EU Subsidises Sustainable Aviation Fuel to Boost Airline Emission Cuts

Lufthansa Group and Airbus have partnered to introduce a Sustainable Corporate Value Fare that allows businesses to offset up to 30% of CO2 emissions from business travel by using sustainable aviation fuel (SAF), which can reduce lifecycle carbon emissions by up to 80% compared to traditional jet fuel. Lufthansa began implementing this fare for Airbus employees' domestic flights in Germany in June 2025, supporting companies' growing emphasis on sustainable travel choices. Meanwhile, Tigerair Taiwan will use a 5% SAF blend on all A320neo delivery flights starting in 2025, aligning with Taiwan's goal for a 5% SAF blend across all airlines by 2030. In Europe, the EU is subsidizing SAF production to help airlines bridge the cost gap between conventional fuel and SAF, aiming to meet targets of 2% SAF use at EU airports in 2025 and 6% by 2030, despite industry concerns about the feasibility of these goals given current investment levels and SAF supply constraints. Additionally, a French aerospace consortium has launched the TAGINE project to develop hybrid-electric propulsion for small regional aircraft, targeting significant decarbonization in the 6- to 10-seat market by 2027, reflecting broader innovation efforts across the aviation sector to reduce emissions. These initiatives collectively highlight the aviation industry's multifaceted approach to sustainability, combining fuel innovation, policy support, and technological development.