North America Sustainable Aviation Fuel Market: Current Analysis and Forecast (2024-2032)

The North America Sustainable Aviation Fuel Market is growing at a steady rate of 32.8% in the forecast period, owing to increased environmental regulations and emissions reduction targets. The transportation sector is a significant source of emissions worldwide, including in North America. Today, aviation (including all non-military movements within and outside the USA) accounts for 11% of US transportation emissions. In response, these regulations and targets seek to inhibit greenhouse gas emissions, enhance air quality, and espouse sound environmental measures. Also, the world's countries have defined concrete goals for reducing GHG emissions and the targets of reaching zero emissions. The United States has set to achieve net zero emissions by 2050, and adopting sustainable aviation fuel is one of the critical parts of this achievement. For instance, the Department of Energy (DOE), Department of Transportation (DOT), and U.S. Department of Agriculture (USDA) are launching a government-wide Sustainable Aviation Fuel Grand Challenge to meet the demand for sustainable aviation fuels by working with stakeholders to reduce costs, enhance sustainability, and expand production and use of sustainable aviation fuels (SAF) that achieves a minimum of a 50% reduction in life cycle GHGs compared to conventional fuel. In addition, the challenge will adopt the goal of supplying at least 3 billion gallons of SAF per year by 2030 and 2050, sufficient SAF to meet 100% of aviation fuel demand, which is currently projected to be around 35 billion gallons yearly. Therefore, with the increased environmental regulations and emissions reduction targets, the demand for sustainable aviation fuel has a foreseeable future.

Based on fuel type, the North America market is segmented into biofuel and power-to-liquid. The biofuel segment captured the most significant share, and it is anticipated that the same fashion will be followed for the forecast period. Biofuel is produced from biomass renewable resources like agricultural residues, algae, or garbage. These fuels have lower GHG emissions per energy content when combusted compared to conventional fossil fuels, hence having the potential to mitigate the negative impacts of aviation on the environment. Further, biofuels can be mixed with the traditional fossil fuel in different proportions, this enables the operators to gradually transition from fossil fuel, while at the same time experiencing little disruption due to the chain requisites of their operations. Most countries have adopted targets for limiting greenhouse gas emissions for the aviation industry, and biofuels are considered an essential solution. Moreover, the California Air Resources Board has a goal of at least 10% SAF consumption in California by 2020. These regulations offer a compelling push to call on airlines and similar organizations within the aviation industry to consider biofuel use.

Based on aircraft type, the market is bifurcated into fixed wings and rotorcrafts. The fixed wings hold a significant market share in 2023 and are expected to showcase the same trend in the forecast period due to fixed-wing aircraft being more commonly used for long-haul flights, which require more fuel and, therefore, more SAF. Furthermore, developing more efficient and environmentally friendly fixed-wing aircraft, such as the Airbus A220 and the Boeing 787 Dreamliner, is also expected to drive the demand for SAF in the fixed-wing market. The regulatory environment for SAF is also more favorable for fixed-wing aircraft. For instance, the Federal Aviation Administration (FAA) has set a goal of reducing greenhouse gas emissions from aviation to 80% below 2005 levels by 2050. Additionally, government support for increasing the production of sustainable aviation fuel from different technologies, such as algae technologies, has boosted the demand for the market in the coming years. For instance, The U.S. Department of Energy Bioenergy Technologies Office (BETO) announced USD 35 million for 11 projects developing feedstock and algae technologies for advancing the domestic economy. It announced additional selections totaling over USD 61Mn to advance biofuels and support the reduced cost of SAF pathways, including 11 projects that are scaling up promising technologies to produce SAF.

Based on platform, the North America sustainable aviation fuel market is bifurcated into commercial and military aviation. Commercial aviation holds a significant market share in 2023. It is expected to showcase the same trend in the forecast period due to the growing demand for SAF in the commercial aviation sector, the increasing awareness of the environmental impact of traditional fossil fuels, and the need for more sustainable and environmentally friendly alternatives. The International Civil Aviation Organization (ICAO) set a goal for net-zero levels to reduce greenhouse gas emissions from international aviation by 2050. To meet this goal, sustainable aviation fuel (SAF) is seen as a critical component in reducing emissions and promoting sustainable alternatives. Sustainable Aviation Fuel (SAF) is considered a more cost-effective option than conventional fossil fuels, given its capacity to lessen fuel costs while endorsing sustainability and environmental accountability. This is especially pivotal for commercial airlines, which strive to reduce expenditures and enhance profitability while upholding sustainability and environmental accountability.

For a better understanding of the market of the sustainable aviation fuel market, the market is analyzed based on its presence in region such as North America (The US, Canada, and Rest of North America). The United States market has dominated the market in 2023 and is expected to behave in the same fashion in the forecast period. The major factors propelling the demand for the market include government initiatives and collaboration to increase R&D activities to demonstrate new technology to achieve at least a 30% improvement in aircraft fuel efficiency. For instance, the National Aeronautics and Space Administration (NASA) has launched the Sustainable Flight National Partnership to collaborate with the FAA and industry to accelerate the maturation of aircraft and engine technologies that enable a step-change reduction in fuel burn and carbon dioxide emissions. Additionally, the FAA introduced the Aviation Climate Research (ACR) program in 2022, a Presidential budget request for the FAA at a proposed USD 50M. The ACR program will invest in research that has a transformative impact potential to reduce greenhouse gas emissions from aviation in support of the U.S. climate change goals. Furthermore, civil aviation has played a significant role in accelerating the adoption of sustainable aviation fuel. For instance, United Airlines announced a new goal to reduce its carbon emissions intensity by 50% compared to 2019 by 2035. United Airlines and Honeywell also announced a new multi-million-dollar investment in Alder Fuels to produce carbon-negative sustainable aviation fuel at scale. Therefore, the continuous effort to achieve net zero emissions and improvement in aircraft fuel efficiency has propelled the demand for the market and is expected to have a foreseeable future in the forecast period.

Some of the major players operating in the market include Neste, Fulcrum BioEnergy, World Energy, LLC, TotalEnergies, Gevo, Avfuel Corporation, Aemetis, Inc., Preem AB, SkyNRG, Northwest Advanced Biofuels, LLC.