Sustainable aviation fuel market seen reaching $17.01 billion by 2035

The sustainable aviation fuel market is projected to grow from $2.25 billion in 2026 to $17.01 billion by 2035, according to MRFR, as airlines and regulators push harder on decarbonization. The report says mandates, tax credits and long-term airline contracts are turning SAF into a compliance-driven market with strong demand visibility.

Why it matters: - Sustainable aviation fuel is becoming a core decarbonization tool for aviation, a sector that contributes about 2-3% of global CO₂ emissions and has limited alternatives for long-haul flights. - The shift from voluntary climate pledges to binding procurement and blending rules gives SAF a clearer demand path through 2035. - The market's growth could reshape refinery investments, feedstock supply chains and airline fuel strategies worldwide.

What happened: - MRFR projects the sustainable aviation fuel market will rise from $2.25 billion in 2026 to $17.01 billion by 2035. - The forecast implies a 25.2% compound annual growth rate from 2026 to 2035. - The report was published Aug. 24, 2026.

The details: - Sustainable aviation fuel is a drop-in replacement for conventional jet fuel made from feedstocks such as used cooking oil, animal fats, agricultural residues and municipal solid waste. - The report says SAF can cut lifecycle greenhouse gas emissions by up to 85% versus fossil-based kerosene. - HEFA pathways account for about 62% of the market in 2025, helped by mature refining infrastructure and feedstock availability. - Fischer-Tropsch production is growing at a 31.4% CAGR through 2035. - Power-to-liquid projects drew more than $4.2 billion in announced investments from 2023 to 2025. - Used cooking oil holds a 45% share of feedstock use in 2025. - Municipal solid waste is the fastest-growing feedstock segment, with a 34.6% CAGR. - Commercial aviation is the largest end-user segment, with $1.30 billion in demand in 2025. - More than 130 airlines, representing 65% of global revenue passenger kilometers, have published net-zero by 2050 strategies that identify SAF as a primary decarbonization lever. - North America leads the market with a 38% share in 2025, and Europe follows with 34%. - Asia-Pacific is the fastest-growing region, with an estimated 29.5% CAGR. - The report says global production capacity could exceed 10 million metric tons per year by 2030 as new biorefineries and power-to-liquid facilities scale. - The market remains moderately concentrated, with the top five producers accounting for an estimated 45-50% of global output.

Between the lines: - Policy is doing the heavy lifting. The report points to the EU's ReFuelEU Aviation mandate and U.S. tax credits as the main forces turning SAF into a regulated market. - Feedstock constraints remain a major bottleneck, especially as demand for used cooking oil and other lipid-based inputs rises across multiple fuel sectors. - The economics still matter: SAF remains more expensive than conventional jet fuel, and the report says the premium is one of the biggest restraints on adoption. - Pathway diversification is emerging as the industry's hedge against feedstock scarcity, with PtL and waste-to-jet routes gaining more attention.

What's next: - The report expects production capacity gains to accelerate through 2030 as biorefineries and power-to-liquid plants reach commercial scale. - Europe will keep tightening demand through ReFuelEU Aviation, while the U.S. market continues to benefit from production tax credits and refinery conversions. - Asia-Pacific could become a bigger growth engine as Japan, India and South Korea expand national decarbonization plans. - Book-and-claim systems and digital certification platforms may widen SAF demand beyond airports with physical supply.

The bottom line: - SAF is moving from a niche climate solution to a regulated global fuel market, and the next decade looks set to be defined by policy mandates, infrastructure buildout and competition for scarce feedstocks.