Understanding the Shift: Moving Beyond Fuel to Carbon Markets
A quiet yet transformative development is unfolding in the world of sustainable aviation. Gevo, a clean energy pioneer, and Future Energy Global (FEG), a market accelerator, have inked a multi-year agreement that has the potential to reshape how airlines and corporates approach carbon reduction. More than just an offtake contract, this is a glimpse into the maturing landscape of Scope 1 and Scope 3 carbon credits, harnessed through Sustainable Aviation Fuel (SAF).
Under the agreement, Future Energy Global will acquire the carbon abatement attributes from 10 million gallons per year of fuel produced at Gevo’s upcoming facility, the ATJ-60. These attributes cover both direct airline emissions (Scope 1) and the indirect emissions linked to business travel (Scope 3). With an option to increase this offtake volume later, the scale and ambition of the agreement reflect an evolving vision for decarbonization beyond physical fuel supply.
Book and Claim: Expanding the Reach of Sustainable Aviation
A noteworthy aspect of this collaboration is its emphasis on the book and claim system. Traditionally used in renewable electricity markets, this approach separates environmental attributes from the physical product. In aviation, this means companies can claim the emissions reduction benefits of SAF even if the fuel is not physically delivered to their location.
This model is crucial because SAF is not universally available at every airport. By decoupling the environmental benefits from fuel logistics, book and claim systems unlock access to a broader, global pool of SAF-derived carbon credits. This enables airlines and corporates alike to bridge the gap between sustainability ambitions and operational realities.
Financing the Future: Infrastructure Powered by Innovation
The commercial logic of this agreement extends well beyond environmental aspirations. For Gevo, the partnership with Future Energy Global provides critical momentum toward financing the construction of its ATJ-60 plant in South Dakota. Backed by a conditional loan guarantee from the U.S. Department of Energy, alongside equity from project-level investors, the facility is designed to produce 60 million gallons of SAF annually.
What stands out is not just the facility’s capacity but its economic proposition. Gevo’s ATJ-60 aims to deliver SAF at a price comparable to conventional jet fuel, but with significantly lower carbon emissions. This parity is a pivotal step toward mainstreaming SAF in an industry where cost competitiveness remains a critical barrier to adoption.
Bridging Scope 1 and Scope 3: A Holistic Approach
One of the understated yet powerful features of this initiative lies in its dual focus on Scope 1 and Scope 3 emissions. Airlines, as fuel users, are directly accountable for Scope 1 emissions. Meanwhile, businesses whose employees fly for work bear responsibility for their share of flight-related emissions under Scope 3.
Future Energy Global’s ability to serve both scopes enables a more comprehensive decarbonization strategy. By catering to corporates eager to mitigate travel emissions and airlines looking to align with net-zero targets, this partnership creates a shared value chain of accountability and action.
Scaling Ambitions: Meeting the Urgency of Demand
The aviation sector faces a steep climb toward its 2050 net-zero goal, with estimates suggesting SAF production needs to increase over 400-fold. This is not merely a technical challenge but a financial and systemic one.
Future Energy Global’s business model provides a blueprint for scaling SAF production responsibly. By pre-purchasing SAF credits and commercializing the associated carbon benefits, FEG generates predictable revenue streams. This stability attracts capital and encourages producers like Gevo to expand with confidence. It also grants buyers access to SAF credits at transparent prices, fostering trust in a market that is still gaining maturity.
Enabling Early Movers: Opportunities Beyond Aviation
While the initial focus is on aviation, the implications of this partnership reach further. Future Energy Global is already extending its sustainable fuel credit solutions to marine and land transport sectors. This diversification is vital, as global logistics and freight systems seek to navigate the complex path toward lower emissions.
Moreover, aircraft lessors—who own about half of the commercial fleet globally—stand to benefit. By leveraging book and claim systems, they can contribute meaningfully to emissions reductions, enhancing the environmental profile of their assets while supporting their airline customers.
Conclusion: An Evolving Landscape of Shared Responsibility
The Gevo and Future Energy Global agreement signals a pivotal shift in how industries perceive their role in decarbonization. Beyond merely supplying sustainable fuel, this partnership demonstrates the power of market-based mechanisms to accelerate the energy transition.
Rather than waiting for global SAF infrastructure to catch up, this agreement empowers businesses to take proactive steps now. It blends technological readiness with financial innovation, creating a practical pathway for industries to advance toward climate goals. And perhaps most importantly, it reframes emissions reduction as a shared responsibility—one that spans producers, buyers, investors, and society at large.
As the demand for credible, scalable climate solutions intensifies, initiatives like this provide more than compliance—they offer a blueprint for collaboration, resilience, and sustainable growth.