EU Allocates €100m in ETS Allowances for Airlines' Sustainable Fuel Purchase

EU ETS Allowances for Sustainable Aviation Fuels

On 12 September 2025, the European Commission adopted a decision to allocate EU ETS emission allowances to airlines for using sustainable aviation fuels (SAF) in 2024. This initiative is part of the EU Emissions Trading System (ETS) to promote SAF uptake and follows calculations by Member States’ authorities for commercial airlines.

Support System and Financial Allocation

The latest amendment to the EU ETS Directive introduced a support system to accelerate SAF use by granting free EU ETS allowances. Starting in 2024, 20 million EU ETS allowances, valued at approximately €1.5 billion, are set aside for this purpose. For the first year, 2024, the support amounts to about 1.3 million allowances, worth around €100 million, distributed among 53 operators.

Price Difference Coverage

The support system covers the price difference between fossil kerosene and eligible SAF used by commercial aircraft operators on flights covered by effective carbon pricing through the EU ETS. This support is in addition to the EU ETS incentive for using SAF, as operators are not required to surrender allowances for these fuels, an advantage worth about €25 million in 2024. Combined, the ETS incentive for SAF use in 2024 amounts to around €125 million.

Commitment to Climate Objectives

By publishing ETS SAF support prices, the Commission ensures a transparent support mechanism, reinforcing its commitment to scaling up sustainable fuels in Europe and advancing broader EU climate objectives. The EU ETS also finances the Innovation Fund to support innovative clean tech projects, including in the aviation sector, to further reduce its climate impact.