor has learned that the UK’s Department for Transport has disbanded the Jet Zero Council just weeks ahead of the mandate.

In a letter seen by SAF Investor, Transport Secretary Louise Haigh has informed the Jet Zero Council members that her government intends to build the work done by its members under a new group called the “Jet Zero Taskforce”.

The Jet Zero Council, which held its final meeting on April 18, 2024 after 10 sessions since July 2020, brought together key industry players including Velocys, British Airways, Airlines UK and Boeing. During its last meeting, the council specifically addressed the critical timing gap between the SAF mandate’s 2025 implementation and the revenue certainty mechanisms slated for 2026 – a key concern for securing SAF plant financing.

The new taskforce will operate with a different structure, featuring a CEO-level annual plenary and an expert group of sustainability leads. Although the goal with this restructuring is to make the body more agile, the move comes at a sensitive time for SAF in the UK.

The timing of this organisational change, occurring just weeks before the mandate takes effect, raises questions about the continuity of ongoing work on the revenue certainty mechanism. The mechanism, viewed by industry leaders as crucial for attracting investment in new SAF plants, requires careful coordination and continued momentum to meet its 2026 implementation target.

The success of the UK’s SAF ambitions may well depend on how smoothly the new taskforce can maintain progress on these critical financial support measures.