Myth-busting Sustainable aviation & shipping: separating hype from reality

Global sustainable aviation fuel (SAF) production reached just 1 million tonnes in 2024—representing merely 0.3% of total jet fuel consumption—while shipping emissions have increased 20% over the past decade despite representing 3% of global greenhouse gas output (IATA, 2024; IMO, 2024). If shipping were a country, it would rank as the sixth-largest emitter globally. For European stakeholders navigating corporate Scope 3 reporting requirements and transition planning, these sectors represent both urgent decarbonisation challenges and persistent sources of greenwashing claims. This article separates achievable progress from aspirational marketing.

Why It Matters

The regulatory landscape for transport emissions has fundamentally changed in Europe. The EU Emissions Trading System (ETS) expanded to include maritime shipping from 2024, creating direct carbon pricing for vessel operators. FuelEU Maritime, effective 2025, establishes a greenhouse gas intensity standard that will tighten progressively through 2050. ReFuelEU Aviation mandates SAF blending at EU airports, starting at 2% in 2025 and rising to 70% by 2050. These regulations transform aviation and shipping emissions from voluntary disclosure items to compliance obligations with financial consequences.

For companies with significant Scope 3 transportation emissions—essentially any manufacturer, retailer, or distributor—these developments have immediate implications. Corporate climate disclosures under CSRD must address value chain emissions, making transportation decarbonisation strategies material disclosure items. Investors increasingly question companies lacking credible plans to address Scope 3 transport emissions, particularly when aviation and shipping represent easily identifiable improvement opportunities.

However, the gap between commitments and capability remains substantial. SAF production is projected to reach only 1.9-2.1 million tonnes in 2025—roughly 0.7% of global jet fuel demand (SkyNRG Market Outlook, 2025). Airlines face SAF premiums of 2-5 times conventional jet fuel prices, with compliance costs for European carriers potentially reaching €29 billion by 2032 if production targets are missed. The shipping industry's convergence on methanol and LNG as transitional fuels offers incremental benefits but falls short of the transformation required for Paris-aligned trajectories.

Key Concepts

Sustainable Aviation Fuel Pathways

SAF encompasses multiple production technologies with varying scalability and sustainability profiles. HEFA (hydroprocessed esters and fatty acids) dominates current production at 80-85% of capacity, converting waste cooking oils and animal fats into jet fuel. Feedstock limitations constrain HEFA scaling—global waste oil supply cannot meet projected SAF demand. Alcohol-to-Jet (AtJ) pathways, representing about 8% of announced capacity, convert ethanol or other alcohols to jet fuel. Power-to-liquid or e-SAF pathways use renewable electricity and captured CO₂ to synthesise fuel but remain prohibitively expensive at approximately 12 times conventional jet fuel costs.

Shipping Fuel Transition Options

Shipping decarbonisation options include LNG (liquefied natural gas), methanol, ammonia, hydrogen, and battery-electric propulsion. LNG represents the most mature option with approximately 820 vessels ordered in 2024, offering significant sulphur and particulate reductions but limited climate benefit due to methane slip during combustion. Methanol is gaining traction with 450+ capable vessels on order or in water by late 2025, offering simpler retrofit pathways and growing green methanol production. Ammonia offers zero-carbon combustion but faces safety, infrastructure, and energy density challenges. Battery-electric propulsion works for short-sea routes but cannot scale to transoceanic shipping.

Scope 3 Transportation Emissions Accounting

Transport emissions typically fall into Scope 3 Category 4 (upstream transportation and distribution) and Category 9 (downstream transportation and distribution). Companies purchasing transport services must allocate emissions based on cargo weight, distance, and carrier emissions intensity. The Well-to-Wake methodology for shipping and Tank-to-Wake for aviation establish calculation boundaries, though full lifecycle accounting remains complex. Corporate purchasers increasingly request carrier-specific emissions data rather than relying on industry averages.

Sector-Specific KPI Table

KPI	Current EU Benchmark	2030 Target	Implementation Challenge
SAF blend rate (aviation)	0.6% (2024)	6% (2030 mandate)	Production capacity constraints
SAF price premium	2-5x conventional	<2x for viability	Scale and feedstock economics
Shipping GHG intensity	Baseline	40% reduction vs. 2008	Fleet turnover time (20-30 years)
Alternative fuel vessel orders	~30% of new builds	Majority by 2028	Fuel availability uncertainty
Green methanol availability	Limited	Growing rapidly	Production facility buildout
EU ETS shipping compliance	First year (2024)	Full coverage	MRV system implementation

What's Working and What Isn't

What's Working

EU mandates are creating guaranteed demand for SAF. ReFuelEU Aviation's mandatory blending requirements provide production certainty that enables investment in SAF manufacturing capacity. Airlines cannot evade requirements by tankering fuel from non-EU airports—the regulation applies to departing flights regardless of fuel origin. This regulatory architecture addresses the chicken-and-egg dynamic that previously constrained investment: producers now have guaranteed offtake, reducing project risk.

Shipping is converging on practical fuel pathways. After years of uncertainty about which alternative fuels would prevail, the industry is increasingly aligning around methanol for near-term deployment and LNG for existing vessel modifications. This convergence enables bunkering infrastructure investment and reduces technology risk for shipowners. The Global Maritime Forum reports that methanol-ready newbuilds have become standard for many vessel categories, building optionality even where green methanol is not yet available.

Energy efficiency improvements are delivering near-term gains. Operational measures including slow steaming, route optimisation, and hull coatings can reduce shipping emissions by 20-30% with minimal capital investment. Wind-assisted propulsion systems are moving from pilots to commercial deployment, with rigid sails demonstrating significant fuel savings. These measures buy time while zero-emission fuel supply scales up.

What Isn't Working

SAF production growth has slowed below projections. IATA reports that 2024 SAF volumes fell short of the 1.5 million tonne estimates due to US facility delays. The disconnect between announced capacity and actual production reflects feedstock competition, financing challenges, and permitting delays. Airlines making SAF purchase commitments cannot always secure supply at projected prices and volumes, creating uncertainty for transition planning.

Feedstock limitations constrain bio-based pathways. EU SAF feedstock mix in 2024 was 81% used cooking oil and 17% waste animal fats—essentially zero synthetic fuel production. With 69% of feedstock imported (38% from China, 12% from Malaysia), Europe faces supply chain vulnerabilities and certification challenges. Waste oil and fat supplies cannot scale to meet projected demand, making e-SAF development essential but currently uneconomic.

Ship fleet turnover creates lock-in risk. Vessels have 20-30 year operational lives, meaning ships ordered today will operate through 2050+. Orders for conventional or LNG vessels lock in emissions profiles that may prove incompatible with tightening regulations. However, the uncertainty about which zero-emission fuels will achieve scalability makes vessel specification decisions genuinely difficult rather than merely resistant to change.

Key Players

Established Leaders

Neste is the world's largest SAF producer, operating renewable fuel refineries in Finland, Singapore, and Rotterdam with plans for expansion. Their HEFA production provides near-term supply while developing next-generation pathways.

Maersk is leading shipping decarbonisation, ordering 19 methanol-capable vessels and investing in green methanol production. Their 2040 net-zero target is backed by specific vessel ordering and fuel procurement strategies.

Lufthansa Group has committed to significant SAF procurement and invested in e-SAF production through partnerships with companies including Synhelion. Their systematic approach to corporate SAF purchasing creates demand certainty for producers.

SkyNRG specialises in SAF supply chain development, connecting airlines with producers and developing dedicated supply facilities. Their SAF Market Outlook reports provide authoritative industry analysis.

Emerging Startups

Synhelion develops solar thermochemical processes to produce e-SAF from sunlight, water, and captured CO₂. Their technology addresses the feedstock constraints limiting bio-based SAF scaling.

Infinium produces e-fuels for aviation and shipping using renewable electricity and captured CO₂, with commercial-scale facilities under development.

Nautilus Labs provides AI-powered vessel performance optimisation, helping shipowners reduce fuel consumption through operational efficiency gains.

Key Investors and Funders

Breakthrough Energy Ventures invests in sustainable fuel technologies including multiple SAF producers, providing growth capital for scaling production.

European Investment Bank provides financing for sustainable transport infrastructure including SAF production facilities and alternative fuel bunkering.

Amazon Climate Pledge Fund has invested in SAF producers and sustainable logistics, aligning investment with Amazon's own transportation decarbonisation commitments.

Examples

Air France-KLM SAF Procurement Strategy: Air France-KLM has signed multiple long-term SAF offtake agreements totalling hundreds of thousands of tonnes, providing producers with demand certainty. Their approach includes corporate partnership programmes where business customers can purchase SAF contributions to offset travel emissions. The airline's transparent reporting on SAF blend rates enables corporate customers to incorporate actual (rather than projected) SAF usage into Scope 3 calculations. For companies selecting carriers based on sustainability credentials, Air France-KLM's approach provides verifiable data supporting procurement decisions.
Maersk ECO Delivery: Maersk offers carbon-neutral shipping through their ECO Delivery programme, using green fuels and verified carbon offsets. The programme enables corporate shippers to select lower-emission transport options at premium pricing. By 2024, major brands including H&M, Electrolux, and Volvo Cars had enrolled, demonstrating demand for decarbonised shipping despite cost premiums. For companies developing Scope 3 transition plans, Maersk ECO Delivery provides a mechanism to demonstrate procurement-based emissions reduction even before zero-emission shipping achieves scale.
Copenhagen Airports Renewable Fuel Commitment: Copenhagen Airports has committed to 30% SAF usage for fuel supplied at its airports by 2030, exceeding ReFuelEU Aviation requirements. The airport authority is investing in SAF supply infrastructure and working with airlines and fuel suppliers to ensure physical supply. This airport-led approach demonstrates how infrastructure operators can accelerate SAF adoption beyond regulatory minimums. For companies headquartered near progressive airports, location-based Scope 3 improvements may become available earlier than industry-wide transitions would suggest.

Action Checklist

Calculate Scope 3 Category 4 and 9 emissions with carrier-specific data where available
Evaluate carrier sustainability programmes (Maersk ECO Delivery, airline SAF options) against price premiums
Incorporate transport decarbonisation into supplier requirements for logistics partners
Develop transition plan addressing aviation and shipping emissions with realistic timelines
Monitor ReFuelEU Aviation and FuelEU Maritime implementation for compliance implications
Explore industry collaboration opportunities to aggregate SAF demand

FAQ

Q: How should companies account for SAF in Scope 3 reporting? A: Under GHG Protocol guidance, SAF reduces well-to-wake emissions proportional to the lifecycle carbon intensity of the specific fuel pathway. Companies using market-based accounting should obtain documentation confirming physical SAF delivery and chain of custody. Book-and-claim mechanisms (purchasing SAF certificates without physical delivery) remain contentious, with some frameworks accepting them while others require physical supply correlation. Conservative accounting uses actual SAF blend rates reported by carriers.

Q: What's the realistic timeline for meaningful SAF availability? A: EU mandates provide regulatory visibility: 2% blend by 2025, 6% by 2030, 70% by 2050. However, actual supply may fall short of mandates in early years, triggering compliance mechanisms or penalty payments. Companies should plan for 5-10% SAF availability by 2030 for EU-departing flights, with higher blend rates available at premium pricing for companies willing to pay. Global SAF availability outside regulated markets will lag EU timelines.

Q: Should companies prioritise aviation or shipping decarbonisation in Scope 3 strategies? A: Prioritise based on materiality—whichever sector represents larger emissions in your value chain. Shipping generally offers more near-term options (carrier selection, modal shift, operational efficiency) at lower cost premiums than aviation SAF. However, aviation emissions are more visible to stakeholders and employees, creating reputational considerations beyond pure carbon accounting. Most companies should address both sectors but may sequence investments based on option availability.

Q: How should retrofit investments be evaluated against fleet replacement? A: Retrofits (wind-assisted propulsion, engine tuning, hull coatings) offer 5-20% emissions reductions at modest capital cost with short payback periods. Fleet replacement to alternative fuel vessels offers larger reductions but requires substantial capex and faces fuel availability uncertainty. For shipping, retrofits represent pragmatic near-term action while alternative fuel infrastructure develops. Aviation retrofits are more limited—SAF is the primary pathway for existing aircraft.

Sources

International Air Transport Association (IATA). "SAF Production Growth Rate is Slowing Down." December 2024.
International Maritime Organization (IMO). "Fourth IMO GHG Study 2024." 2024.
SkyNRG & ICF. "Sustainable Aviation Fuel Market Outlook 2025." February 2025.
European Aviation Safety Agency (EASA). "Report on Sustainable Aviation Fuel Scale-up." 2024.
Global Maritime Forum. "Why 2025 is such an important year for shipping decarbonisation." January 2025.
DNV. "Maritime Forecast to 2050." 2024.
U.S. Energy Information Administration. "U.S. sustainable aviation fuel production takes off." March 2025.