London: Global energy and commodity price reporting agency Argus has introduced the world’s first assessed price for UK sustainable aviation fuel (SAF) certificates, marking an expansion of its coverage of the northwest European SAF market, reports PR Newswire.
The new pricing benchmarks are expected to help companies better manage their compliance with the UK’s SAF mandate. The assessments will allow industry participants to compare the cost of buying SAF certificates, blending physical bio-SAF produced from hydrotreated esters and fatty acids (HEFA) feedstock, and paying buy-out costs if they do not meet their obligations.
Argus Media chairman and chief executive Adrian Binks said that as SAF mandates continue to increase, companies will need dependable pricing not only for the fuel but also for certificates. He said the agency has worked closely with industry stakeholders to create the new assessment, which is designed to bring greater transparency as the aviation sector adapts to stricter carbon-reduction rules.
The new benchmark will track certificate prices that qualify for meeting the UK SAF mandate and are based on SAF produced using HEFA feedstock. These certificates, which are tradeable, are issued when eligible SAF is supplied in the UK and are later used by obligated companies to fulfil their mandate requirements. The system allows firms that exceed their quota to sell surplus certificates to companies that need them.
Beginning in 2025, jet fuel suppliers in the UK must blend 2% SAF into domestic aviation fuel deliveries. The mandate will rise each year, reaching 10% by 2030 and 22% by 2040. As these targets grow, transparent prices for UK SAF certificates are expected to become increasingly important.
The new SAF certificate price adds to Argus’ existing assessments for tradeable biofuel tickets used for road transport mandates in the UK and several EU nations. The agency also provides a range of physical SAF prices in northwest Europe, including those for HEFA-based SAF and modelled production costs for electrolytic SAF (e-SAF).
