Sustainable aviation fuel sits at an inflection point that, on paper, should already have passed. The economics, the policy scaffolding and the airline demand signals all point in one direction — toward adoption. Yet the market itself continues to hedge, and that hesitation, more than any technical barrier, now defines the pace of decarbonisation in commercial aviation.

Corporate Knights, in a recent analysis, frames the current moment as one where conditions appear ripe for SAF — but where the market's willingness to commit has not caught up with the opportunity. The gap between readiness and execution is the story.

Why the moment looks ripe

Three forces have converged. First, airlines face mounting pressure to cut lifecycle emissions, and SAF remains the only near-term lever that works across existing fleets. Airframe and engine manufacturers have designed current-generation aircraft to burn blended SAF today; no fleet replacement is required. Second, governments on both sides of the Atlantic have constructed incentive and mandate regimes intended to pull supply into the market. Third, corporate travel buyers and freight customers increasingly tie purchasing decisions to verified emissions performance, pushing carriers toward fuel choices they can defend in sustainability reporting.

Each force independently argues for aggressive SAF procurement. Together they suggest the commercial case should already be closed.

Why the market still hesitates

The hedging, as Corporate Knights identifies it, stems from the structure of the fuel itself. SAF today costs more than conventional jet fuel, and the price premium lands on balance sheets that cannot easily absorb it. Airlines operate on thin margins and compete on fares; a carrier that unilaterally absorbs a fuel premium hands a cost advantage to rivals who wait.

Producers face the mirror image of that problem. Building refining capacity requires capital commitments measured in hundreds of millions of dollars, and lenders want certainty of offtake before they will fund projects. Airlines, in turn, resist signing long-term offtake agreements at premium prices while cheaper conventional fuel remains available. Each side waits for the other to move first.

That circular hesitation — producers needing demand certainty, buyers needing price convergence — has left the industry in a holding pattern that policy was supposed to break.

The cost of waiting

The consequence is measured in missed capacity. Every year that final investment decisions slip, the supply base stays smaller than mandate timelines assume, and the price premium persists longer than it otherwise would. Aviation's emissions, meanwhile, continue largely unaddressed at the fleet level, since efficiency gains and fleet renewal alone cannot deliver the cuts carriers have pledged.

There is also a competitive dimension. Carriers and jurisdictions that secure early supply positions will hold an advantage as mandates tighten and SAF volumes become scarce relative to compliance demand. Waiting is not a neutral strategy; it defers cost but forfeits position.

What would break the deadlock

Analyses of this kind converge on the same mechanism: someone must absorb the first-mover risk. That could be governments extending purchase guarantees, lessors and financiers structuring SAF-linked instruments, or a small group of carriers willing to lock in long-term contracts and accept near-term margin pressure for supply security later.

Until one of those actors moves decisively, the pattern Corporate Knights describes will hold. The moment will remain ripe — and the market will remain on the fence, with each quarter of delay compounding the supply shortfall the industry will eventually have to finance its way out of.