Financing Sustainable Aviation Fuels 2025

3 Guarantees and insurance: Loan guarantees, first-loss capital and insurance solutions such as currency risk insurance can help mitigate risks for SAF projects. For example, the US Department of Energy’s Loan Programs Office supports SAF production through financial guarantees, improving bankability and lowering interest rates for projects. 4 Strategic investments: Collaboration with airlines, airports, OEMs and energy players fosters a supportive ecosystem and provides demand assurance. Recent investments from airlines, energy companies and other investors illustrates how strategic partnerships enhance bankability. 5 Long-term offtake agreements: Securing binding, long-term offtake agreements with airlines and corporations provide stable revenue and reduce demand uncertainty, a critical step for reaching FID. For example, IAG’s 14-year agreement with PtL producer Twelve ensures consistent revenue, strengthening the project’s appeal to investors. 6 Book-and-claim mechanisms: This approach allows individual and corporate travellers to take a more active role in funding SAF projects, through scope 3 emissions certificates, thereby increasing demand and diversifying revenue. A number of book-and-claim systems are being developed, with an increasing number of supplier-corporate partnerships such as those established by World Energy. Collective procurement platforms are also gaining traction. 7 Private equity investment: Private equity capital can accelerate commercialization and scale SAF projects rapidly. These investors typically bring both capital and operational expertise. EcoCeres, for instance, raised substantial funding from Bain Capital, which facilitated significant production capacity expansion. 8 Infrastructure investors: SAF projects seeking large-scale capital can attract infrastructure investors who often have lower capital costs and a long-term investment horizon. Such investors provide substantial funds and management expertise, enabling the construction of large SAF facilities. Brookfield Asset Management’s $1.1 billion commitment to Infinium demonstrates the pivotal role that infrastructure investors can play in scaling-up SAF production. 9 Tolling model: SAF facilities using a tolling model can mitigate market risks by charging a fixed fee for refinery capacity while customers supply feedstock and retain ownership. Although this model is still nascent for SAF, it has worked successfully in other sectors (e.g. Cedar’s tolling agreement for liquified natural gas), potentially enabling projects to secure debt financing at more favourable terms due to predictable cash flows. 10 Green bonds: Issuing green bonds tied to SAF production can offer a powerful tool for raising impact-driven capital. Green bonds help SAF projects meet environmental standards and they are attractive to impact investors. New greenfield SAF refineries will be critical if the industry expects to meet its 2030 climate goals. The combination of collaboration structures and financing models presented in this report can help break down barriers to boost SAF production and the sustainability of flying in the future. None of these models will work in isolation – to scale-up SAF, project developers will need to explore as many of these options as possible. 5 Financing Sustainable Aviation Fuels