Global Sustainable Aviation Fuel production is expected to reach 2.4 million tonnes in 2026, just 0.8% of aviation fuel use, as IATA warns that policy sequencing, financing, infrastructure and economics are slowing the transition needed to meet aviation’s net-zero ambitions.
Global (Tourism Reporter) — Nearly four months after IATA published its 2026 fuel estimates at the industry’s annual general meeting in Rio de Janeiro, one small number keeps casting a long shadow over aviation’s decarbonisation ambitions: 0.8 per cent.
That is the share of global jet-fuel consumption that Sustainable Aviation Fuel (SAF) is expected to represent in 2026 — around 2.4 million tonnes — five years after the aviation industry committed to achieving net-zero carbon emissions by 2050.
The ambition is measured in decades. The fuel supply is still measured in fractions of a per cent.
And that gap is about to come under another spotlight.
When IATA’s World Sustainability Symposium opens in Brussels on 13 October, bringing together aviation, energy, finance and policy leaders to tackle the economics and policy challenges of decarbonisation, SAF will once again sit at the centre of the conversation.
For the travel and tourism industry, this is not an aviation story happening somewhere above the clouds.
Tourism moves on aircraft, and aircraft move on fuel.
The price, availability and scalability of SAF therefore matter far beyond airline sustainability targets. They can ultimately influence the economics of air travel, the cost of connectivity and the ability of destinations to sustain the global flows of visitors on which their tourism economies depend.
And behind that seemingly modest 0.8 per cent lies a much bigger question:
Can aviation scale the green fuel it needs quickly enough — without making the economics of global air travel increasingly difficult to sustain?
That is the SAF problem Tourism Reporter is examining.
The Number: 0.8 Per Cent of a 321-Million-Tonne Fuel Bill
The number looks small. The gap behind it is anything but.
IATA expects global Sustainable Aviation Fuel (SAF) production to reach around 2.4 million tonnes (Mt) in 2026, up from 1.9 Mt in 2025 and 1 Mt in 2024. On its own, that looks like meaningful progress: production has more than doubled in two years.
But aviation does not run on SAF alone. Against roughly 321 Mt of global jet-fuel consumption, the 2.4 Mt of SAF expected this year amounts to just 0.8 per cent of the fuel the industry needs.
The industry is moving forward. It is just not moving fast enough.
SAF’s share is expected to rise from 0.6 per cent in 2025 to 0.8 per cent in 2026. Yet the annual increase in actual production is already slowing: output rose by roughly 0.9 Mt between 2024 and 2025, but is expected to add only about 0.5 Mt in 2026. IATA itself describes the trajectory as a slowdown in growth.
There is another number that makes the picture more revealing: more than 9 Mt of SAF production capacity is expected to exist in 2026, yet only around 2.4 Mt is forecast to be produced. In other words, the problem is no longer simply about building factories. A significant part of the capacity already exists but is being underutilised because of the economics, policy environment and competing uses for renewable fuels.
That is where Willie Walsh’s final assessment as IATA Director General carries particular weight. In June, just weeks before concluding his tenure, Walsh described 2026 as “another disappointing year” for SAF production, pointing to poorly sequenced government policies and what he called oil companies’ “manifest lack of interest” in the market.
The association had already revised its numbers once. In December 2025, IATA cut its estimate for 2025 SAF production to 1.9 Mt, from an earlier forecast of around 2 Mt, citing insufficient policy support to make full use of installed capacity.
So the story is not simply that SAF production is growing too slowly.
It is that the system is struggling to turn available capacity into affordable, usable fuel at the scale aviation needs.
And that distinction matters enormously for tourism.
Because somewhere between the refinery, the fuel supplier, the airline and the passenger sits the economics of the journey — and ultimately, the economics of tourism itself.
The Ambition: Net Zero by 2050, and a 65 Per Cent Bet on SAF
The scale of the gap only becomes clear when measured against the ambition SAF is expected to serve.
In 2021, IATA member airlines committed to achieving net zero carbon emissions by 2050. Within IATA’s roadmap, SAF is the load-bearing pillar of that transition, expected to deliver around 65 per cent of the carbon mitigation needed by 2050. That makes the industry’s current production trajectory more than a fuel-supply problem. It is a problem of whether one of aviation’s most important decarbonisation levers can be scaled quickly enough.
The volume required is enormous.
IATA estimates that aviation will need around 500 million tonnes of SAF every year by 2050. Against the 2.4 Mt expected in 2026, that means annual production must increase by more than 250 times over the coming decades. On Tourism Reporter’s arithmetic, today’s output is barely the opening line of a much larger equation.
The destination is 2050. The fuel supply still has a very long way to travel.
And the nearer-term milestones are beginning to look uncomfortable too.
Many airlines have publicly committed to using 10 per cent SAF by 2030. But in December 2025, Walsh warned that the failure to accelerate production would force many of those airlines to reconsider their commitments because SAF was simply not being produced in sufficient quantities to deliver them.
The pipeline helps explain why.
IATA’s analysis of announced SAF projects suggests that around 30 Mt of production capacity has been announced for 2030, but only about 60 per cent is expected to materialise. After applying project-success factors, IATA estimates actual global capacity could reach only around 20 Mt by 2030.
And even that 20 Mt rests heavily on one technology.
IATA’s feedstock assessment estimates that HEFA — Hydroprocessed Esters and Fatty Acids — could account for about 95 per cent of global SAF production in 2030. HEFA is the only mature SAF pathway capable of scaling in the near term and can turn feedstocks such as used cooking oil and other fats into aviation fuel. But its expansion is constrained by the availability of suitable feedstocks.
The alternative pathways are not yet filling the gap. IATA’s 2030 assessment puts Alcohol-to-Jet at around 2 per cent, Power-to-Liquid at 2 per cent and Fischer-Tropsch at about 1 per cent of projected production. Meanwhile, some of the technologies that could become increasingly important later in the transition remain commercially immature.
The ambition assumes a diversified SAF supply chain. The pipeline, for now, remains remarkably narrow.
That is the paradox at the heart of aviation’s green-fuel challenge: the industry has identified the scale of the destination, but much of the road to get there still depends on technologies, investment and feedstock systems that have yet to reach commercial scale.
And for tourism, that matters because the future of global connectivity is being built into the fuel supply chain long before the traveller ever reaches the airport.
The Capacity: More Than Nine Million Tonnes Sitting Underused
Perhaps the most revealing detail from IATA’s sustainability briefing in Rio is that the industry does not, strictly speaking, have a SAF capacity problem. It has a utilisation problem.
Global SAF production capacity is expected to exceed 9 million tonnes in 2026, yet actual production is forecast at only 2.4 Mt — meaning a substantial share of the available capacity will sit unused. IATA says the gap reflects a combination of inadequate policy support, uneven regional supply and, crucially, economics: renewable-fuel producers can often make more money producing renewable diesel (RD) than SAF.
Much of this capacity is flexible. The same facilities can produce different renewable fuels depending on the feedstock, market conditions and economics. The machinery can make the fuel. The market is deciding which fuel is worth making.
IATA’s briefing puts the issue bluntly: flexible SAF capacity is being underused because of the cost gap. Where policy incentives and market prices favour renewable diesel, producers have little commercial reason to divert output towards aviation fuel.
That reframes the SAF debate.
The constraint is no longer simply whether the industry can build production facilities. It is whether the economics can make aviation fuel the product producers actually want to make.
And the wider project pipeline tells a similarly uncomfortable story.
IATA’s latest project analysis shows around 200 SAF projects announced globally, representing up to 30 Mt of potential SAF production capacity by 2030. Yet IATA expects only about 60 per cent of that announced capacity to materialise, leaving actual capacity at around 20 Mt by 2030. It says as little as 35 per cent of announced capacity is currently operational or under construction, with policy support and access to funding among the factors holding projects back.
That distinction matters because an announced refinery is not a refinery, a planned project is not production, and production capacity is not necessarily fuel in an aircraft.
The SAF story is therefore becoming less about drawing bigger numbers on project pipelines and more about converting those numbers into operating facilities, commercially viable production and, ultimately, fuel that airlines can actually buy.
The industry has capacity on paper. What it needs now is the economic machinery to turn that capacity into tonnes.
And for tourism, that is a crucial distinction. A destination can plan for more air connectivity. An airline can commit to a greener future. But neither can manufacture the fuel that does not yet make economic sense to produce.
The Real Problem: Why Only 2.4 Million Tonnes Gets Made
If the capacity exists, why does only 2.4 million tonnes of SAF actually get produced?
The answer is increasingly visible in the economics.
SAF is competing in a wider energy market where producers have choices about what to make, investors have choices about where to put their money, and airlines ultimately have to absorb the cost of a fuel that remains substantially more expensive than conventional jet fuel.
Then 2026 delivered another complication: a violent shock to the underlying fuel market.
The average global jet-fuel price was around $96 a barrel in November 2025. By April 2026, it had roughly doubled, before easing to around $158 in May, according to IATA. The shock was driven by disruptions to global fuel supply and flows following the Middle East conflict.
SAF prices moved higher too. IATA reported that the average SAF price rose sharply during the period, adding another layer of difficulty to an already expensive fuel.
There is an uncomfortable irony here.
SAF is supposed to reduce aviation’s dependence on fossil fuels. Yet its economics remain closely tied to the fossil-fuel market it is intended to help replace.
Hemant Mistry, IATA’s Director of Energy Transition, described that relationship as problematic because the cost of SAF feedstocks is not directly determined by crude-oil prices. Yet airlines and producers still operate within a market where conventional jet fuel provides the dominant price reference.
The result is a peculiar economic equation: SAF can become more expensive at precisely the moment when airlines are already under pressure from higher fuel costs.
And that matters because the SAF premium is not trivial. IATA expects airlines to spend an additional $4.3 billion on SAF in 2026, even though the fuel will account for only 0.8 per cent of total consumption.
Geography makes the equation harder
Then there is geography.
SAF production is not evenly distributed around the world. IATA’s 2030 outlook puts North America at around 36 per cent of global SAF capacity, Europe at 23 per cent and Central and South America at 15 per cent. China is projected at around 13 per cent, with East Asia and the Pacific at around 12 per cent. Under current policy conditions, Middle East and North Africa and South Asia each account for less than 1 per cent.
That creates another structural challenge for an industry whose product is consumed globally.
The aircraft may be global. The fuel supply chain is not.
Production capacity is concentrated in particular markets, while airlines operate networks that cross continents. Moving SAF to where it is needed adds logistical complexity and reinforces the importance of mechanisms such as book-and-claim systems, which IATA argues are necessary to make SAF accessible beyond the location where it is physically produced.
For tourism, the implications are easy to miss.
A destination may have an airline willing to increase capacity, travellers willing to buy the seats and governments willing to support greener aviation. But none of those things guarantees that the fuel economics will cooperate.
Then comes the investment problem
Behind the production gap sits an even bigger question: why aren’t investors putting more money into SAF?
IATA’s answer is blunt: it is not simply a lack of money. It is a lack of expected returns.
Marie Owens Thomsen, IATA’s Senior Vice President Sustainability & Chief Economist, has argued that investors can see better returns elsewhere. Industry estimates cited by IATA put expected returns from SAF production at below 5 per cent, compared with roughly 20 per cent for oil investment. That is a difference of around 15 percentage points before an investor even begins weighing the additional technological, regulatory and market risks surrounding SAF.
Capital follows returns. SAF needs capital. And at current economics, the two are not meeting at the scale aviation requires.
The numbers required to close the gap are enormous.
IATA estimates that cumulative investment in SAF production could reach somewhere between $3 trillion and nearly $7 trillion by 2050, depending on assumptions around production yields.
Put that scale beside another industry competing aggressively for investment.
In 2024 alone, private investment in artificial intelligence reached about $217 billion. IATA notes that a single year of AI investment would be enough to cover the SAF production investment required through 2036.
That is not because SAF lacks importance.
It is because importance and investability are not the same thing.
AI can attract enormous pools of private capital because investors can see a path to potentially extraordinary returns. SAF is being asked to solve one of aviation’s most important long-term problems while offering investors a much lower return profile and carrying substantial policy, technology and market risk.
And that may be the deepest problem of all: aviation knows how much SAF it needs. The industry has identified where much of the capacity could come from. What it has not yet solved is how to make the economics compelling enough for capital to build it at the required speed.
That is why the 2.4-million-tonne figure matters.
The missing SAF is not simply missing fuel. It is missing investment, missing policy alignment, missing market incentives — and, ultimately, missing economics.
For an industry built around moving people across borders, that is where the sustainability story becomes a tourism story.
The Money: $4.3 Billion for Less Than One Per Cent
The economics become stark when the SAF bill is placed alongside the airline industry’s wider finances.
IATA estimates that the 2.4 Mt of SAF expected to be available in 2026 will cost airlines an additional $4.3 billion. That comes as the industry’s profitability is already under severe pressure: IATA has cut its 2026 global airline profit forecast from $41 billion to $23 billion, with a net margin of just 2.0 per cent. Fuel alone is expected to cost airlines $351 billion, or 31.4 per cent of operating expenses.
On Tourism Reporter’s arithmetic, the $4.3 billion SAF premium is equivalent to roughly 19 per cent of expected industry net profit. Spread across IATA’s forecast 5.1 billion passengers, it works out at about 84 cents per passenger, against expected net profit of just $4.50 per passenger. These are Tourism Reporter’s calculations, not IATA’s, and the burden is of course far from evenly distributed across airlines or markets.
But the bigger issue is where that money is being spent — and what airlines are getting for it.
In Europe and the UK, IATA says airlines paid a $2.9 billion premium for the 1.9 Mt of SAF available in 2025. Only $1.4 billion of that represented the underlying SAF premium over conventional fuel; another $1.5 billion came from compliance fees associated with mandated volumes.
That creates a particularly awkward equation: airlines can end up paying substantially more for a scarce product without receiving a corresponding guarantee of supply.
And that is how a global SAF shortage becomes a regional competitiveness issue.
For airlines operating in mandated markets, the cost of the transition is not simply the price of the greener fuel. It can also include the cost of policy design, market scarcity and compliance mechanisms layered on top of it.
The money is being spent. The question is whether enough of it is reaching the part of the system that actually creates more SAF.
The Policy Fight: Mandates Versus Incentives and Sequencing
IATA’s prescription rests on four priorities: expand renewable energy supply; open fuel infrastructure to fair competition; put production incentives and investment frameworks ahead of mandates; and build a global SAF market supported by book-and-claim accounting and harmonised standards. Its central argument is simple: mandating demand before supply exists can raise prices without raising volumes.
The e-SAF mandates are the clearest test. The EU and UK require around 0.6 Mt of e-SAF by 2030, yet global capacity operating or under construction is only about 0.02 Mt. IATA estimates that meeting the target would require roughly 20 commercial-scale plants, while no new final investment decisions were recorded over the past year. IATA economist Marie Owens Thomsen has called the targets “utterly detached from reality”, citing Europe’s high renewable electricity costs.
Under ReFuelEU, supply shortfalls can trigger fines and carry-over obligations. IATA estimates potential non-compliance costs could reach billions of euros if supply fails to materialise.
The counterargument is equally clear: mandates give investors the demand certainty needed to commit capital. IATA’s own data offers some support for that view, with North America expected to account for around 36 per cent of 2030 SAF capacity, helped by targeted incentives.
The real policy question, therefore, is not simply mandates versus incentives.
It is whether governments can build supply quickly enough for mandated demand to become a market — rather than simply another cost.
The Tourism Question: What Happens to Connectivity if the Transition Gets More Expensive?
For the visitor economy, the SAF debate is ultimately a debate about ticket prices and route maps. Airlines cannot absorb a rising decarbonisation bill indefinitely on a 2 per cent margin. The familiar responses are higher fares, thinner schedules on marginal routes, or both. Long-haul leisure routes, island and secondary destinations, and price-sensitive markets are particularly exposed because they combine higher fuel consumption with less room to pass on costs. Destinations served mainly by carriers operating under mandates could also face a structural disadvantage against competitors reached through markets with lighter obligations.
The demand side offers little reassurance that travellers will simply absorb the difference. IATA’s April passenger survey found strong support for decarbonisation, with 66 per cent willing to pay more to offset emissions and 88 per cent expecting fares to rise. But stated willingness is not the same as behaviour at the booking screen. UN Tourism’s latest Barometer recorded global arrivals growing just 0.4 per cent, with travellers increasingly prioritising value and choosing trips closer to home as costs rise. A more expensive transition, therefore, would arrive in a market with limited headroom.
The timetable adds urgency. ReFuelEU’s SAF requirement rises from 2 per cent in 2025 to 6 per cent in 2030, roughly 3.2 Mt of SAF for Europe alone, while the UK’s mandate follows a similar trajectory. Each step increases the volume airlines must secure while supply remains scarce. For destination marketing organisations, the questions are becoming practical: how much of that cost will appear in fares, which routes will feel it, and are their key source markets served by carriers exposed to these mandates?
Those are commercial questions, and they belong in tourism planning as much as in aviation policy.
None of this argues for slowing decarbonisation. It argues for getting the sequencing right. The 0.8 per cent figure is less a verdict on SAF than on the system around it: capacity exists, but economics and policy have yet to turn enough of it into affordable fuel.
For destinations, airlines and tourism businesses, SAF is no longer an environmental footnote. It is becoming a connectivity variable.
Source note: This report draws on IATA’s SAF production estimates and briefing materials presented at its Annual General Meeting in Rio de Janeiro on 6 June 2026, IATA’s economic outlook and sustainability presentations, and aviation industry reporting through September 2026. Comparative calculations made from IATA’s published figures are Tourism Reporter’s own.
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