The European Commission has unveiled a €2.9 billion initiative aimed at boosting investments in green fuels by 2027, targeting carbon dioxide emissions from aviation and maritime sectors, which collectively contribute approximately 26.4% of the EU’s transport emissions. With the EU’s objective of achieving climate neutrality by 2050, reducing emissions in these sectors poses significant challenges. Despite existing legislation, commercial planes and ships predominantly rely on fossil fuels, making decarbonization particularly difficult.
The Commission anticipates that around 20 million tonnes of sustainable fuels, including biofuels and e-fuels, will be necessary by 2035 to meet green fuel targets. Achieving this goal will require an estimated €100 billion in investments. The nearly €3 billion allocated will be sourced from the EU’s multiannual budget through 2027, focusing on renewable and low-carbon fuel technologies. Under current regulations, the maritime sector must cut greenhouse gas emissions by 2% starting in 2025, with an 80% reduction in intensity expected by 2050.
In aviation, sustainable aviation fuel (SAF) is projected to constitute 20% of fuel at EU airports by 2035, with a specific requirement for e-SAF, a synthetic jet fuel. By 2050, green fuels must make up 70% of aviation fuel, with e-SAF accounting for half of that. However, the current supply of bio and e-SAF is insufficient to meet future demands, prompting industry leaders to call for action to make SAF more affordable and accessible, ensuring the competitiveness of European airlines.
While over 40 e-fuel production projects are in the planning stages within the EU, none have reached final investment decisions yet. Challenges in scaling up e-fuels include the availability and cost of renewable energy and carbon capture technologies. Advocates for the initiative emphasize the need for the EU to establish effective financial instruments to stimulate production. Concerns have also been raised regarding biofuels, with calls for prioritizing e-fuels in upcoming auctions to ensure a genuine transition to sustainable energy sources in the aviation and maritime sectors.
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