Germany, Austria and Luxembourg have launched a joint funding program worth €2.12 billion ($2.3 billion) to support the production and market introduction of sustainable aviation fuel (SAF).

The three governments confirmed the initiative under a common European interest framework, according to pv magazine's The Hydrogen Stream column, which first reported the program. The funding ties into the European Union's ReFuelEU Aviation regulation, which mandates that fuel suppliers blend 2% SAF into kerosene supplied at EU airports from 2025, rising to 6% by 2030.

For airlines operating in the three countries, the program addresses the single largest barrier to SAF adoption: price. Sustainable aviation fuel currently costs between two and five times more than conventional jet fuel, depending on feedstock and production pathway. With carriers facing mandatory blending obligations, the support scheme shifts part of that cost gap onto public funding.

The €2.12 billion envelope covers both production capacity and demand-side measures. Germany accounts for the largest share of the program, reflecting the size of its aviation market — Lufthansa Group alone operates hundreds of aircraft from its Frankfurt and Munich hubs and stands among Europe's largest fuel consumers.

Austria and Luxembourg, though smaller markets, host significant operations of their own. Austrian Airlines, a Lufthansa Group subsidiary, operates from Vienna, while Luxembourg's cargo carrier Cargolux runs one of Europe's largest freighter fleets from Luxembourg Findel Airport. Both carriers face the same blending mandates as their larger competitors.

The program forms part of a wider European push to build domestic SAF production capacity. Current European output remains a fraction of what the ReFuelEU mandates will require by the end of the decade, leaving airlines dependent on imports and limited supply — factors that have kept prices elevated.

No timeline for the first funding awards or specific production volumes tied to the program was disclosed in the initial announcement. The European Commission must approve the scheme's compatibility with state aid rules before disbursement begins, a step that has sometimes taken months in comparable green-energy cases.

Whether the €2.12 billion allocation will be sufficient to close the projected supply gap by 2030 remains an open question, as analysts estimate the capital cost of meeting the EU's 6% blending target runs well into the tens of billions.