Germany, Austria and Luxembourg are joining forces to accelerate the market roll-out of renewable, electricity-based jet fuel (electricity-based Sustainable Aviation Fuel, eSAF) in Europe. The three nations are launching a double auction mechanism to achieve this. The scheme brings together producers and buyers. If there is a price gap between the two, state funding steps in. Germany is making up to two billion euros available for this, with Austria and Luxembourg each contributing up to 60 million euros.

 

Federal Transport Minister Steffen Bilger, Germany: “With the eSAF scheme, Europe needs not only ambitious targets, but investment in industrial production. Germany, Austria and Luxembourg are therefore jointly demonstrating how European cooperation can work in practice. We are pooling our funding resources, thus creating better conditions for investment decisions in a future technology. For me, eSAF is not just a matter of climate policy – it’s also an opportunity for industrial policy. If we invest now, added value, know-how and jobs can be generated in Europe. At the same time, we strengthen our independence in energy and delivery chains. We want to facilitate innovation and step by step, make aviation more climate-friendly.”

 

Mobility Minister Peter Hanke, Austria:“With joint sSAF funding, Germany, Austria and Luxembourg are sending a robust signal for developing a European market for renewable jet fuel. We are creating long-term prospects for producers, supporting transparent price signals and contributing to eSAF also becoming available in Austria. At the same time, we are bolstering our resilience and reducing dependence on imports from regions outside Europe. What is decisive here is that with the market roll-out of eSAF, we are generating the conditions for aviation to fulfill its European targets and to cut a substantial amount of CO₂ at the same time. This is an important step for a sustainable aviation industry in Europe.”

 

Minister for the Economy, SMEs, Energy and Tourism Lex Delles, Luxembourg:“Together with Germany and Austria, we are hereby taking the lead as pioneers on a path where not only will we protect the climate, but also support industrial added value in Europe as well as our independence from fossil energy imports.”

 

Minister for Mobility and Public Works Yuriko Backes, Luxembourg:“Luxembourg is standing shoulder to shoulder with Austria and Germany to advance climate-protecting aviation. By joining the ‘eSAF Early Movers’ Coalition’, we are promoting the expansion of eSAF production, reducing dependence on fossil fuels and accelerating their market roll-out across the EU. Luxembourg is taking an active role in the development of a secure, sustainable and competitive aviation sector by fostering new production capacities and helping to ensure that a portion of this production is made available to our own domestic market. With this clear vision for the future, we are creating the conditions today for the sustainable mobility of tomorrow – meeting market requirements as well as reflecting the expectations of our citizens for effective climate protection.”

 

With this joint funding programme, the three founding members of the eSAF Early Movers’ Coalition are taking the next step towards the development and production of sustainable aviation fuels. The funded eSAF amounts will be placed on the market in Germany, Austria and Luxembourg in proportion to the respective funding share of each country.

 

The industrial production of eSAF requires considerable investment. At the same time, there is currently a structural problem: producers require long-term off-take agreements in order to secure investment decisions. However on the other hand, buyers usually enter into contracts for aviation fuels for much short periods. This temporal and economic gap has so far made the building of new production facilities more difficult. But this is precisely where the double action mechanism comes in. In a competitive procedure, eSAF producer offers will be determined on the one hand, and on the other, the demand from consumers. An intermediary will cover the difference between the offer and demand prices with state funding. In this way, long-term production prospects can be combined with competitive supply terms.

 

The goal is to facilitate investment decisions about new eSAF production facilities and at the same time, to develop a competitive market for the purchase of fuel.

 

The funding programme is subject to approval by the European Commission under state aid rules.

 

Dagmar Fehler, CEO and spokesperson of NOW GmbH: “The double auction mechanism is the link between long-term investment security for producers and the short-term procurement processes on the purchasers’ side. As a supporting partner for the Federal Ministry of Transport, we ensure that the funding is designed in a targeted manner to truly accelerate the market roll-out of eSAF in Europe.”

 

Market consultation confirms market interest

 

The Federal Ministry of Transport has now successfully completed the market consultation on the planned German funding mechanism. The consultation was part of the procedure required under state aid law and served to collect feedback from industry and science on the specific design of the funding instrument.

 

The results confirm the widespread interest of the market in an accelerated ramp-up of eSAF production in Europe. At the same time, the feedback underlines the importance of suitable funding instruments in order to overcome the existing obstacles to investment.

 

Further information: eSAF for climate-friendly aviation

 

Electricity-based renewable jet fuel, also known as power-to-liquid, is manufactured from renewable hydrogen and sustainable carbon. The hydrogen is produced through electrolysis with renewable electricity. If the fuel is manufactured according to European sustainability specifications, its greenhouse gas emissions can be drastically reduced over the entire life cycle.

 

For the aviation sector in particular,  liquid energy sources remain indispensable for the foreseeable future. This is true especially for long-haul flights. eSAF therefore provides an important possibility to reduce emissions in aviation. At the same time, existing infrastructures for transport, storage and refuelling can continue to be used.

 

Germany, Austria and Luxembourg belong to the founding members of the eSAF Early Movers’ Coalition, which was launched in December 2025. The coalition was founded with the objective of accelerating the market ramp-up of eSAF in Europe through cooperation, exchange of experiences and joint financial support.

 

About NOW GmbH

 

Since 2008, federally-owned NOW GmbH has been supporting the German government in implementing climate and industrial policy goals. It coordinates strategic projects on climate-friendly mobility and sustainable energy supply and promotes innovative technologies such as electric mobility and charging infrastructure, hydrogen and fuel cells, and alternative fuels. Its core mission is the efficient implementation of federal funding programs in these areas. In addition, NOW GmbH advises policymakers and promotes knowledge exchange through its networks in industry, municipal authorities, associations, and science. Through the National Centre for Charging Infrastructure, it manages the federal government’s activities to expand charging infrastructure in Germany.

 

Source：bmv.de