Europe’s STIP: A Promising Lift-Off for Aviation Decarbonization — But the Turbulence Isn’t Over Yet

The European Commission’s unveiling of the Sustainable Transport Investment Plan (STIP) marks a pivotal moment in the continent’s push to decarbonize air transport.

For the first time, Brussels formally acknowledges longstanding structural issues hampering Sustainable Aviation Fuel (SAF) adoption — from unrealistic mandates to distorted pricing and inadequate market mechanisms.

Yet, while aviation leaders have welcomed the shift in tone, the industry is clear: Europe has taken a crucial step, but not a decisive leap.

A Welcome Reality Check: Commission Admits the Market Isn’t Working

For years, the EU’s aviation decarbonization strategy has been held back by a simple but stubborn reality: SAF is expensive, scarce, and hard to scale.
The Commission’s new plan recognizes this — a move IATA calls “significant and overdue.”

Key improvements signalled in STIP include:

• Support for SAF under the EU ETS

• Exploration of tradable SAF certificates and book-and-claim

• Simplified reporting and better access to sustainability certificates

• Moves toward aligning EU RED and CORSIA — essential for global harmonization

But recognition is only the first step. As IATA Director General Willie Walsh cautions, “we need to see how words turn into reality.”

Europe’s Aviation Puzzle: SAF Supply Is Growing — But Can't Reach Every Airport

The Case for Book-and-Claim

Europe’s SAF challenge isn’t just insufficient supply — it’s also uneven distribution. Many airports cannot access SAF physically, even if airlines are willing to buy it.

That’s why a functioning book-and-claim system — letting airlines purchase SAF even if it’s supplied at another airport — is considered indispensable.

STIP acknowledges this mechanism’s potential, but misalignment between ReFuelEU and EU ETS rules still blocks Europe-wide implementation.

A simple regulatory fix in the upcoming EU ETS review could unlock massive investment in SAF production by giving buyers certainty and flexibility.

Without it, Europe risks fragmentation, inefficiency, and stalled SAF investment.

Demand-Side Blind Spots: The Missing Piece of Europe’s SAF Strategy

While Europe focuses heavily on supply-side incentives, airlines — the actual buyers — remain under-supported.

Under the current framework, operators face:

• Higher jet fuel costs

• A volatile and opaque SAF pricing environment

• Limited transparency in sustainability certification

• Insufficient clarity on future SAF availability

A predictable, transparent SAF market is essential if airlines are expected to integrate SAF into daily operations — and budget for it long-term.
Strengthening and accelerating the Union Database (UDB) is central to this transformation.

IATA has urged the Commission to prioritize these end-user realities rather than treating airlines as passive recipients in the SAF ecosystem.

Technology Bias Could Slow Progress: Why Europe Needs a Neutral SAF Roadmap

STIP’s heavy emphasis on e-SAF — citing feedstock limitations for biofuels — risks narrowing the pathway to scale.

IATA’s latest feedstock assessment reveals a different picture:
Europe has significant untapped potential in advanced residues, waste streams, and other sustainable bio-based feedstocks.

A technology-neutral policy, supporting both e-SAF and bio-SAF, is essential to:

• Expand feedstock diversity

• Accelerate production scale

• Ensure cost-competitive SAF supply

• Hit the EU’s long-term target of 500 million tonnes by 2050

Over-prioritizing e-SAF could slow deployment, inflate costs, and delay meaningful carbon reductions.

The Road Ahead: Progress, Yes — But Not Enough for Net Zero 2050

STIP delivers important signalling, but Europe’s aviation sector needs clear timelines, stronger coordination, and a more flexible regulatory base to succeed.

As Willie Walsh puts it, the industry is committed to net-zero by 2050, but this commitment will only hold if policy frameworks match the scale and urgency of the challenge.

Aviation is ready to invest. Europe must now ensure its policies unlock — rather than hinder — those investments.