On aviation fuel, environment, and sustainability

How Sustainable is Sustainable Aviation Fuel (SAF)? And is it a Good Investment?

As the aviation industry faces mounting pressure to decarbonize, Sustainable Aviation Fuel (SAF) has emerged as one of the most talked-about solutions. But how sustainable is it, really? And does it hold long-term value for investors?

What is SAF?

SAF is produced from renewable feedstocks like used cooking oil, agricultural waste, and even algae. Compared to conventional jet fuel, SAF can reduce lifecycle greenhouse gas emissions by up to 80% (according to IATA), if produced and used correctly.

The Challenges:

Feedstock availability: Global feedstock supply is limited. Even if every drop was used for SAF, it would still only meet about 5% of aviation fuel demand.

Cost premium: SAF is currently 2–5 times more expensive than conventional jet fuel.

Infrastructure and scalability: Retrofitting refineries and ensuring regulatory alignment is costly and slow.

The Opportunities:

Policy momentum: Governments are introducing SAF mandates, like the EU’s RefuelEU Aviation initiative requiring 6% SAF use by 2030.

Corporate demand: Major airlines and cargo players are locking in SAF supply agreements to meet Scope 3 emission targets.

Innovation: Emerging technologies (e.g., Power-to-Liquid e-fuels) promise more scalable and carbon-neutral SAF production in the next decade.

So, is it a good investment?

Yes, but selectively. The most promising investment plays are in:

- Feedstock innovation (e.g., waste-to-fuel tech, algae biofuel)

- Electrofuels (for longer-term gains)

- Vertical integration—companies securing the full SAF value chain

- Public-private partnerships in regions offering incentives or subsidies

SAF is not a silver bullet, but it’s a critical piece of the decarbonization puzzle. For investors with a long-term, impact-driven horizon, SAF offers a mix of risk, reward, and real-world impact, if backed by smart policy and technological breakthroughs.

Is your portfolio ready for a low-carbon aviation future?