The mandate, briefly
Regulation (EU) 2023/2405 requires aviation fuel suppliers at qualifying EU airports to deliver a minimum share of sustainable aviation fuel in the jet fuel they place on the Union market. The trajectory: 2% in 2025, 6% in 2030 (with a 1.2% e-SAF sub-mandate), ramping to 70% by 2050. Penalties are set at a minimum of twice the price gap between SAF and fossil jet, calculated per tonne of shortfall.
What happened in 2025
The mandate created exactly the demand signal the industry had been waiting for. For the first time, European fuel suppliers had a legal obligation to procure SAF — not a voluntary target, not a corporate sustainability pledge, but a regulatory requirement with financial teeth.
The result was a scramble. Fuel suppliers who had started securing SAF supply contracts in 2023-2024 were positioned. Those who hadn't were left competing for a thin spot market at premium prices. HEFA-pathway SAF, the only commercially mature option at scale, saw demand spike at the same time that feedstock prices (particularly UCO and tallow) remained elevated.
The mandate worked. Demand materialised. But supply didn't keep pace — and the gap between what was mandated and what was physically available became the defining tension of year one.
Supply vs. mandate: the numbers
Europe consumed approximately 53 million tonnes of jet fuel in 2025. A 2% blend mandate implies roughly 1.06 million tonnes of SAF needed. Total European SAF production capacity in 2025 — across all operational HEFA, ATJ, and co-processing facilities — was estimated at 1.8-2.2 million tonnes, but much of that capacity serves global demand, not just the EU.
The effective SAF supply available to EU airports was likely in the range of 0.7-0.9 million tonnes — short of the 1.06 Mt mandate by 15-35%. The shortfall varied dramatically by airport and by fuel supplier. Major hubs (AMS, FRA, CDG, LHR-adjacent) had better access; smaller airports in Southern and Eastern Europe struggled.
What the penalties look like
The first compliance reports are due by March 2027 (covering the 2025 calendar year). At that point, each fuel supplier's actual SAF delivery volume will be compared to the 2% obligation, and shortfalls will trigger the Article 12 penalty.
At current SAF-to-fossil price spreads (~$2,500/tonne), a 1,000-tonne shortfall generates approximately €4.6-5.0 million in penalties. For a major fuel supplier serving multiple EU hubs, aggregate exposure could reach eight figures. The penalties are deliberately punitive — designed to make non-compliance strictly more expensive than procurement.
Three things year one proved
- Mandates create markets. The theoretical debate about whether regulatory demand signals would drive SAF procurement is settled. They do. EU SAF offtake agreements signed in 2025 exceeded any previous year by a factor of 3×.
- HEFA alone isn't enough. The feedstock ceiling for lipid-based SAF is real and binding. Year one showed that even a 2% mandate strains the available supply when the entire EU moves at once. At 6% (2030), the math is impossible without Fischer-Tropsch, ATJ, and PtL capacity coming online.
- The e-SAF sub-mandate is the real game-changer. Starting in 2030, 1.2% of the 6% must be synthetic (RFNBO). This is the only regulatory instrument globally that creates guaranteed demand for Power-to-Liquid — and it's why the earliest large-scale PtL FIDs are targeting European delivery.
What it means for 2030
If the EU struggled to meet 2% with existing HEFA capacity, how will it meet 6%? The answer lies in the construction pipeline. Our project tracker currently shows 71 SAF facilities under construction globally, with 28 specifically targeting European delivery. If those projects hit their commissioning timelines — a big if, given construction-cycle realities — new capacity of approximately 4-5 million tonnes should come online between 2027 and 2030.
That would be enough for 6% if European jet fuel demand stays flat. If demand grows (as IATA projects), the margin of safety narrows. And the 1.2% e-SAF sub-quota will require dedicated PtL and RFNBO capacity that is, as of April 2026, still largely pre-FID.
Year one of ReFuelEU was a proof of concept. It proved the mechanism works. It also proved that the supply side of the market has four years to build what it took HEFA two decades to achieve.
What to watch next
- March 2027: First compliance reports due. Penalty amounts become public. This is the moment the market learns which fuel suppliers were short.
- Q3-Q4 2026: UK Revenue Certainty Mechanism first-round awards — determines which PtL projects get the bankability backstop to reach FID.
- 2027-2028: The construction wave. If the 71 under-construction facilities stay on schedule, SAF availability doubles by end-2028.
- 2030: The step-up to 6% total + 1.2% e-SAF. The first real test of whether the multi-pathway production base can meet a mandate that HEFA alone cannot serve.
Bottom line
ReFuelEU year one did what mandates are supposed to do: it created a market. The supply gap that followed isn't a failure of policy — it's the predictable consequence of demand running ahead of industrial capacity in a nascent market. The question now is whether the investment community, the project developers, and the technology providers can close that gap before 2030 turns theoretical ambition into compliance exposure.
For the latest data on the project pipeline, feedstock prices, and regulatory updates, explore the Market Intelligence module or download the free Q2 2026 quarterly report.