USD 40.1 Billion
Report ID:
SQMIG10D2046 |
Region:
Global |
Published Date: May, 2024
Pages:
202
|Tables:
63
|Figures:
78
Global Aviation Biofuel Market size was valued at USD 40.1 Billion in 2022 and is poised to grow from USD 42.46 Billion in 2023 to USD 67.16 Billion by 2031, at a CAGR of 5.9% during the forecast period (2024-2031).
The global aviation biofuel market has witnessed significant growth and advancements in recent years. The aviation biofuel market is where sustainable aviation fuels are taking steps to address the aviation industry's growing environmental concerns. These fuels are key drivers in boosting market growth as they meet the industry's needs while addressing environmental issues. The fluctuating oil and gas prices continually impact aircraft fuel, driving up demand due to various new commercial and military applications emerging alongside increased air transport and a growing fleet of airplanes. The aviation fuel industry is expected to grow as major players like United Airlines invest in initiatives to support sustainable aviation fuel (SAF) development. For instance, United Airlines established the sustainable flight fund in February 2023, aiming to assist startups focusing on eco-friendly aviation fuel with over USD 100 million in contributions from companies like Boeing, GE Aerospace, Honeywell, JP Morgan Chase, and Air Canada.
Given aviation's significant greenhouse gas emissions, there's a pressing need to transition to cleaner energy sources for airplanes. Opportunities in the aircraft biofuel sector are projected to increase as more countries commit to reducing emissions under the Paris Agreement, attracting investment into renewable energy markets. However, challenges such as limited raw resources for fuel production, refinery constraints essential for optimal utilization of these sources, and supply chain issues affecting fuel blending and performance may hinder the adoption of environmentally friendly aircraft fuel. Additionally, rising crude oil prices and concerns about lubricant pollution are expected to restrain market growth.
Renewable aviation fuel may not be readily accessible initially, as production capabilities are developed on a contractual basis rather than as a commodity, making it challenging for biofuel plants to achieve sustainability at scale. The increasing costs of developing biofuel plants post-operation further complicates reaching sustainability goals.
Global Market Size
USD 40.1 Billion
Largest Segment
Commercial
Fastest Growth
Military
Growth Rate
5.9% CAGR
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The global aviation biofuel market is segmented based on type, application, and region. By type, the market is segmented into HEFA (Hydro processed esters and fatty acids), HVO (Hydrogenated Vegetable Oil), FT (Fischer-Tropsch), SIP (Synthesized iso-paraffins), and ATJ (Alcohol-to-jet). By application, the market is segmented into commercial and military. By region, the market is segmented into North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.
Analysis By Type
The HEFA segment holds the biggest share and stands out as the largest market within the global Aviation Biofuel market and is the only mature technology. EFA fuel is considered by the Civil Aviation Authority (CAA) as a leading alternative to conventional jet fuel and has been approved by Altair Engineering.
On the other hand, the fastest-growing segment in the global Aviation Biofuel market is the FT segment. This segment, focusing on renewable aviation fuel, is expected to witness increased demand during the forecast period. This growth is attributed to the rising need for FT technology, which can convert approximately 133,000 metric tons of waste annually into bio crude that can be further processed into aviation fuel. Consequently, investments in upcoming sustainable aviation fuel projects are likely to drive the demand for FT technology.
For instance, in January 2022 Johnson Matthey launched an innovative technology, HyCOgenTM, by converting captured carbon dioxide and green hydrogen into sustainable aviation fuel using FT technology.
Analysis By Application
The largest market segment within the Aviation Biofuel market is the commercial category. This is driven by rapid advancements in technology facilitating biofuels in commercial jet fuel. This category encompasses passenger airlines, cargo airlines, and other commercial operators. With a growing emphasis on sustainability and carbon emission reduction, many airlines are actively investigating biofuel use to power their aircraft. Biofuels offer a viable alternative to traditional jet fuel, emitting fewer carbon emissions and helping airlines achieve their sustainability objectives. Moreover, consumer demand for eco-friendly air travel options further propels biofuel adoption in this segment.
On the other hand, the military base segment exhibits the fastest growth in the forecast period, spurred by heightened research and development in the military sector. The military has distinct fuel requirements for aircraft used in defense operations. Integrating biofuels into military aviation can decrease reliance on fossil fuels, bolster energy security, and contribute to overall operational sustainability. Numerous countries recognize the strategic and environmental advantages of biofuels in military applications, initiating programs to explore and integrate biofuels into defense operations.
Beyond commercial and military aviation, aviation biofuels find applications in various other sectors. General aviation encompasses private, recreational, and business flying. Operators such as private aircraft owners and flight schools increasingly consider biofuel use to reduce their carbon footprint and promote sustainable flying practices. Additionally, biofuels are being explored for specialized purposes like emergency response operations, aerial firefighting, and environmental monitoring.
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The dominating region in the Global Aviation Biofuel market is North America, which holds a significant market share. The United States has been a leader in biofuel development, witnessing significant investments in both research and development and large-scale production facilities. The region benefits from a well-established regulatory framework and government support for biofuel initiatives. Major airlines in North America have also committed to reducing their carbon emissions, further boosting the demand for aviation biofuels.
Europe is another significant region in the global aviation biofuel market. The European Union has set ambitious targets for reducing greenhouse gas emissions, particularly in the aviation sector. The region has implemented policies and incentives to promote biofuel use in aviation, including the Renewable Energy Directive and sustainable aviation fuel blending mandates. Several European countries have established biofuel production facilities and actively support research and development in this area.
Asia Pacific is the fastest-growing region in aviation biofuel market. Countries like China, India, and Japan recognize the importance of sustainable aviation and are taking steps to promote biofuel use. China has set targets for aviation biofuel use and has invested in research, development, and production facilities. The region's growing air travel demand, combined with environmental concerns, is driving the adoption of biofuels in the aviation sector.
For instance, on September 2023, PM Modi inaugurated the global biofuels alliance, with 19 countries and 12 international organizations agreeing to join the alliance. This includes both G20 member nations and non-member countries. India, Brazil, and the US serve as the founding members of this alliance. Together, these three founding members contribute approximately 85% of global ethanol production and 81% of consumption. In India's ambitious energy transition journey, the country has pledged to achieve carbon neutrality by 2070.
Additionally, India has set forth an ambitious biofuel roadmap. The government has accelerated its target to achieve a 20% ethanol blending in petrol by 2025-26, compared to the earlier target of 2030. Furthermore, the goal of supplying petrol with a 10% ethanol blend was met in June of the previous year, surpassing the original schedule of November 2022.
Latin America has considerable potential for aviation biofuel production and use. The region boasts abundant biomass resources such as sugarcane, corn, and soybeans, which can serve as feedstock for biofuel production. Brazil has a well-established biofuel industry and has successfully implemented biofuels in its aviation sector. Other countries in the region, like Argentina and Colombia, are also exploring aviation biofuel potential through pilot projects and research collaborations.
The Middle East and Africa region also hold significant potential for aviation biofuel production. With ample sunlight and arid land, the region can cultivate feedstock crops for biofuel production. Countries like the United Arab Emirates and South Africa have expressed interest in developing biofuel production facilities and have initiated research and development projects. Additionally, the region's strategic location as a major air travel hub presents opportunities for biofuel adoption in the aviation sector.
For instance, Gevo, Inc. has collaborated with San Francisco International Airport (SFO), select airlines, and other industry stakeholders to support and promote the utilization and development of Sustainable Aviation Fuels (SAF), an eco-friendly and sustainably sourced substitute for traditional petroleum-based jet fuel.
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Drivers
Enhancements in Aviation Technologies
Volatile Crude Oil Prices
Environmental Concerns
Energy Security and Diversification
Public Perception and Consumer Demand
Restraints
Cost Competitiveness
Policy and Regulatory Framework
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The global aviation biofuel market companies are investing heavily in research and development to diversify their product offerings, thereby fueling further growth in the aviation biofuel market. To thrive in an increasingly competitive market, the aviation biofuel industry must offer cost-effective solutions. One key tactic employed by manufacturers in this industry is local manufacturing to minimize operational costs, thus benefiting clients and expanding market share. The aviation biofuel industry has been instrumental in addressing growing environmental concerns in recent years, offering significant advantages in this regard.
Top Player’s Company Profile
Recent Developments
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyzes the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
According to our global Aviation Biofuel market analysis, there are several factors that shape the path of Aviation Biofuel market. The aviation biofuels market is undergoing remarkable growth fueled by environmental regulations, fluctuating oil prices, and growing investments. Despite challenges like production costs and infrastructure limitations, the market offers substantial opportunities for biofuel producers, airlines, and governments. The aviation biofuel segment has the major share, and the military base segment is quickly growing these days. Asia Pacific is experiencing rapid growth due to increasing travel demand and efforts to enhance technology in a better way. Adoption of sustainable aviation fuels is the major trend leading the market. Government backing, technological advancements, emerging markets, and ongoing research and development endeavors are projected to drive market growth. As the aviation industry shifts towards sustainability, aviation biofuels are set to play a pivotal role in curbing carbon emissions and attaining long-term sustainability objectives.
Report Metric | Details |
---|---|
Market size value in 2022 | USD 40.1 Billion |
Market size value in 2031 | USD 67.16 Billion |
Growth Rate | 5.9% |
Base year | 2023 |
Forecast period | 2024-2031 |
Forecast Unit (Value) | USD Billion |
Segments covered |
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Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
Companies covered |
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Customization scope | Free report customization with purchase. Customization includes:-
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Executive Summary
Market overview
Parent Market Analysis
Market overview
Market size
KEY MARKET INSIGHTS
COVID IMPACT
MARKET DYNAMICS & OUTLOOK
Market Size by Region
KEY COMPANY PROFILES
For the Aviation Biofuel Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Aviation Biofuel Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
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With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Aviation Biofuel Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Aviation Biofuel Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
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Category Intelligence: Customized intelligence that is relevant to their supply Markets will enable them to make smarter sourcing decisions and improve their category management.
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Report ID: SQMIG10D2046
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