The UK Government has unveiled a new £219 million funding programme aimed at accelerating domestic sustainable aviation fuel (SAF) production, with ministers hoping the investment will strengthen the country’s position as a global leader in low-carbon aviation while creating thousands of skilled jobs.
The new Low Carbon Fuels Fund (LCFF), due to launch later this summer, will make £93 million available over the next two years to companies developing projects that are close to commercial production. Applications are expected to open in mid-July.
The announcement marks the latest stage in the Government’s drive to establish a homegrown SAF industry, building on the £198 million already allocated through the Advanced Fuels Fund since 2022.
According to Government estimates, a thriving UK SAF sector could support around 15,000 jobs and contribute as much as £5 billion to the economy by 2050, while reducing reliance on imported fuels and helping aviation meet its long-term decarbonisation goals.
Aviation, Maritime and Decarbonisation Minister Keir Mather described the investment as “the next chapter in Britain’s green aviation revolution”, saying it would back British innovation while creating high-skilled employment opportunities across the country.
Sustainable aviation fuel is widely regarded as one of the aviation industry’s most important tools for reducing emissions in the coming decades. Produced from sustainable feedstocks rather than conventional fossil fuels, SAF can reduce lifecycle greenhouse gas emissions by around 70% on average compared with traditional jet fuel, while requiring minimal changes to existing aircraft and airport infrastructure.
The Government’s latest funding initiative is designed to help bridge the gap between research and commercial-scale production by supporting projects that are closest to becoming operational.
Alongside the funding announcement, ministers have launched a Call for Evidence examining how the industry can continue to meet the UK’s Sustainable Aviation Fuel Mandate, which requires an increasing proportion of jet fuel supplied in the UK to come from sustainable sources.
The mandate began with a 2% requirement in 2025 and is set to rise to 10% by 2030 before reaching 22% by 2040. The Government stressed that these overall targets are not being reconsidered, but that the consultation will help ensure the framework remains effective as the global SAF market evolves.
Industry leaders welcomed the announcement.
British Sugar, which is developing its British BioJet project at Wissington using waste-derived ethanol-to-jet technology, said the new funding would support continued progress towards building a demonstration plant capable of producing around 1,500 tonnes of SAF.
Meanwhile, LanzaTech praised the investment for reinforcing the UK’s position in sustainable fuel production. The company is working on a proposed facility in Humberside which, if completed, could eventually produce enough SAF to meet approximately 1% of UK jet fuel demand while converting waste carbon into aviation fuel.
As airlines face increasing pressure to reduce emissions without compromising growth, the success of projects backed by the new Low Carbon Fuels Fund could play an important role in determining whether the UK becomes a major producer of sustainable aviation fuel or remains reliant on imports from overseas.
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