Fight or Flight: Contract and Financing Considerations for UK Sustainable Aviation Fuel Projects

The piece explores the regulatory framework provided by the SAF Order 2024, which introduces sustainability criteria and a certification process for SAF production, aiming to support the development of this nascent market.

The discussion addresses challenges such as the early-stage nature of SAF technologies, pricing uncertainties, and the need for long-term offtake agreements to meet lender requirements. Additionally, the authors highlight the impact of government initiatives, such as the Advanced Fuel Fund and a proposed revenue certainty mechanism, in enhancing the financial viability of SAF projects. These measures, combined with the growing demand for SAF as a drop-in fuel, position the UK to emerge as a leader in the global SAF sector despite inherent risks and complexities.

Read the full Environmental Finance article here.

* Anuja Venkataramani is a trainee solicitor in the London office.