Green Jet Fuel Becomes Aviation's Gold Rush

Airlines strike long-term e-fuel contracts to secure scarce supply and push aviation's low-carbon transition

3 Jun 2025

Airlines are racing to secure the fuels of the future. Carriers are striking long-term contracts for electrofuels (e-SAF), hoping to stabilise costs, hit emissions targets and secure supply before the market tightens further. Demand for sustainable aviation fuel is climbing fast, but output remains a sliver of global consumption. That makes early deals less a choice than a necessity.

The International Air Transport Association (IATA) expects production of sustainable aviation fuels to more than double in 2025, yet still meet less than 1% of global demand. Such scarcity is prompting new approaches. One is "book and claim", a certificate system that would allow airlines to record the climate benefit of e-fuels even if the fuel is burned elsewhere. These schemes are not yet fully formed, but many see them as vital for scaling climate pledges across global networks.

Executives are blunt about the stakes. At IATA's annual meeting in June, leaders stressed that long-term agreements are now essential. By locking in customers, developers gain the certainty needed to finance and build costly facilities. Without such deals, production will not expand.

Costs remain formidable. Electrofuels are far dearer than conventional jet fuel, and their viability depends heavily on government support. In Europe subsidy frameworks are being designed to spur investment, though the scale and detail remain unsettled. In America producers are pressing for similar incentives to match European momentum.

The dynamic is simple: airlines that commit early secure scarce supply, while developers with firm buyers unlock capital for new projects. Each agreement makes the next easier, gradually enlarging the market. Aviation is often cast as "hard to decarbonise". These contracts will not solve the problem alone, but they hint at a path forward, and at an industry trying, at last, to put its money where its emissions are.