The UK government has taken a significant step toward making sustainable aviation fuel (SAF) more viable by launching a public consultation on an SAF revenue support scheme. This initiative, which began on March 3, seeks to create financial stability for SAF producers while ensuring that costs remain manageable for both the aviation industry and consumers.
This effort aligns with the UK SAF mandate, which took effect on January 1, 2025, requiring airlines to use a minimum percentage of SAF in their fuel mix. With ambitious goals to scale SAF usage to 10% by 2030 and 22% by 2040, the revenue support scheme is designed to mitigate risks and accelerate the transition to cleaner aviation fuels.
The Need for a Revenue Support Scheme
SAF production is still in its early stages, and producers face considerable financial uncertainties due to fluctuating costs and evolving demand. The revenue certainty scheme is intended to provide price stability, making investment in SAF production more attractive.
The government’s preferred approach to funding this scheme is through a levy on jet fuel suppliers, ensuring that industry stakeholders contribute to its success. This model is similar to existing mechanisms used to support renewable electricity and hydrogen production.
How the Levy System Will Work
The levy would be designed to cover both SAF producer payments and administrative costs. Initially, variations in levy amounts are expected due to market volatility, particularly as non-HEFA SAF (Hydroprocessed Esters and Fatty Acids) prices fluctuate. The government anticipates that adjustments may be required between collection periods, using forecasted interim levies and subsequent reconciliations to ensure fairness and accuracy.
Before implementing the levy, extensive engagement with industry stakeholders will take place to refine the details, including:
- How the total levy amount and individual contributions will be determined.
- The collection and enforcement mechanisms.
- The obligations of aviation fuel suppliers under the scheme.
Industry and Consumer Considerations
A key priority of the revenue certainty scheme is balancing industry investment with consumer affordability. The UK Department for Transport has stated that any resulting cost increases for consumers are expected to align with typical airline ticket price variations, ensuring that air travel remains accessible while supporting sustainability goals.
By providing long-term revenue certainty, the scheme is expected to drive investment in new SAF production facilities and innovations, ultimately leading to increased SAF availability and cost reductions over time.
Building on Previous Consultations
The current public consultation follows an earlier consultation in April 2024, as well as the announcement of the SAF Revenue Support Mechanism Bill in mid-2024. This ongoing dialogue underscores the government’s commitment to establishing a well-informed, effective framework for SAF development.
Public Participation and Next Steps
Stakeholders, including airlines, fuel suppliers, environmental groups, and the general public, are invited to provide feedback on the proposed revenue support mechanism. The consultation is open until March 31, and additional details can be found on the UK Department for Transport’s website.
Once the consultation period concludes, the government will refine its approach based on stakeholder input before introducing legislation to formalize the scheme.
Conclusion
The UK’s public consultation on the SAF revenue support scheme marks a crucial milestone in advancing aviation sustainability. By addressing financial risks for SAF producers while ensuring that industry and consumer interests are safeguarded, this initiative has the potential to accelerate the widespread adoption of SAF.
As the consultation progresses, industry engagement will be essential in shaping a framework that effectively supports SAF production, fosters investment, and ensures long-term environmental benefits for the aviation sector.