The UK government has announced a significant new investment package aimed at accelerating the development of sustainable aviation fuel (SAF) production across the country, with industry leaders welcoming the move as a major step towards decarbonising aviation and supporting economic growth.
A new £219 million Low Carbon Fuels Fund (LCFF), due to launch later this summer, is intended to help scale up domestic production of low-carbon fuels and strengthen the UK’s position in the emerging global SAF market. As part of the initiative, £93 million will be made available over the next two years for companies developing low-carbon fuel projects, with funding expected to prioritise schemes that are closest to commercial production. Applications are set to open in mid-July.
The latest funding programme follows previous government support through the Advanced Fuels Fund, which has invested £198 million since 2022 in cleaner aviation technologies. The government believes the growth of a UK-based sustainable aviation fuel sector could contribute as much as £5 billion to the economy by 2050 while creating thousands of skilled jobs nationwide.
“This £219 million is the next chapter in Britain’s green aviation revolution. We’re backing brilliant British innovation, creating thousands of high-skilled jobs and making sure the UK leads the world in the fuels that will power the future of flight.
This kind of investment is exactly how we kickstart economic growth, open up exciting new opportunities for young people and make our holidays greener and cleaner.”
– Keir Mather, UK Minister of Aviation, Maritime and Decarbonisation.
Sustainable aviation fuel is widely regarded as one of the key technologies available to reduce emissions from air travel. Produced from sustainable feedstocks rather than fossil fuels, SAF can reduce greenhouse gas emissions by around 70% on a lifecycle basis. The government sees the development of domestic production capacity as an important part of enabling aviation growth while remaining on track to meet net-zero commitments.
Alongside the funding announcement, the government has launched a Call for Evidence examining the operation of the UK’s Sustainable Aviation Fuel Mandate. The mandate requires an increasing proportion of jet fuel supplied in the UK to come from sustainable sources, beginning at 2% in 2025 and rising to 10% by 2030 and 22% by 2040. The review will consider future global supply forecasts for different sustainable fuel pathways and how these may affect delivery of the mandate in the years ahead.
Officials have indicated that the exercise forms part of ongoing engagement with industry and is intended to ensure the framework remains effective as the market develops. The government has stressed that it is not considering reducing the overall mandate targets and is instead focused on ensuring the policy remains fit for the future.
“We are very pleased to see the launch of the DfT’s low carbon fuels fund and the clear commitment to further development of homegrown sustainable aviation fuel in the UK. At British Sugar, following a grant from the advanced fuels fund, the British BioJet project at our Wissington site is exploring the development of a sizeable demonstration plant.
It will utilise our existing waste feedstocks with ethanol-to-jet technology to produce 1,500 tonnes of SAF – supporting the growth in cleaner, greener jobs and investment. We welcome this next phase of funding to develop SAF and look forward to making an application so that we can continue supporting the government’s ambition for net-zero aviation.”
– Keith Packer, Managing Director of British Sugar.
The investment has also been welcomed by companies already developing large-scale SAF facilities in the UK.
“Today’s investment by the UK government strengthens the UK’s position as a global leader in sustainable aviation fuel production. It will help companies like LanzaTech turn waste into green jet fuel, creating skilled jobs and economic growth, for example, in Humberside, where we are developing a new SAF facility capable of supplying around 1% of the UK’s jet fuel demand.
The call for evidence on future SAF targets is also an important step towards giving industry the long-term certainty needed to scale production and accelerate private investment today and beyond 2030.”
– Jennifer Holmgren, Chief Executive of LanzaTech.
The government hopes that continued investment in low-carbon fuels will encourage further private sector backing for new production facilities, helping to establish a thriving domestic SAF industry while supporting employment opportunities across engineering, manufacturing, construction and scientific research.
As investment continues to shape the future of aviation, our MTB Aviation events provide the opportunity to meet and engage with the companies leading the industry’s next phase of growth. Contact us today to find out more.
