Europe Dangers Shedding Its Early E-Fuels Lead for Aviation, Research Warns

Because the aviation sector gathers on the Worldwide Paris Air Present, a brand new T&E examine highlights Europe’s potential to be an e-kerosene trailblazer – essentially the most scalable sustainable aviation gasoline (SAF) – however extreme bottlenecks imply it may lose its first mover benefit.

Europe a pacesetter on e-kerosene bulletins, laggard on implementation

A brand new T&E examine exhibits that Europe could be a chief in e-kerosene (additionally referred to as e-SAF), housing greater than half of the world’s introduced manufacturing capability. Round 40 large-scale initiatives [1] are deliberate in Europe, with a possible e-kerosene manufacturing capability of shut to three million tonnes (Mt) per 12 months — roughly 5% of the gasoline that Europe’s aviation sector must function.

Europe’s early lead within the e-kerosene market has been pushed by the EU’s regulation on sustainable aviation fuels, ReFuelEU, which set particular targets for utilizing e-fuels in aviation. If all of the introduced initiatives had been constructed, the EU may meet these targets — however not one of the large-scale crops recognized on this report are even below building. Solely 4 are at a sophisticated stage [2], and none have reached a ultimate funding resolution (FID). This gradual progress is because of an array of challenges, with financing posing the largest barrier, and conventional gasoline suppliers being notably absent from the dialog.

Camile Mutrelle, Aviation Coverage Officer at T&E, stated: “The EU’s regulation on sustainable aviation fuels kick-started an e-kerosene revolution in Europe — however gasoline suppliers are usually not cashing in on this potential. With out extra ultimate funding selections, the EU’s 2030 goal and plans to prosper from inexperienced aviation will fail. To succeed, these initiatives want a secure authorized framework, as offered by ReFuelEU, and funding by way of an array of public help mechanisms and personal capital investments.”

With a possible to chop CO₂ emissions by greater than 90% in comparison with fossil kerosene, e-kerosene is vital to decarbonising aviation, an emission-intensive business that’s projected to maintain on rising [3]. As representatives of the business collect on the Worldwide Paris Air Present right now, an occasion showcasing the expansion, prowess and newest improvements in aviation, the examine’s findings spotlight that regardless of progress, the trail to considerably decreasing aviation emissions by way of really sustainable options stays lengthy and complicated.

Whereas Europe is at present the chief for e-kerosene [4], different markets are creeping up. China is the second-largest hub – round 10 large-scale initiatives have been introduced right here, representing round 20% of world capability. America can be choosing up the tempo, with the most important e-kerosene offtake settlement to this point secured by a US-based startup, and one of many world’s first FIDs for a large-scale e-kerosene plant secured in Could by Infinium, one other US-based startup [5].

Funding bottlenecks and oil majors are hampering progress

Regardless of beneficial situations, e-kerosene initiatives proceed to face important hurdles in Europe, together with challenges associated to vitality prices, infrastructure, and CO₂ sourcing. Regulatory uncertainty can be within the combine, led to by business stress [6] to delay ReFuelEU’s SAF targets in anticipation of the scheduled evaluation of the laws in 2027

Financing poses the largest barrier, with every plant requiring €1–2 billion in capital, bringing whole capital necessities to €10 – 20 billion by 2030. EU funding mechanisms for e-kerosene are usually not robust sufficient to help the extent of funding wanted to get these initiatives off the bottom, and conventional gasoline suppliers are notably absent from the dialog. Thus far, main oil firms have made negligible contributions to e-kerosene, whereas persevering with to spend billions on fossil fuels.

“Regardless of their big monetary capability, main oil firms are largely absent from the e-kerosene market,” Camile Mutrelle acknowledged. “Startups have taken the lead, however lack the inner assets to finance the capital-intensive infrastructure that’s urgently wanted. Getting oil majors on board and EU financing mechanisms as much as scratch will give e-kerosene the lift-off it wants. The upcoming Sustainable Transport Funding Plan is an opportunity to set the correct flight path by prioritising e-SAF, offering a complete mechanism to handle the challenges EU initiatives face.”

T&E urges EU leaders to reaffirm their dedication to the prevailing ReFuelEU targets, particularly within the run-up to the laws’s scheduled evaluation, and prioritise e-kerosene within the Sustainable Transport Funding Plan (STIP). It additionally requires a European market middleman utilizing a double-sided public sale mechanism to be established to handle the present points round financing.

Notes to the editor:

[1]  Massive-scale initiatives are outlined as ones with a manufacturing capability of greater than 10,000 tonnes of e-kerosene a 12 months.

[2] This implies the challenge is both present process the Entrance-Finish Engineering Design (FEED) part or pending ultimate funding resolution (FID) after finishing their FEED.

[3]  T&E, 2025. All the way down to earth: Why European aviation must urgently tackle its development drawback

[4] The highest 5 markets when it comes to introduced manufacturing capability are France (0.8 Mt), Norway (0.3 Mt), Finland (0.3 Mt), Sweden (0.3 Mt) and the Netherlands (0.3 Mt), international locations which boast low-carbon grids and robust renewable vitality assets. France is house to essentially the most introduced initiatives in Europe (11), doubling its initiatives and manufacturing capability since final 12 months.

[5]  The Infinium challenge is ready to supply as much as 23,000 tonnes of e-fuels per 12 months.

[6]  Monetary Instances, 2025. “European airways urge EU to drag again on local weather insurance policies”

Obtain the complete T&E evaluation of the worldwide e-SAF market.

Information launch from T&E.