The Transatlantic SAF Boom: What Europe’s Mandates Mean for US Producers
Co-written with Alan Sutherland, Senior Vice President of Americas at Brightsmith, specialising in e-fuels and SAF.
In the race to decarbonise aviation, two regions are taking very different approaches but increasingly relying on one another. Europe is driving demand through binding mandates, while the United States is creating cost advantages through subsidies. The result could be a new transatlantic flow of sustainable aviation fuels (SAF) and e-fuels.
Europe: binding demand through ReFuelEU
The European Union has set out its clearest aviation decarbonisation roadmap through the ReFuelEU Aviation regulation. From 2025, airlines refuelling at EU airports must blend in 2% SAF, with the share rising to 6% by 2030 and ultimately 70% by 2050. Within this, a specific synthetic e-fuel (renewable fuels of non-biological origin, or RFNBO) sub-mandate is included: 1.2% by 2030 and 35% by 2050.
This regulatory framework aims to create guaranteed offtake for SAF producers and send a clear demand signal to investors. Yet airlines and fuel suppliers have warned that meeting the near-term targets will be challenging given limited supply and high production costs, underlining the need for external supply sources as early as the next decade.
United States: cost advantage through incentives
On the other side of the Atlantic, the United States has not imposed binding SAF usage mandates but is instead catalysing production through incentives. The SAF blender’s tax credit (§40B) provides up to $1.75 per gallon through 2024, after which a technology-neutral credit (§45Z) takes effect in 2025. In parallel, the clean hydrogen credit (§45V) offers up to $3/kg for low-carbon hydrogen, a critical input for power-to-liquid e-kerosene.
These layered credits substantially lower the cost of producing SAF and e-fuels in the US. According to the Department of Energy’s SAF Grand Challenge roadmap, the US aims to produce 3 billion gallons annually by 2030 and 35 billion gallons by 2050. Analysts point out that stacking credits across hydrogen and finished fuels makes the US one of the most competitive jurisdictions globally for project bankability.
The export question: will US fuels flow to Europe?
With Europe’s demand obligations outpacing domestic production, the question is whether US-made fuels will be exported to the EU to bridge the gap. Some trade is likely, especially for e-kerosene and other SAF volumes that meet European sustainability criteria. But eligibility is not universal.
A large portion of announced US SAF capacity is based on food- and feed-based oils that do not qualify under EU rules. Only fuels derived from waste oils, advanced feedstocks or synthetic pathways would count toward European mandates. This means while the US could become a key external supplier, not all of its low-cost capacity will be export-ready for the EU.
Market implications
The dynamic is clear: Europe is creating demand through regulation, while the US is generating supply through incentives. Some transatlantic trade will emerge, particularly as mandates tighten from 2030 onwards, but volumes will be shaped by feedstock eligibility and by how much subsidised US product is absorbed domestically.
For airlines and offtakers in Europe, the priority will be to secure long-dated supply agreements and ensure compliance with EU sustainability criteria. For US producers, combining §45V hydrogen incentives with §45Z fuel credits could materially improve project economics and attract investors. And for policymakers, both sides of the Atlantic will need to watch how trade, eligibility and subsidy structures interact, shaping whether SAF remains a domestic or a global commodity.
Bottom line
The transatlantic SAF market is entering a critical phase. Europe’s mandates guarantee rising demand, while the US is rapidly scaling cost-advantaged supply. The intersection of the two could define not only the trajectory of e-fuels but also the competitiveness of aviation decarbonisation on both continents.
Alan Sutherland is a Senior VP of Americas at Brightsmith, specialising in e-fuels and SAF. With a deep knowledge of the global clean energy landscape, Alan partners with industry leaders and innovators to build high-impact teams driving the future of low-carbon aviation. His work spans regulatory developments, project finance, and emerging technology trends, giving him a front-row view of the rapid growth shaping the e-fuels sector.
