DOE Liftoff Report: Sustainable Aviation Fuel Promises Lofty Decarbonization Future

The future of sustainable aviation fuel could take off to create $44 billion of investment and make up 10% of U.S. jet fuel demand by the start of the next decade, according to a new report.

The U.S. Department of Energy (DOE) has released its Pathways to Commercial Liftoff report, which highlights the near-term potential for sustainable aviation fuel (SAF) to decarbonize the aviation sector.

The report analyzes the technical and commercial readiness of several SAF production pathways and demonstrates concrete, actionable steps for both the public and private sector to make the U.S. a global leader in SAF production by 2030. The Liftoff series promotes alignment on market challenges, investment needs, and critical pathways for deploying sustainable solutions, such as SAF, at scale.

“With the aviation sector growing each year, there is no better time to invest in solutions that are both technologically and commercially ready today,” said U.S Secretary of Energy Jennifer M. Granholm. “The latest in DOE’s Liftoff series, this report lays out the critical innovations and investments needed to drive down costs and further scale SAF production—paving the way for a cleaner, more competitive aviation sector that will benefit communities and businesses nationwide.”

Key findings from the report include: 

• Announced projects represent over three billion gallons of annual domestic SAF production capacity by 2030, surpassing the U.S. SAF Grand Challenge target. This announced capacity correlates to over 10% of projected U.S. jet fuel demand, over $44 billion of investment, and over 70,000 jobs across the SAF value chain through 2030.
• SAF liftoff by 2030 will require accelerated deployment of production technologies and feedstocks that are readily available today. In parallel, investments in emerging SAF technologies (e.g., next-generation feedstocks, innovative SAF conversion technologies, etc.) are essential to ensure that 100% of jet fuel can be sustainable by 2050.
• SAF currently costs two to ten times more than fossil jet fuel, depending on the feedstock and conversion technology used to produce it. Federal and state incentives play a necessary role in helping make SAF more cost competitive with fossil jet. However, sustained price premiums have limited airlines’ voluntary offtake.
• Long-term offtake agreements will establish the demand certainty required to improve financing terms and stimulate investment across the SAF value chain. Airlines and producers can extend terms or increase volumes by activating third-party offtakers that are willing to pay for the environmental attribute (carbon abatement) of this low-carbon fuel to reduce their Scope 3 emissions. This activation will require the incorporation of SAF in Scope 3 emissions standards.
• SAF liftoff will require international policy coordination, including alignment on carbon accounting, feedstock traceability, and book and claim systems.

Loans Investing in SAF Production

The SAF Liftoff report adds to two conditional commitments announced by DOE’s Loan Programs Office (LPO) in October 2024 to scale domestic SAF production. LPO’s $1.44 billion loan guarantee to Montana Renewables, if finalized, will help finance the expansion of a renewable fuels facility in Great Falls, Montana, to utilize vegetable oils, fats, and greases to produce SAF, renewable diesel, and renewable naphtha.

LPO’s $1.46 billion loan guarantee to Gevo Net-Zero 1, will help finance a corn starch-to-jet fuel facility in Lake Preston, South Dakota. The facility will source U.S.-grown, low-cost, low-carbon field corn and will use carbon capture and sequestration and renewable power to lower emissions. 

SAF and E-Mobility in the C&I Energy Transition

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