Germany is preparing a €2-billion programme to develop and scale synthetic sustainable aviation fuel (eSAF), targeting the single biggest obstacle between the technology and airline fuel tanks: cost.

The price gap the scheme must attack is stark. EASA's 2025 reference prices put synthetic aviation fuel at roughly €7,520 per tonne on average, against around €640 per tonne for conventional jet fuel. That is a multiple of nearly 12.

Why is Germany stepping in now?

Electric aircraft are advancing, particularly on short regional routes, but batteries are unlikely to replace liquid fuels across the sector. Long-haul flying demands high energy density at low weight, leaving SAF as the principal route to lower aviation emissions.

The German scheme deliberately does not assume eSAF is already competitive. Instead, it is structured to make producers compete in closing the cost gap.

How big is Europe's project pipeline?

Transport & Environment has identified 41 large-scale European eSAF projects with a combined potential annual capacity of nearly 3 million tonnes. The record beyond announcements is thin.

• Only four projects are considered advanced
• None has reached a final investment decision (FID)
• Individual plants require €1 billion to €2 billion of investment each

That capital intensity means long-term offtake commitments — often running about a decade — are a precondition for project financing.

What blocks the market from forming?

The production path is well understood. Renewable electricity generates hydrogen via electrolysis; the hydrogen is combined with sustainable carbon dioxide and converted into synthetic hydrocarbons. The resulting fuel is drop-in: it works in existing aircraft and flows through current storage and airport infrastructure.

The commercial structure, not the chemistry, is the constraint. Airlines and fuel distributors hesitate to lock in ten-year purchases at prices 12 times kerosene when production costs, regulation and competing fuel technologies may all shift within that window.

The result is a circular impasse. Producers must build large plants to bring unit costs down, but financing those plants depends on buyers committing before the technology gets cheaper.

Germany's €2-billion programme aims to break that cycle by backing the emergence of a market in which eSAF producers compete on cost reduction. Whether it converts any of Europe's 41 announced projects into a signed FID will be the measure of its success.