The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024 (the Order) came into force on 1 January. Based on the premise that sustainable aviation fuel (SAF) has the potential to materially reduce the greenhouse gas impacts of aviation, the Order creates a mandate for sustainable aviation fuel in the UK and is anticipated to deliver a reduction in greenhouse gas emissions of between 11 and 54 MtCO2e between 2025 and 2040[1].

In this article we consider the impacts of the Order, the new obligations for aviation fuel suppliers, the penalties suppliers may now be subject to and how it is anticipated SAF requirements may evolve.

What is "sustainable aviation fuel"?

The Order creates a statutory definition of SAF, referring to aviation gasoline, aviation turbine fuel[2] or hydrogen. The associated guidance identifies four categories of SAF based on feedstock[3]:

Renewable sources

A. Wastes and feedstocks of biological origin (from a production process or derived directly from agriculture, aquaculture, fisheries or forestry).

B. Renewable hydrogen, or Power to Liquid (PtL) fuels produced from sources other than biomass.

Low carbon feedstocks

C. Non-renewable fossil wastes that comply with the requirements for recycled carbon fuel (RCF) as designated by the Secretary of State.

D. PtL or low-carbon hydrogen produced using nuclear energy.

The guidance clarifies: SAF made from feedstocks that falls under category "A" is considered biofuel; fuel made from feedstocks falling within "B" and "D" with a final fuel type of avtur is PtL; and SAF cannot be produced from food, feed or energy crops[4].

What is the SAF obligation?

The SAF obligation is broadly equivalent to the renewable transport fuel obligation that was brought in under the Energy Act 2004 (the 2004 Act)[5]. Under the Order, any supplier who in a calendar year supplies aviation fuel with a total energy content of 15.9 terajoules or higher at, or for delivery to, places in the United Kingdom (defined by the Order as "obligated suppliers") will be subject to the obligations set out in article 3 of the Order.[6]

Note: the mandate does not apply to the first 15.9 terajoules of fuel if the amount they supply in the relevant year is less than 344 terajoules[7].

The Renewable Transport Fuel Obligations Order 2007 (RTFO), which requires suppliers of transport fuel (including petrol, diesel, gas, oil and renewable fuels) to ensure that low carbon and renewable fuels make up a certain percentage of the fuel they supply, no longer applies to aviation fuel.[8] Like the RTFO, the Order states fuels must meet a particular emissions saving threshold to be eligible for the award of certificates. However, the minimum threshold for greenhouse gas emissions savings under the RTFO is dependent upon when the production installations were built and the type of feedstock involved, whereas the Order requires a minimum 40% reduction in greenhouse gas emissions for all feedstock and fuel types[9]. Starting in 2025, a proportion of the total energy content must be SAF . This rate starts in 2025 at 2.041% and increases year-by-year, as demonstrated in the table below.

Obligation period  % of energy supplied required to be SAF
 1st January 2025 to 31st December 2025  2.041%
 1st January 2026 to 31st December 2026 3.734%
 1st January 2027 to 31st December 2027 5.485%
 1st January 2028 to 31st December 2028 7.082%
 1st January 2029 to 31st December 2029 8.952%
 1st January 2030 to 31st December 2030 10.556%
 1st January 2031 to 31st December 2031 11.485%
 1st January 2032 to 31st December 2032 12.465%
 1st January 2033 to 31st December 2033 13.467%
 1st January 2034 to 31st December 2034  14.493%
 1st January 2035 to 31st December 2035  15.882%
 1st January 2036 to 31st December 2036  17.344%
 1st January 2037 to 31st December 2037 18.856%
 1st January 2038 to 31st December 2038 20.421%
 1st January 2039 to 31st December 2039 22.040%
 1st January 2040 to 31st December 2040 and subsequent obligation periods 23.718%

The amount of SAF that can be derived from hydro-processed esters and fatty acids (HEFA) for the purposes of meeting the main obligation will be capped from 1 January 2027 as below[10].

Obligation period % of SAF that can be derived from HEFA for the purposes of producing SAF certificates
1st January 2025 to 31st December 2025 100.00%
1st January 2026 to 31st December 2026 100.00%
1st January 2027 to 31st December 2027 92.31%
1st January 2028 to 31st December 2028 87.88%
1st January 2029 to 31st December 2029 80.49%
1st January 2030 to 31st December 2030 74.74%
1st January 2031 to 31st December 2031 73.17%
1st January 2032 to 31st December 2032 69.09%
1st January 2033 to 31st December 2033 65.53%
1st January 2034 to 31st December 2034 61.60%
1st January 2035 to 31st December 2035 57.78%
1st January 2036 to 31st December 2036 53.79%
1st January 2037 to 31st December 2037 50.32%
1st January 2038 to 31st December 2038 47.27%
1st January 2039 to 31st December 2039 44.57%
1st January 2040 to 31st December 2040 and subsequent obligation periods 42.16%

Obligated suppliers will also be under an obligation to fulfil a certain % of the total energy content they supply by utilising PtL.

Suppliers' PtL obligation starts in 2028 at 0.215%, increasing year-by-year to 4.487% in 2040 as below.

Obligation period Percentage of amount of PtL required to be used
1st January 2025 to 31st December 2025 0.000%
1st January 2026 to 31st December 2026 0.000%
1st January 2027 to 31st December 2027 0.000%
1st January 2028 to 31st December 2028 0.215%
1st January 2029 to 31st December 2029 0.218%
1st January 2030 to 31st December 2030 0.556%
1st January 2031 to 31st December 2031 0.560%
1st January 2032 to 31st December 2032 0.850%
1st January 2033 to 31st December 2033 1.146%
1st January 2034 to 31st December 2034 1.449%
1st January 2035 to 31st December 2035 1.765%
1st January 2036 to 31st December 2036 2.273%
1st January 2037 to 31st December 2037 2.798%
1st January 2038 to 31st December 2038 3.342%
1st January 2039 to 31st December 2039 3.904%
1st January 2040 to 31st December 2040 and subsequent obligation periods 4.487%

What steps do obligated suppliers need to take?

Obligated suppliers must apply to the Department for Transport (DfT) within 28 days of becoming an obligated supplier for an account which will record the balance of SAF certificates held.

SAF certificates are issued by the DfT to suppliers in respect of each unit of applicable SAF[11].

Obligated suppliers will be required to provide the DfT with information such as: how much relevant aviation fuel and/or SAF they have supplied during a calendar year; the amount of each they have received from other suppliers and details as to the mass supplied, energy content, portion attributable to each feedstock type; and the amount that meets the sustainability criteria.

Note: SAF is no longer eligible for certificates under the RTFO.

SAF certificates can be transferred between any persons who are account holders, provided that:

  1. the transfer is to one transferee only;
  2. the transferor notifies the DfT on or within one month before the date of the transfer of the name and account number of the transferee, the date of the transfer and the obligation period for which the certificate was issued;
  3. the SAF certificate is held to the credit of the transferor's account at the date and time of the transfer; and
  4. the DfT does not consider there to be any reason for the SAF certificate to be revoked under article 20 of the Order.

Any SAF certificates may count towards the discharge of no more than 25% of a supplier's main obligation in the next calendar year[12] / no more than 25% of a supplier's PtL obligation in the next calendar year[13].

Payments

The Order also provides for obligated suppliers to pay a "buy-out amount" for any calendar year where they do not meet the SAF obligation / PtL obligation[14]. The Order identifies an amount of £0.145 per megajoule for any shortfall against the PtL obligation, and £0.137 per megajoule for any shortfall against the SAF obligation.

What are the consequences of non-compliance?

The order provides for civil penalties of up to:

  • £100,000;
  • 10% of the turnover of the obligated supplier; or
  • in the case of an obligated supplier who has gained or attempted to gain one or more SAF certificates by contravening certain provisions of the Order, an amount equivalent to twice the value of the SAF certificates which they have gained or attempted to gain[15].

Suppliers are liable for civil penalties if they contravene[16]:

  1. article 6(2) of the Order by failing to apply to the DfT for an account within 28 days of becoming an obligated supplier; or
  2. article 21(8) of the Order by failing to pay the buy-out amount; and
  3. suppliers or other persons are also liable for civil penalties where they provide inaccurate information or evidence in support of applications for SAF Certificates.

What are the anticipated impacts on airline operators?

Concerns have been expressed that there will be a limited supply of SAF in the early period following the Order's introduction [17]. The Order seeks to mitigate such concerns through methods such as the buy-out mechanism discussed above, which allows obligated suppliers to pay a buy-out amount to the Government if they are not able to meet their SAF obligations under the Order.

How has the Government supported the market?

The Advanced Fuels Fund (AFF) was launched in July 2022 by the DfT for the purposes of allocating £135 million of investment into the UK's advanced fuels sector. The AFF is seeking to support the progression of a range of routes to advanced fuels (including SAF), boost innovate technologies for fuel production and strengthen the UK's project pipeline.

How are the current obligations likely to evolve?

A full official review of the regulatory provisions contained within the Order must be carried out at least once every five years, meaning a review is due to take place before 1 January 2030[18].

Revenue certainty

The Government has also indicated its intention to introduce a Revenue Certainty Mechanism in 2026, which would aim to reduce the risks for producers of SAF, thereby encouraging investment into SAF production in the UK[19]. The Government has shortlisted the following mechanism options: (i) mandated floor prices; (ii) mandated auto rachet; (iii) buyer of last resort; and (iv) guaranteed strike price.

The mandated floor price mechanism introduces a universal minimum price for SAF certificates, while the mandated auto rachet automatically adjusts the price of SAF when there is an oversupply in the market to bring this near to the buy-out price. Both mechanisms would maintain a high price for SAF, which would almost certainly be passed on to passengers via higher airfares.

Where a buyer of last report mechanism is utilised, if the price of SAF certificates on the open market falls below an agreed amount, the Government purchases SAF certificates. This maintains the price of the SAF certificates so that this does not fall below this pre-agreed figure, reducing the risk to SAF producers by ensuring their operating costs are covered by the return on the sale of the SAF.

Under a guaranteed strike price scheme, SAF producers are guaranteed a price for SAF on a per litre basis (known as the strike price), as the Government covers the difference where the market price falls below the strike price. However, this also works to require the SAF producer to pay back the difference if the strike price is lower than the market price.

The Government has not yet established which of these mechanisms would be most effective for the SAF market but has stated that it intends for the industry to cover the costs of any revenue uncertainty mechanism that is required[20].

Mitigation of 'tankering'

As part of the consultation for the Order, consideration was given to whether any mitigation measures should be included within the Order to avoid airline operators tankering (where enough fuel is taken on in markets where lower-cost fuels are available ahead of inbound trips to the UK to cover the outbound trip) to minimise the impact of the Order on their operations[21]. The Government considered introduction of a minimum uplift when departing UK airports, which the European Union (EU) has introduced to reduce tankering and minimise avoidance of sustainable fuel obligations. At present it has been decided that no such mitigation measures are to be introduced in the UK, but the Government intends to conduct further research and assess the potential for introducing mitigation mechanisms, meaning such measures may be imposed in the future[22].

What are the key dates under the Order?

Key dates (in each year) Event 
 01 January  Each specified period begins.
 01 January  Each obligation period for the buy-out amount begins.
 12 May  Deadline for suppliers to make an application for a SAF certificate for the previous obligation period, per article 16.
 16 July Each revocation date for the previous obligation period, for the purposes of article 20 (Revocation of a SAF certificate).
 23 July Each applicable date for the previous obligation period, for the purposes of article 20 (Revocation of a SAF certificate).
 6 August Each notification date for the previous obligation period for the purposes of article 20 (Revocation of a SAF certificate).
 15 August Each reconsideration date for the previous obligation period for the purposes of article 20 (Revocation of a SAF certificate).
 16 August The applicable date for the previous obligation period for the purposes of article 24 (Civil Penalties).
 15 September The specified date, being the date by which a supplier must provide the Administrator with the information required under article 11, for the previous specified period.
 26 October Each obligation period for the buy-out amount ends.
 31 December Each specified period ends.

If you have any queries regarding The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024 or require support to navigate its impacts on your business, please reach out to Dominic Richardson or Elizabeth Williams.

If you should have any queries about this article, please contact Annabelle Percy.

Footnotes:

[1] Explanatory Memorandum to The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024 (2024 No. 1187), paragraph 5.4.
[2] The Order includes definitions of aviation gasoline referring to ASTM International standard D910, Ministry of Defence standard 91–90 (or other equivalent standard) and Aviation turbine fuel as heavy oil (as defined in the Hydrocarbon Oil Duties Act 1979), of which more than 50% by volume distils at 240°C, which meets ASTM International standard D1655, the Ministry of Defence standard 91-91, or another equivalent standard.
[3] RTFO and SAF Mandate technical guidance 2025.
[4] RTFO and SAF Mandate technical guidance 2025pages 11, 13-20.
[5] Energy Act 2004, section 124.
[6] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, article 3.
[7] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024 article 3. (6)(b) and The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024 page 7.
[8] https://assets.publishing.service.gov.uk/media/67626fe2f666d2e4faef3a0e/rtfo-compliance-guidance-2025.pdf page 6.
[9] https://assets.publishing.service.gov.uk/media/67626f161ca3ec0a49e1908e/rtfo-and-saf-mandate-technical-guidance-2025.pdf page 53.
[10] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, article 22.
[11] Units of applicable SAF are determined by dividing the notional amount of that fuel by the lower heating value of aviation turbine fuel.
[12] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, article 23(1).
[13] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, article 23(2).
[14] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, article 21(9).
[15] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, article 24(7), which references breaches of articles 6(2), (7), 7(3), 11(6), 12(5), 16(5), 20(14) or 21(8) of the Order.
[16] The Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, article 24.
[17] Flight Global | Emirates’ Clark warns that SAF mandates have gone too far
[18] [19] Department for Transport | Supporting the transition to Jet Zero: Creating the UK SAF Mandate.
[20] Department for Transport | Delivery plan for designing and implementing a revenue certainty mechanism for SAF
[21] Department for Transport | Pathway to net zero aviation: Developing the UK sustainable aviation fuel mandate, page 14.
[22] Department for Transport | Supporting the transition to Jet Zero: Creating the UK SAF Mandate, page 129.