The market tools and financial mechanisms scaling sustainable aviation fuel

Sustainable aviation fuel (SAF) offers the fastest route to decarbonising flight, cutting lifecycle emissions by up to 80%. Yet scaling production requires more than fuel innovation alone. As Founder and CEO of World Energy Gene Gebolys explains, new market tools such as SAF certificates and Book and Claim systems are reshaping how companies invest in cleaner flight - mobilising capital, bridging supply and demand, and accelerating aviation's transition towards a net zero future.

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Aviation connects people and goods across the globe, driving more than US $4.1 trillion in annual turnover - around 3.9% of global GDP. Yet these personal and economic benefits come with a cost. Aviation accounts for over 2% of global emissions and as demand for aviation grows, it's more important than ever to look for solutions.
Sustainable aviation fuel (SAF) - a biofuel made from renewable feedstocks like agricultural waste fats, oils, greases and certain cover crops - offers the fastest path to decabonising flight, with the potential to cut lifecycle emissions by up to 80% over its lifecycle.

To scale this solution, innovation must extend beyond the fuel itself. New market tools and financial mechanisms are helping bridge the gap between limited supply and growing demand. SAF certificates and Book and Claim systems are redefining how companies can invest in cleaner flight - unlocking capital, building market confidence and accelerating aviation's journey to net zero.

The solution and challenge of sustainable aviation fuel

Sustainable aviation fuel is a drop-in fuel solution, meaning it can be used in existing aircraft engines and infrastructure without any modifications, and it has already safely powered over 900,000 flights, according to the Aviation Transport Action Group.

However, costs of feedstocks and new infrastructure to produce sustainable aviation fuel makes it currently two to three times more expensive to produce than fossil jet fuel. And, since airlines operate on thin margins, it's difficult for them to pay for a premium product like SAF. These challenges have slowed the capital investments necessary to achieve economies of scale and bring down prices. In 2024, sustainable aviation fuel accounted for only about 0.3% of all aviation fuel and was available at only a fraction of the world's airports.

But airlines aren't the only players that matter here. Some of the biggest sustainable aviation fuel customers in recent years have been corporations looking to address the emissions from flying their people and goods around the world. Their involvement has led to game changing decarbonisation mechanisms in use today.

New market tools and financial mechanisms to grow SAF demand

Two tools in particular have become vital to expanding sustainable aviation fuel demand and scaling the industry: SAF certificates (SAFc) and Book and Claim. SAF certificates are a way for companies to support sustainable aviation fuel even if they don't physically use the fuel itself. For example, while SAF might not yet be readily available at all airports, SAF certificates allow companies to nonetheless purchase and claim the emissions reduction value of SAF against its own aviation emissions, while the actual fuel might be used elsewhere. SAFc are also known as 'insets' because the emissions and mitigation occur within the same sector. This model helps to scale the demand and investment in sustainable aviation fuel, even before wide physical distribution is readily available.

Book and Claim makes it possible to track both the physical fuel and its environmental attributes, just like a bank digitally tracks currency transactions. The fuel and the environmental attributes are tracked on a transparent SAFc registry from the time they are created until they are claimed, or retired, by the purchaser. With this model, multiple customers can share the cost premium, further expanding the market and lowering the price for everyone.

These tools were originally conceived and developed by the World Economic Forum and Rocky Mountain Institute, two organisations focused on market-based ways to mitigate climate change. The theory holds that corporations with strong balance sheets and the ability to commit to longer-term contracts will demonstrate durable demand, which in turn gives investors the confidence to finance new projects, ultimately growing supply.

Leading the commercialisation and partnering on SAF contracts

Verified emission reduction tools like SAFc bring the right customers, who want to cut emissions, to the table. World Energy recognises the potential of these measures and took steps to commercialise these tools in 2023 by partnering with first movers such as Microsoft, DHL and Boston Consulting Group on long-term SAFc contracts. These collaborations focused on ensuring the integrity of the SAF emissions reductions with a trustworthy ecosystem of standard setters, auditors and digital registries.

To date, World Energy SAFc contracts alone, including those which run years into the future, add up to about 2.9 million metric tonnes of carbon dioxide equivalent (MTCO2e) reduced. That's equal to flying more than 9.7 million economy class passengers from Heathrow, London, to JFK, New York, without CO2 emissions.

Others have followed suit. The Sustainable Aviation Buyers Alliance (SABA) achieved a milestone in 2024 by aggregating decarbonisation demand from nearly 20 companies to abate about 500,000 MTCO2e, bringing a historic total of US $200 million into the current SAF industry. Much more work is needed, but the growth of SAFc registries reflects the increasing recognition that these tools can accelerate decarbonising the aviation industry.

Opportunity for action across industries

The system to use insets and Book and Claim to power corporate investment in high value climate solutions is most mature in the aviation sector, but it's taking root in other hard-to-abate sectors like cement, steel, maritime shipping and rail cargo. We like to say that this approach will eventually decarbonise everything from cars to coffee cups.

There are still gaps to fill. Reliable public policies, uniform standards for sustainability and formal acceptance of these tools by carbon accounting leaders are essential to ensuring robust, effective action. But when it comes to the trillions of investment dollars needed to scale new infrastructure, bringing corporate customers for Scope 3 decarbonisation into the market is one of the surest ways to demonstrate bankable demand for large investors. First movers have shown how to put the SAF approach to use. The door is wide open for the next wave of companies to do the same.

2025 is a critical year for the Paris Agreement. Ten years on, we need to rethink how we frame the challenge. And seeing challenges differently is what business and we are all about.

ICC is committed to securing what businesses need at the upcoming climate negotiations, COP30, in Belém, Brazil. Learn more about our Opportunity of a Lifetime climate campaign and how to get involved.

*Disclaimer: The content of this article may not reflect the official views of the International Chamber of Commerce. The opinions expressed are solely those of the authors and other contributors.