Decarbonizing Cement and Concrete: Are Their Emissions Set in Stone?

Key Takeaways

• The Nasdaq Carbon Issuance Calendar, a new data platform, provides carbon removal buyers and suppliers with standardized information on future offtake availability, indicative pricing, and project maturity. The platform was developed in collaboration with Relae, formerly Carbon Direct.
• The Carbon Issuance Calendar addresses the fragmentation and transparency problems of the voluntary carbon market by centralizing standardized project data and embedding our scientific diligence framework, built over 900 project reviews, giving buyers delivery-risk insight that no registry or marketplace offers today.
• The Carbon Issuance Calendar is an important early step, not the whole journey: it shows buyers what durable tonnes exist and allows them to compare projects with apples-to-apples data. 
• Buyers can move from the Carbon Issuance Calendar into technical diligence, contracting, and project assurance with Relae’s advisory team. Suppliers can register to connect with buyers who are ready to engage.

Carbon Removal Project Data Has a Visibility Problem

If you're sourcing durable carbon removal credits, you may run into a familiar wall: project data scattered across dozens of developer websites, presented in inconsistent formats, with no easy way to compare one project against another. If you're a project developer, you face the mirror image of that problem: fielding individual requests for proposals, with no central place to showcase your available tonnes.

Get this wrong, and buyers may end up counting on carbon removal that never shows up - the delivery risk bugbear.

Between 2022 and 2024, high-durability engineered carbon removal made up just 2 percent of all carbon credit issuances. They remain in short supply, particularly the high-quality supply corporate buyers need. The gap is set to widen: our 2026 State of the Voluntary Carbon Market report found that more than 80% of the 2030 high-durability carbon removal projects are at risk of stalling and failing without additional offtake and financing commitments.

The Nasdaq Carbon Issuance Calendar, developed by Nasdaq in collaboration with Relae, offers an important first step toward addressing this information gap.

What Is the Nasdaq Carbon Issuance Calendar?

The Carbon Issuance Calendar is a centralized, accessible dashboard where carbon removal buyers and suppliers view standardized project data: future credit availability, indicative pricing, and project delivery status, all in one place. 

The Nasdaq Carbon Issuance Calendar combines structured, developer-provided project data with project maturity assessment informed by Relae’s assessment framework and technical diligence. This helps users understand future CDR availability, indicative pricing, and potential project delivery risk through a single platform.

This expertise didn't appear overnight. It comes from sitting across the table with developers, stress-testing their science, mapping their delivery timelines against reality, and helping them show up to buyers as credible partners. The result is a track record that gives the framework embedded in the Carbon Issuance Calendar its depth. It's a starting point, built for buyers and suppliers to find each other on the basis of consistent, comparable information, using international class financial and information infrastructure.

How Buyers Should Use the Nasdaq Carbon Issuance Calendar

Today, if you're trying to procure durable carbon removal credits, you have no single place to start. You have to visit individual developer sites, request information through scattered channels, and compare projects that present data in entirely different formats before diligence has even begun. In many cases, you are comparing apples to oranges - different kinds of CDR projects with different durabilities, risks, and overall quality. 

The Carbon Issuance Calendar provides a central starting point. You can view future credit availability, compare indicative pricing across projects, and begin assessing options without contacting each supplier one by one.

More importantly, the Carbon Issuance Calendar frames the data. Our scientists developed a delivery-oriented lens, built from reviewing over 900 carbon removal projects, drawing on the same rigor behind our Criteria for High-Quality Carbon Dioxide Removal, which we develop annually with Microsoft.

How Suppliers Reach Buyers Through the Carbon Issuance Calendar

If you're a project developer, the Nasdaq Carbon Issuance Calendar tackles visibility, one of the most persistent barriers to market access. You can list available tonnes, display indicative pricing, and reach a global audience of corporate and financial buyers at no cost.

The timing matters. Many first-of-a-kind engineered carbon removal projects are preparing to break ground and need bankable offtake agreements to secure financing before they can do so (a key aspect of CDR 2.0). Our analysis of approximately 140 high-durability carbon removal project developers found scale-up plans for 30 million tonnes of supply per year. Reaching that potential will take real demand: committed forward offtake, increased project equity investment, and access to lending. 

Register now: you'll be positioned to connect to buyers actively looking to engage.

How Does the Carbon Issuance Calendar Differ From a Carbon Credit Registry or Carbon Removal Marketplace?

The Carbon Issuance Calendar solves a distinct, early-stage problem. It gives buyers and suppliers a centralized place to find each other and compare options against standardized information, something neither a registry nor a marketplace is built to do.

For a closer look at how registries differ and what you should weigh when navigating them, read our Navigating Carbon Credit Registries report.

Scientific Diligence Turns Visibility Into Confidence

Standardized data tells you what exists. Scientific diligence tells you what's worth pursuing. 

Relae’s scientists do that work every day. Our experts apply rigorous pathway-specific criteria to live projects, evaluating delivery risk and status, and identifying where questions remain is the core of what we bring to the carbon removal market.

The Carbon Issuance Calendar puts an accessible version of that expertise at the top of the procurement funnel. It’s for everyone in the market - you don't need to be a carbon removal scientist to use it. This snapshot allows you to compare projects against each other, giving you a meaningful starting point before deeper diligence begins. 

Want to go deeper on a specific project? Relae’s technical diligence team picks up right where the Carbon Issuance Calendar leaves off.

What Carbon Removal Projects Are on the Carbon Issuance Calendar Today?

The Carbon Issuance Calendar currently features engineered and hybrid carbon removal projects: direct air capture, biochar, enhanced rock weathering, and bioenergy with carbon capture and storage. These high-durability pathways offer permanence on the order of hundreds to thousands of years.

Many of these projects are at an inflection point: they’re ready to scale but dependent on committed offtake to unlock financing. The Calendar serves their needs, and the buyer’s needs, together.

Nature-based carbon removals have their own criteria and market dynamics. They may appear in a separate segment of the Carbon Issuance Calendar down the line.

From the Carbon Issuance Calendar to Completed Carbon Removal Procurement

If you're building or refining a carbon removal procurement strategy, the Carbon Issuance Calendar is the right place to start. 

From there, you can choose to work with the Relae advisory team to support every later stage: technical diligence on specific projects, contracting and negotiation support, ongoing project assurance, and access to curated carbon credit sourcing. The Carbon Issuance Calendar surfaces the market; we help you navigate it, connecting you with the right developers, on the right terms, with the scientific confidence to move forward.

Moving from commitment to delivery takes structural change across the market, too—our CDR 2.0 white paper lays out the five pillars we see as essential to getting engineered and hybrid carbon removal projects built and delivering.

Key Takeaways

• Trust in carbon credits remains low. In part, this is because many mistakenly treat every credit type as interchangeable.
• Reduction, removal, and avoidance credits are verified against fundamentally different baselines, so credit quality must be judged based on type and project specifics, never with one blanket standard.
• The Integrity Council for the Voluntary Carbon Market's Core Carbon Principles now give buyers an independent bar to check against, including 44 methodologies approved across 13 eligible crediting programs, as of August 2026.
• Removal credits still make up only 5–6% of the market, even as compliance-driven demand accelerates, per our 2026 State of the Voluntary Carbon Market report.

Three Types of Carbon Credits: Reduction, Removal, and Avoidance

A carbon credit is a mechanism that allows one party to compensate another for their carbon mitigation activities. Based on their net emissions impact, there are three types of carbon credits: reduction, removal, and avoidance. 

1. Reduction credits reflect activities that decrease greenhouse gas emissions, compared to prior practices. 
2. Removal credits reflect activities that remove carbon dioxide already present in the atmosphere and oceans and lock it away for decades, centuries, or millennia.
3. Avoidance credits reflect activities that prevent greenhouse gases from being emitted in the first place. For all three types, credits are assessed and issued by measuring or estimating how much carbon is reduced, removed, or avoided as a result of a credit purchase and its associated activities.

While credits are assessed in different ways depending on the type, one of the most important indicators of quality is a project's baseline - the emissions that would be present in a business-as-usual scenario, without action being taken to reduce, remove, or avoid them. Project developers use baselines as a means of comparison to assess the net emissions impact of a project. 

• Baselines must be accurately set and data-driven. 
• Emissions impacts of a project must be correctly calculated against its baseline. 

Reduction, removal, and avoidance projects involve very different activities and, for some types of projects, it may be more challenging to establish an accurate baseline. However, without accurate baselines, climate impacts cannot be reliably determined.

Across the voluntary carbon market, Reduction credits represent roughly 20% of the purchases. Removal credits represent roughly 5% of the purchases. The remainder, roughly 75%, are avoidance credits.

Carbon Reduction Credits

Carbon reduction must drive the majority of our push to net zero, but translating carbon reduction activities into carbon credits that can be purchased is challenging. Examples of activities represented by carbon reduction credits include reducing fossil fuel use by improving fuel efficiency, or programs that reduce the methane that is generated from farms or municipal waste processing. 

Reduction credits are measured and quantified against the baseline emissions of an existing technology or process. Some reduction credits are easy to track and measure, such as efficiency investments or destruction of fugitive methane. Other projects are more complex. For example, low-emission cookstove projects in developing regions rely on tracking patterns of cookstove use and quantifying emission factors for various fuel and stove combinations, both of which are hard to do. The result, as studies have shown, sometimes leads to overcrediting in reduction projects. 

Superpollutant Credits

One class of reduction credit, superpollutant credits, has garnered recent attention. These credits involve the reduction of non-CO2 greenhouse gases with very strong radiative forcing, such as methane, nitrous oxides, or fluorinated gases like chlorofluorocarbons. These are not a substitute for CO2 removal, but can provide rapid and profound reductions at modest cost. Many different kinds of superpollutants exist in today’s market, worth roughly $60M today. Recent purchases by tech companies and others have highlighted the potential of these reduction credits.

Another class of reduction credit, transition credits, involves the deliberate early closure of emitting assets like coal-fired power plants or heavy manufacturing facilities. Early efforts by governments, banks, and companies around the world under the Just Energy Transition Partnership agreement jump-started transition credits as a concept at COP26. The Kinetic Coalition, in partnership with many groups including Relae, has launched work to bring transition credits to market with several pilot efforts, including closing a coal plant in the Philippines 10 years early. 

Carbon Removal Credits

Projects that remove carbon come from a diverse set of solutions, from nature-based solutions like reforestation, to hybrid solutions like biochar, to engineered solutions such as direct air capture and storage. Roughly 5–6% of credits on the voluntary carbon market today are classified as removals, up from roughly 3% a few years ago.

Carbon removal baselines are determined differently depending on whether a project uses an engineered, hybrid, or nature-based solution. For engineered removals, the baseline is zero, because no carbon removal was occurring in the absence of the project. The credited removal will be the difference between the quantity of carbon removed and any emissions that occur to facilitate the removal (determined through a carbon credit life cycle assessment). Baselines for hybrid and nature-based removals can be more challenging. In natural systems, changes in carbon stocks created by removals must be measured and approximated over time, and creditable removals represent the additional carbon removed by the intervention relative to the baseline (e.g., fallow land versus a reforestation project).

Another important consideration for carbon removal credits is project durability, a measure of the likely duration of carbon storage. Stored carbon can re-enter the atmosphere either through deliberate actions (e.g., deforestation) or accidental ones (e.g., wildfires). Nature-based removals are especially vulnerable to being re-released and are usually considered less durable (i.e., stored for less than 50 years). In contrast, engineered solutions offer high durability (i.e., stored for hundreds to thousands of years), and hybrid removals also offer durability periods that are typically longer than those of nature-based removals.

While less durable, nature-based solutions are effective, cost-effective, and widely available today. They made up over 95% of all carbon removal credits issued in 2025. Engineered and hybrid solutions are more expensive and scarce but offer longer durability. Prices of engineered carbon removal are likely to fall with innovation and increased market participation, but are currently much higher than most nature-based credits. With SBTi's finalized Corporate Net-Zero Standard V2.0, this balance is likely to shift. Large companies must now purchase removal credits covering 1–100% of scope 1, scope 2, and scope 3 emissions between 2035 and their net-zero year, with an explicit focus on more durable CO2 removal credits.

Carbon Avoidance Credits

Examples of carbon avoidance include avoiding deforestation that would result in the release of carbon dioxide into the atmosphere or clean energy projects that avoid the release of emissions from burning fossil fuels in possible facilities. This can be confusing, since many avoided credits are called reduction credits, as is the case with projects under the Reducing Emissions from Deforestation and Forest Degradation (REDD+) framework. Avoidance credits make up roughly 75% of certified credits on the voluntary carbon market today - an overwhelming majority - in part due to high availability and low price. 

Avoiding emissions is an important goal with numerous environmental, climate, community, and other benefits. Relae works with clients and customers across industries on developing and implementing strategies to avoid emissions within their value chain. However, there are significant challenges with the way that many carbon avoidance credits are created.

• Carbon avoidance credits are based on an estimate of the emissions that might have existed had a project not been funded. Because it is impossible to observe what might have happened in the absence of a project, carbon avoidance estimates are determined by considering historic data and contextual information. Statistical models can be used to create a presumed baseline that represents what would have happened in the absence of the project.

• Because the baseline is not observed in an avoided emissions project, there is uncertainty in calculating the number of carbon credits it produces. If the baseline is not set accurately, a project can overcredit. While the lack of a directly observed and measured baseline means avoidance credits will always have some degree of uncertainty, high-quality avoidance projects present compelling evidence to support their baselines, greatly reducing uncertainty. 

New datasets, statistical techniques, and methodologies are providing opportunities for developing avoidance credits with more certainty. Three REDD+ methodologies have now cleared the Integrity Council for the Voluntary Carbon Market (ICVCM) assessment for its Core Carbon Principles (CCPs), a concrete sign that credit quality standards for avoidance projects are maturing.

Defining and Standardizing Quality in the Voluntary Carbon Market

Carbon credits are intended to reduce, remove, or avoid emissions. They pay for an environmental service that must be delivered. Companies working to generate climate benefits through credit purchases must grapple with the differences and uncertainties of credit quality to ensure that the intended benefits are realized. 

While high-quality credits exist for all types of projects, a rich understanding of the differences in methodologies, geographies, physics, and ecology is required to identify high-quality projects and understand varied certainty, durability, and risk terms. Identifying high-quality carbon projects demands extensive and project-specific diligence beyond carbon market certification.

Our own diligence work reveals that high-quality projects can be hard to find. Fewer than 10% of the carbon removal projects we assessed for our 2026 State of the Voluntary Carbon Market report met our quality criteria. This diligence work now has an additional, independent backstop. As of August 2026, the ICVCM has approved 44 methodologies across 13 programs, as eligible for its CCP label, including ACR, Gold Standard, and VCS. For buyers, considering projects that are CCP-eligible should be used as a first filter—not a substitute for project-level diligence, but representing a legitimate floor.

While realized emissions impacts may be difficult to prove in some cases, it is important to remember that some projects provide additional co-benefits. REDD+ projects, for example, may have a positive impact on conservation and biodiversity, and cookstove projects may offer clear human health and social welfare benefits. However, these benefits should be assessed separately from carbon reduction, removal, or avoidance benefits.

Frequently Asked Questions

What's the difference between a carbon credit and a carbon offset? 

A carbon credit represents one verified tonne of emissions reduced, removed, or avoided. A  carbon offset describes how a buyer uses that credit, typically to counterbalance emissions it has not yet accounted for. The credit itself does not change type based on how it's claimed.

Which type of carbon credit—reduction, removal, or avoidance—is highest quality? 

No single type is inherently highest quality. Each project, regardless of type, is verified against a defined baseline. Quality depends on how rigorously that specific baseline was set and how well the project meets other quality criteria. Removal credits from engineered sources have the most straightforward baseline (zero), and avoidance credits carry the most baseline uncertainty by design, but these are only one determinant of credit quality.

Do carbon removal credits automatically meet the ICVCM’s Core Carbon Principles? 

No. The ICVCM assesses methodologies and programs, not individual projects. If a project uses a methodology that is eligible for the CCP label, this can be a useful floor but is not a guarantee of high quality.

How does SBTi's near-term removal mandate change which credits I should buy now?

SBTi's finalized Corporate Net-Zero Standard V2.0 doesn't require removal purchases until 2035, but it sets the ramp now (i.e., 1% of scope 1, scope 2, and scope 3 emissions in 2035, scaling to 100% by the net-zero year). This means the highest-durability removal supply that is scarcest and most in demand today is the same supply that many companies will need later. The SBTi guidelines are still changing, so buyers and project developers must track them closely.

Key Takeaways

• The revenue stack for a given fuel is set by the rules that govern the market for low-carbon fuels: regulations, certification schemes, certificate registries, and corporate accounting frameworks. 
• Regulators and buyers reward characteristics beyond regulatory eligibility and carbon intensity, such as reportability, broader sustainability, and advanced technology.
• Relae helps producers with commercial strategy relating to feedstock, production pathway, and certification, which impact access to markets. 

The Route to Market Is a Strategic Choice

Low-carbon fuels (LCFs), such as sustainable aviation fuel (SAF) and renewable natural gas (RNG), will cost more to make than their fossil equivalents for the foreseeable future. Projects narrow that gap through some combination of regulatory-market value, sales of environmental attribute certificates (EACs) to voluntary buyers, and financial incentives such as the 45Z Clean Fuel Production Credit.

Regulatory programs are pulling investment into new facilities and novel production routes, and voluntary reporting frameworks are moving toward allowing companies to count fuel certificates in their emissions inventories. What the revenue stack for a given fuel looks like is set by the rules that govern the market for LCFs: regulations, certification schemes, certificate registries, and corporate accounting frameworks. 

In voluntary markets, the certification scheme, certificate registry, and reporting framework determine the official carbon intensity (CI) of the fuel, the number of certificates generated, and how buyers can use them to make claims. 

In regulatory programs across Europe and North America, the rules determine how the fuel is classified, and whether its feedstock receives premium value, is capped, or is excluded altogether. Producers who understand how their market entry decisions impact value will be better positioned now and going forward.

EACs Carry a Fuel’s Value to Market

An LCF EAC records characteristics of a batch of fuel separately from the fuel itself, such as whether it qualifies for a given program, the CI, or its feedstock. The certificate can travel with the fuel (bundled) or be sold on its own (unbundled): 

Bundled EACs

In most regulatory markets, an obligated party purchases the fuel and its certificate together. These buyers are mainly fuel suppliers, as under the California Low Carbon Fuel Standard (LCFS), and airlines, as under the EU Emissions Trading System and the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). They need both the physical fuel and the EAC that proves the fuel is eligible.

Unbundled EACs (Book-and-Claim) 

Often in the voluntary market, the fuel is consumed wherever it can be delivered. The EAC is sold separately to whoever wants to claim its attributes, a system called book-and-claim. This matters because most companies have no control over the fuel burned in their supply chains: a company that ships freight cannot choose the fuel its carriers use, but it can buy EACs with a certified CI and claim the associated emissions reduction.

In both markets, the characteristics the EAC carries determine the regulatory and voluntary value in a fuel’s revenue stack.

Three Layers of Rules Determine the Value of an EAC

An LCF producer chooses the feedstock, production pathway, and markets to sell into. How those choices translate to the value of a fuel’s EAC is determined by three layers of rules that govern the LCF market (Table 1).

Table 1. The three layers of rules that set an LCF EAC’s value. Examples are illustrative and not exhaustive. ISCC = International Sustainability and Carbon Certification; RSB = Roundtable on Sustainable Biomaterials; SAFc = sustainable aviation fuel certificate; RED III = Renewable Energy Directive; GHG = greenhouse gas; SABA = Sustainable Aviation Buyers Alliance. Source: Relae.

Where the Rules Disagree: Three Feedstock and Pathway Examples

The result is that the same batch of fuel can carry a different CI, or a different classification, depending on which rules it is subject to. Three examples below demonstrate how production pathway decisions can impact a fuel’s value:

1. Manure-based RNG ⇨ avoided emissions. The three layers treat avoided emissions differently. At the regulatory program and voluntary standard layer, ISCC PLUS follows the EU Renewable Energy Directive (RED III) in crediting methane emissions avoided through improved manure management, but CORSIA does not. At the registry and accounting layer, the Greenhouse Gas (GHG) Protocol’s draft Action and Market Instruments (AMI) Standard and the AIM Platform have proposed separating avoided emissions from a fuel’s direct life cycle emissions and reporting the two on different statements, and whether negative CI values from avoided emissions are accepted at all depends on the registry where the EACs are listed.
2. Crop-based feedstocks ⇨ indirect land use change (iLUC). Regulators don’t agree on how to incorporate iLUC, either. Under the LCFS, modeled iLUC emissions for all crop-based fuels are positive. Under CORSIA, they can be positive or negative. Under RED III, iLUC is excluded from the CI, though separate rules restrict feedstocks deemed high-risk for iLUC. And because modeling and assumptions keep evolving, iLUC values are also subject to change over time.
3. Synthetic fuel ⇨ e-SAF mandates. Regulatory programs also differ on what counts as a given category of fuel. ReFuelEU Aviation and the UK SAF Mandate both reserve a share of their mandates for e-SAF, but define it differently. The EU requires the fuel to qualify as a renewable fuel of non-biological origin (RFNBO). The UK sets its own power-to-liquid criteria, including which electricity sources it accepts. The same e-SAF can therefore count toward one sub-mandate and not the other.

Beyond Eligibility: EAC Characteristics the Market Rewards

In regulatory markets, an EAC’s value depends first on whether the fuel is eligible and how it is classified. In voluntary markets, value depends on the fuel’s CI and the number of certificates issued. Both regulators and voluntary buyers also reward characteristics beyond that baseline, and those characteristics can impact a fuel’s revenue stack:   

• Voluntary reportability. The value of an EAC depends on how a buyer can report it, today and in the future. The GHG Protocol is still finalizing its rules for fuel certificates and what a buyer can claim. Certificates that fit cleanly within those rules may command a premium.
• Breadth of sustainability criteria. Some buyers screen EACs against criteria beyond emissions savings. The Sustainable Aviation Buyers Alliance (SABA) explicitly prefers advanced feedstocks and certification schemes with stronger social and environmental safeguards. Regulations set a minimum bar, but voluntary markets have no single standard for a high-quality EAC. The Relae Criteria for High-Quality Low Carbon Fuels consolidate these characteristics into one framework, and can show producers how their fuel and certification choices measure up against it.
• Advanced feedstocks and technologies. Fuel from novel pathways typically costs more than fuel from established ones, and some buyers are willing to pay that premium: early buyers want to support technologies that need offtake to reach commercial scale, and others want to diversify supply ahead of expected constraints on hydroprocessed esters and fatty acids (HEFA) SAF.¹ Regulators reward the same pathways directly through e-SAF sub-mandates and financial incentives, such as the UK Revenue Certainty Mechanism. 

Where Should Producers Start?

How each program treats a feedstock, how each methodology calculates CI, and what each set of buyers will pay for are inputs to the feedstock, production pathway, and offtake decisions themselves. Once those decisions are made and contracts are signed, the route to market is largely fixed. Producers should weigh the routes open to them against three questions before committing:

1. How will my feedstock, production pathway, and certification affect access to markets?
2. How do I position my product within overlapping voluntary and regulatory markets?
3. Who are my buyers and what do they require or prefer?

A sound strategy must consider the complex interactions between voluntary and regulatory markets, certification schemes and registries, and buyer preferences.

The landscape continues to evolve, with new national certification programs and regulations for LCFs emerging across the globe and accounting frameworks shifting. The policy experts, scientists, engineers, and economists at Relae help producers understand how each certification route affects the value of their fuel in the markets they want to enter, choose feedstocks and pathways with that in mind, and make sure the claims behind their EACs are high-quality and hold up to buyer and registry scrutiny as the rules evolve.

Frequently Asked Questions

What is the difference between a bundled and an unbundled EAC?

A bundled EAC is sold with the physical fuel, usually to an obligated party under a regulatory program such as the LCFS or ReFuelEU Aviation. An unbundled EAC is sold separately from the fuel through book-and-claim, so a buyer can claim its attributes without taking delivery of or consuming the fuel.

What is the difference between a regulation, a certification scheme, a registry, and a corporate accounting framework?  

A regulation or voluntary standard sets the CI methodology and decides whether certain feedstocks are rewarded, capped, or excluded. A certification scheme verifies that a batch of fuel meets that methodology. A registry issues and tracks the certificates and can apply additional rules on CI, while corporate accounting frameworks determine what a voluntary buyer can claim.

Why can the same fuel have more than one carbon intensity?

Each regulatory program and voluntary standard sets its own CI methodology, and registries can add rules of their own. Manure-based RNG is one example: RED III and ISCC PLUS credit avoided methane emissions, CORSIA does not, and some registries cap CI at zero. The same batch can therefore carry different CIs depending on where it is certified and what market it is sold into.

How does carbon intensity affect LCFS credits?

Under the LCFS, the number of credits a fuel generates depends on how far its certified CI falls below the program’s fossil fuel benchmark for that year. Credit price is set by the market, so a lower CI increases the credits a producer has to sell, and the program’s rules decide the CI of the fuel.

Key Takeaways

• Decarbonizing steel is key to meeting ambitious climate targets in the face of rapidly expanding AI infrastructure as well as broader infrastructure growth.
• The gap between corporate climate ambitions and near-term commercial reality is widening. Despite strong demand signals from hyperscalers and other major buyers, leading producers have recently canceled or delayed flagship green steel projects, citing high energy costs, slow hydrogen market development, and unfavorable policy environments. 
• Bridging this gap requires significant capital investment and supporting mechanisms to scale low-carbon technologies. Environmental attribute certificates offer an effective mechanism to channel capital toward transformative, low-carbon steel projects, supporting technology scale-up, as well as providing a way for buyers to meet their emissions reduction targets.  
• To protect the credibility of environmental attribute certificates as a market mechanism for decarbonization, projects should seek to meet rigorous quality criteria such as additionality, verifiability, and catalytic impact.

Forging New Climate Ambitions for Steel Production

Decarbonizing steel production is essential to meet global climate targets. Steel production accounts for approximately 7–9% of global CO₂ emissions. This is driven chiefly by coal-based primary steelmaking, which still accounts for the majority of global production. Globally, at least 1.8 billion tonnes of crude steel were produced in 2025 to serve a broad array of industries including real estate, infrastructure, automotive, and data center construction. 

As hyperscalers race to build the infrastructure underpinning the AI revolution, steel demand for data center construction, and associated energy infrastructure, is increasing. While the relative share of data center demand for steel versus global steel demand is small, the need for approximately 20,000 tonnes of steel per data center has a material impact on hyperscaler’s public climate commitments. Microsoft, Meta, and other large technology companies have set ambitious 2030 climate targets that include their scope 3 emissions. The embodied carbon of the steel used to build their data centers sits squarely in scope 3.

Hyperscaler’s climate commitments have generated sector-specific demand for decarbonized steel, presenting an opportunity to affect steel decarbonization more broadly. Despite this demand, the supply of low-carbon steel remains limited. The industry faces significant scale-up challenges due to the diffuse nature of demand and the nascent market. Catalyzing growth in decarbonized steel production will require market innovations and new production pathways designed to overcome these challenges. Credible environmental attribute certificates can help bridge the gap between today’s market and tomorrow’s low-carbon steel sector.

What is an Environmental Attribute Certificate?

An environmental attribute certificate (EAC) represents the environmental attributes of a product that can be unbundled and transacted separately from the underlying physical commodity. The most widely used EACs today are renewable energy certificates (RECs), which track the environmental attributes of renewable electricity. The same concept can also be applied to steel and iron, as well as to materials such as cement and concrete.

In a book and claim model, a steel producer can implement a verified emissions reduction intervention, quantify the resulting lowered carbon intensity per tonne of steel produced, and convert that into tradeable certificates. Buyers can then purchase those certificates to support the deployment of low-carbon steelmaking capacity in cases where direct procurement of low-carbon steel is currently impractical due to geographic, contracting, or scheduling incompatibilities.

EACs are distinct from carbon credits. They do not represent emissions reduced or avoided relative to a counterfactual; they represent the intrinsic carbon intensity of the material produced, measured through a life cycle assessment. 

Decarbonizing Steel Requires Significant Capital and Infrastructure Deployment

Steel Production Today

Steel is currently made via three main production routes. About 71% of the world’s steel is produced through the blast furnace–basic oxygen furnace (BF-BOF) route, which emits an average of 2.33 tonnes of carbon dioxide (tCO₂) per tonne of crude steel. A further 24% is produced using scrap-based electric arc furnaces (EAFs), which emit 0.68 tCO₂ per tonne on average—far lower, but still dependent on the carbon intensity of grid electricity. The remaining roughly 5% uses direct reduced iron combined with an EAF (DRI-EAF), typically using natural gas, emitting 1.37 tCO₂ per tonne on average.

While increasing scrap-based production is a critical decarbonization lever, scrap availability is limited. Primary steel production, which uses iron ore as the main feedstock rather than recycled scrap, will remain necessary at large volumes through 2050. This makes it essential to decarbonize ore-based pathways, especially ironmaking: the step where iron ore is reduced to iron and where most emissions occur.

Decarbonizing ore-based steel production requires one of three fundamental interventions: (1) replacing coal and natural gas with low-carbon fuels such as hydrogen or bio-coke, (2) electrifying ironmaking directly, or (3) capturing and storing the CO₂ generated from fossil-fuel-based processes. All three involve significant capital expenditure and dependencies on infrastructure that is not yet in place at the necessary scale. As a result, the energy and cost challenge is substantial.

Low-Carbon Steel: Emerging Pathways

A range of transformative technological pathways are currently in development to overcome these barriers, offering the potential to deliver deep decarbonization to the steel industry exceeding 90% by 2050: 

• Hydrogen-based DRI-EAF: Using green hydrogen instead of natural gas within the DRI process provides a pathway to significantly lower the carbon intensity of ironmaking. Producers such as Stegra are deploying commercial-scale facilities designed to utilize 100% green hydrogen to reduce iron ore.
• Electrifying ironmaking: 
  
  • Molten oxide electrolysis: Boston Metal is commercializing a process that uses electricity to directly convert iron ore to molten metal through electrolysis at high temperature, eliminating the need for hydrogen or carbon reductants entirely.
  • Low-temperature electrowinning: Colorado-based startup Electra uses renewable electricity to extract iron from ore via an aqueous electrochemical process that operates at near-ambient temperature. 
• Carbon capture and storage (CCS): For blast furnaces and DRI plants with long remaining lifetimes, retrofitting with CCS technology can significantly reduce emissions. With new high-emitting capacity still being built, and assets expected to operate for decades, integrating CCS will be essential to avoid long-term carbon lock-in and to decarbonize these facilities over time. To date, commercial-scale deployment remains limited. The Al Reyadah facility at Emirates Steel is the only project currently capturing CO₂ from a DRI process at scale, though a handful of other large-scale projects have entered the development pipeline.

Progress and Setbacks: A Mixed Picture

The past year sent contradictory signals about the pace of steel decarbonization. On the demand side, technology companies with ambitious climate targets are actively signaling their intent to procure near-zero steel and support its development.

In September 2025, Microsoft and Stegra announced a landmark agreement that combines a physical supply deal for low-carbon steel with a separate EAC purchase agreement. Around the same time, Meta announced an agreement with Electra to purchase EACs tied to the startup’s clean iron production, becoming one of the first buyers to use the EAC model for an entirely novel, pre-commercial ironmaking technology. Nucor, the largest US steelmaker, also entered into a physical iron purchase agreement with Electra.

Despite these demand signals, the industry has experienced significant setbacks. A series of low-carbon steel project cancellations and delays has raised questions about the pace and viability of the steel transition, especially due to the high costs associated with green hydrogen production.

At present, the green premium for most low-carbon steel remains too high for buyers. A combination of sustained policy support, long-term demand signals from buyers willing to pay more, and scaling of supporting industries, such as green hydrogen production, is necessary for the low-carbon steel industry to be successful in the long run.

How EACs Can Bridge the Funding Gap in Steel

EACs unbundle low-carbon steel attributes from the physical material, reducing the friction between buyers who are willing to pay a green premium and geographic or logistical constraints that may inhibit physical offtake. Buyers, such as hyperscalers procuring conventional steel for data center construction in locations where low-carbon steel is not yet available, can purchase these certificates to support the development of low-carbon capacity, attribute lower-carbon production to their steel use via a market-based mechanism, and advance toward their scope 3 targets.

A primary objective of the Criteria for High-Quality Environmental Attribute Certificates in the Concrete and Steel Sectors, jointly developed by Relae (formerly Carbon Direct) and Microsoft, is to establish high-integrity standards for the EAC market in these sectors. For steel EACs, that means demonstrating significant emissions reduction performance by reaching at least Progress Level 2 in the ResponsibleSteel Decarbonization Progress Levels framework, and aiming to achieve Progress Level 3 by 2030. ResponsibleSteel’s scrap-variable benchmark provides a technology-neutral mechanism to evaluate emissions reduction performance by accounting for the specific proportion of scrap used.

EACs for steel are designed to be catalytic. Rather than supporting incremental improvements that are already becoming cost-competitive, they should target transformative capital changes, such as replacing BF-BOF routes with DRI-EAF, adopting low-carbon hydrogen in DRI processes, or deploying novel ironmaking technologies. Multi-year purchase agreements are particularly powerful because they provide the investment certainty that first-of-a-kind projects need to access capital at a lower cost.

What this Means for Buyers and Suppliers of Low-Carbon Steel 

Whether you are producing or procuring steel, EACs are only one part of a broader decarbonization strategy. For buyers with significant emissions from steel, and other building materials such as cement and concrete, EACs can be a powerful tool to help advance scope 3 reduction goals where supply for physical low-carbon materials is limited. Suppliers can complement commercialization strategies for low-carbon materials by using EACs to monetize emissions reductions, generate additional revenue to support decarbonization investments, and help scale markets for low-carbon materials. Navigating the steel market requires decisions at the intersection of technical feasibility, greenhouse gas accounting, and capital strategy. Key considerations include:

• Greenhouse gas accounting and reportability: Cradle-to-gate emissions for steel production must be tracked using life cycle assessments and should strive for interoperability with environmental product declarations (EPDs). EAC transactions must be reported transparently, especially given the absence of formal market standards at this stage.
• Additionality and catalytic impact: EAC purchases must demonstrably support projects that would not proceed without financial support from the EAC market mechanism, and projects should have a credible pathway toward the near-zero (Progress Level 4) threshold on the ResponsibleSteel framework.
• Avoiding double counting: EAC buyers must verify that the environmental attributes they purchase are not also being claimed by the physical product buyer via an EPD.

FAQs

What is an environmental attribute certificate (EAC) for steel?
An EAC represents the environmental attributes of low-carbon steel, unbundled from the physical material itself, so a producer can quantify a verified reduction in carbon intensity per tonne and sell that value as a separate, tradeable certificate. Buyers can purchase EACs to support low-carbon steel production while still working toward their own emissions targets.

How is an EAC different from a carbon credit?
An EAC reflects the intrinsic carbon intensity of the material itself, measured through a life cycle assessment. That's different from a carbon credit, which represents carbon dioxide actively avoided, reduced or removed from the atmosphere relative to a baseline.

How are AI data centers impacting the demand for low-carbon steel?

Data centers use roughly 20,000 tonnes of steel each, and as hyperscalers build out AI infrastructure, that steel use counts toward their scope 3 emissions and public climate targets. That's turned data center construction into a meaningful driver of demand for low-carbon steel, even though supply remains limited.

What makes an EAC credible enough to count toward a company's emissions goals?
A credible steel EAC needs to meet criteria like additionality (the project wouldn't happen without the EAC revenue), verifiability through life cycle assessment, and catalytic impact toward transformative technology rather than incremental gains. Relae (formerly Carbon Direct) and Microsoft jointly developed criteria for high-quality EACs in the steel and concrete sectors, which set a threshold of at least Progress Level 2 on the ResponsibleSteel Decarbonization framework today, rising to Progress Level 3 by 2030.

Can a producer sell an EAC and also get credit for the physical steel elsewhere?
No. EAC producers need to confirm the environmental attributes they're selling aren't also being claimed by whoever buys the physical steel through an environmental product declaration; otherwise the same emissions reduction gets counted twice.

Key Takeaways

• SAF and e-SAF mandates are reshaping the aviation fuel market. The EU and UK impose steep non-compliance penalties, turning regulatory requirements into a strategic lever for those who act early.
• Non-compliance is costly. Penalties run roughly 3 times the cost of compliance in the EU and from about 2 to 13 times in the UK, making long-term planning essential to mitigate risk.
• e-SAF producers have a unique opportunity. Mandates and penalties are shifting the economics of aviation fuel, making e-SAF more attractive despite historically high production costs.

How SAF Compliance Stacks Up

Airlines and fuel suppliers operating in Europe and the UK face growing economic uncertainty due to stringent mandates requiring the adoption of sustainable aviation fuels (SAF) with carve-outs for SAF produced from renewable hydrogen, also known as Power-to-Liquids (PtL) or e-SAF.¹ These mandates, aimed at reducing aviation emissions, carry steep penalties (up to 13 times the cost of compliance) for fuel suppliers who fail to meet required quotas. While this creates cost uncertainty for airlines and passengers, it opens a strategic opportunity for e-SAF producers. These producers are challenged by high production costs relative to other SAF on the market and a limited set of buyers that can afford the premium on a voluntary basis.

This piece explores the cost implications for aviation being shaped by these EU and UK SAF mandates and outlines how airlines and suppliers can respond strategically to minimize risk and maximize opportunities. By understanding these dynamics, industry stakeholders can turn regulatory compliance into a source of competitive advantage. 

Understanding SAF Mandates in the EU and UK

The EU Commission’s ReFuelEU Aviation regulation, part of the European Green Deal, sets binding targets for aviation sustainability. Beginning in 2025, ReFuelEU mandated that aviation fuel suppliers offer a minimum percentage of SAF and e-SAF at EU airports. By 2030, suppliers must blend at least 6% SAF, including 1.2% e-SAF. To discourage tankering practices (carrying excess fuel for return trips, increasing emissions), ReFuelEU Aviation requires airline operators to refuel at least 90% of their annual aviation fuel needs at a given EU airport before departure. 

In parallel, the UK Department for Transport (DfT) mandates a higher SAF blend of 10% by 2030 and places greater emphasis on reducing reliance on hydrogenated esters and fatty acids (HEFA) SAF fuels, which face eventual limitations on feedstock supply. HEFA’s allowable share will decline annually from 100% in 2025 to 42% in 2040. The UK also includes a sub-mandate specifically for PtL SAF.

The Real Cost of Falling Behind on SAF Mandates

The financial impact of these mandates is significant. Each year, the European Union Aviation Safety Agency (EASA) publishes regulatory reference prices for SAF, e-SAF, and conventional jet fuel (CJF) that anchor non-compliance penalties in the EU, most recently the 2025 Aviation Fuels Reference Prices for ReFuelEU Aviation. Using these reference prices for current-year costs and projected production costs or prices for SAF, e-SAF, and CJF from 2030–2050, the following analysis compares EU and UK compliance versus non-compliance penalties, converting all figures to US$/gallon.²

The price gap between SAF and fossil jet fuels remains wide. In 2025, SAF is approximately three times the price of CJF, while e-SAF is nearly twelve times more expensive. Projections indicate this price gap narrows by 2030, but far more for SAF than for e-SAF. The projected price of SAF in 2030 is US$5.46/gallon, more than double the estimated US$2.41/gallon for CJF. The price difference is even greater for e-SAF: with no traded e-SAF market yet, projected 2030 prices span US$5.70/gallon to US$33.00/gallon, with a central estimate around US$18/gallon, or roughly seven times the price of CJF.

Estimated Jet Fuel Prices 2025-2050 (US$/Gallon)

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Source: European Union Aviation Safety Agency. 2025 Aviation Fuels Reference Prices for ReFuelEU Aviation. (link); UK Department for Transport. SAF Mandate: Final-stage Cost Benefit Analysis. (link); EUROCONTROL. Aviation Outlook 2050: Main Report. (link)

The mandates carry strict penalties for non-compliance. Penalties for non-compliance in the EU are set at a minimum of two times the price difference between SAF and CJF per gallon of unmet obligation. Additionally, fuel suppliers must supply any unmet fuel obligations in subsequent reporting periods, which pushes the cost of non-compliance in the EU to three times the cost of compliance.

In the UK, penalties work differently: fuel suppliers must pay a fixed buy-out price per megajoule (MJ) of unmet obligation, which translates to US$24.64/gallon of unmet SAF obligation and US$26.08/gallon of unmet e-SAF obligation.³ Because the buy-out is fixed while compliance costs vary, UK penalties range from about 2 times the cost of compliance for e-SAF to 13 times for SAF in later years. The intent is clear: regulators are serious about pushing aviation towards sustainable fuels.

Cost-Comparison of Compliance vs Non-Compliance (US$/Gallon)

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Note: The cost of compliance under both mandates is calculated as the price premium of SAF/e-SAF over CJF per ton, using region-specific SAF prices: the EU SAF price reflects HEFA-based supply (ReFuelEU imposes no HEFA cap), while the UK SAF price is a weighted average of HEFA and higher-cost advanced pathways based on the UK's declining HEFA cap. The e-SAF (PtL) price is the same in both regions. 

Cost-Comparison of Complicance vs Non-Compliance (US$/Gallon)

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e-SAF Has a Policy-Driven Market Opportunity 

These price differentials present risk and opportunity. Airlines and fuel suppliers that fall short of compliance will face steep penalties. Those who comply strategically, can mitigate those risks and benefit from financial incentives that help offset higher fuel costs.

Incentive structures support SAF and e-SAF production. For example, the EU’s Emissions Trading System (ETS) has allocated allowances to offset SAF costs, especially for renewable fuels of non-biological origin (or e-SAF). Similarly, the UK offers tradable certificates and has now legislated a Revenue Certainty Mechanism (Sustainable Aviation Fuel Act 2026) that will guarantee SAF producers a set strike price through contracts-for-difference-style agreements, funded by a levy on fuel suppliers, with the first allocation round expected in 2027. The UK’s ETS also provides an indirect incentive as SAF use by airlines lowers compliance costs through reducing required allowances. 

Strategic Recommendations for Airlines and Suppliers

To navigate this shifting landscape, airlines and fuel suppliers must think strategically about procurement and compliance, potentially including:

• Proactive procurement: Airlines and fuel suppliers should prioritize securing long-term contracts with SAF and e-SAF producers. Early engagement can help ensure access to limited supply and stable pricing.
• Leverage incentive programs: Actively participate in available incentive schemes, such as the EU ETS and UK tradable certificates, to minimize compliance costs.
• Invest in e-SAF production: Consider strategic investments or partnerships in e-SAF production to align sustainability goals with regulatory requirements and financial incentives.
• Plan for volatility: Develop robust risk mitigation plans, using flexible procurement strategies and financial instruments to buffer against supply chain disruptions and price swings.

Turning Mandates into Market Momentum

As 2030 approaches, the pressure on airlines and fuel suppliers to comply with SAF mandates will intensify. Those who proactively respond to and embrace the mandates can transform regulatory requirements into strategic opportunities. Rather than viewing mandates as burdens, forward-looking stakeholders can use them to drive sustainable innovation and long-term resilience.

The EU and UK mandates for SAF and e-SAF represent an emerging shift in aviation fuel markets. Stakeholders that act now, by engaging with incentives and investing in sustainable fuel solutions, will emerge as industry leaders. Now is the time for airlines, fuel suppliers, and e-SAF producers to act decisively, transforming regulatory compliance from a costly obligation into a clear competitive advantage.

Frequently Asked Questions 

What happens if an airline or fuel supplier misses its SAF mandate quota?
Fuel suppliers—the obligated parties—pay a penalty on every unmet tonne: in the EU, twice the price gap between SAF and jet fuel, plus supplying the shortfall in a later period; in the UK, a fixed buy-out price (£0.137/MJ for SAF, £0.145/MJ for e-SAF). Combined, non-compliance runs roughly 3 times the cost of complying in the EU and from about 2 to 13 times in the UK.

What is e-SAF, and how is it different from other SAF?
e-SAF, also called Power-to-Liquid (PtL) fuel, is made from renewable or low-carbon electricity, hydrogen, and captured CO₂ rather than biomass feedstocks. It costs more to produce than conventional SAF today, but both the EU (from 2030) and UK (from 2028) mandates carve out a specific, growing sub-quota for it.

What is the UK's Revenue Certainty Mechanism?
It is a UK government scheme, modeled on the Contracts for Difference structure used in the power sector, that guarantees SAF producers a set strike price for up to 10 years, funded by a levy on aviation fuel suppliers. It became law through the Sustainable Aviation Fuel Act 2026, and the first contract allocation round is expected in 2027.

Is the EU considering changes to its SAF mandate timeline?
The EU has scheduled a formal review of ReFuelEU Aviation for 2027, following calls from airline groups to delay the 2030 e-SAF sub-target. No delay has been adopted, and the European Commission has said it remains "fully committed" to both the SAF and e-SAF mandates and that the 2027 review will evaluate the regulation rather than revise it.

Can corporate buyers still claim SAF benefits from fuel used to meet these mandates?
No, mandated volumes are claimed in the compliance market, so to avoid additionality concerns, voluntary corporate scope 3 claims (typically made through SAF certificates and book-and-claim) must come from supply beyond what the mandates require. As mandate demand grows, the pool available to voluntary buyers tightens, which is why early procurement locks in both supply and price.

Key Takeaways

• Sustainable aviation fuel (SAF) will not reach price parity with fossil jet fuel under any realistic near-term scenario. The cost premium is structural—rooted in the chemistry of feedstocks—not a temporary artifact of early-stage markets.
• Neither airlines nor corporate buyers are purchasing SAF for its energy content. Both are buying sustainability claims: airlines for regulatory compliance and scope 1 credentials, corporates for scope 3 emissions reporting and social license to operate. The fuel is incidental to both transactions.
• Corporate offtakes can play a genuine role in building the SAF industry, but only if they create capacity that would not otherwise exist. Additionality is not a technicality; it is the entire value proposition.
• High-integrity SAF procurement requires evaluating not just carbon reduction, but feedstock sourcing, leakage, and social and environmental harms. The newly released Criteria for High-Quality Low Carbon Fuels from Relae (formerly Carbon Direct) provides a framework for doing this rigorously.

A Major Deal Illustrates How the SAF Market Really Works 

On June 5, 2026, Google and American Airlines announced a three-year agreement under which Google will purchase sustainable aviation fuel (SAF) certificates (SAFc) associated with 35 million gallons of SAF. American will take physical delivery of the fuel at Chicago O'Hare. Google receives the emissions attributes. The arrangement relies on book-and-claim accounting, in which the physical fuel and the environmental attribute are legally separated and transferred to different parties.

The deal is a window into how the SAF market works, and what every company in the value chain needs to understand before entering it.

The SAF Cost Premium Is Structural, Not a Market Inefficiency

There is a persistent hope in the aviation industry that SAF will eventually reach price parity with fossil jet fuel. This will not happen, at least not through any mechanism that currently exists or is credibly in development.

The economics are the product of thermodynamics. Petroleum is pre-deoxygenated; over millions of years, heat and pressure stripped oxygen from biological material, concentrating energy into the hydrocarbons we pump out of the ground today. Bio-based SAF feedstocks, e.g., vegetable oils, agricultural residues, and other biomass, are oxygen-rich (carbohydrates, not hydrocarbons). Power-to-liquid e-fuels start from captured CO₂, which is fully oxidized. 

Either way, every SAF production pathway must pay an energy debt to remove or chemically reduce that oxygen, in the form of hydrogen deoxygenation, energy inputs, and processing costs. This is not a manufacturing inefficiency that scale will solve. It is a constraint baked into the feedstocks themselves.

The numbers reflect this. According to the European Union Aviation Safety Agency (EASA), the average market price of SAF in 2025 was approximately €1,925 per tonne, roughly three times the €640 per tonne average for conventional jet fuel. 

The cheapest pathway, hydroprocessed esters and fatty acids (HEFA), produced from waste oils like used cooking oil or tallow, represents almost all current SAF supply and sits at the lower end of the SAF cost range. Costlier cellulosic and e-fuel pathways push it higher. EASA estimates 2025 production costs for power-to-liquid e-fuels at €7,520 per tonne, more than ten times the cost of conventional kerosene. While these costs can and will come down, none are expected to approach price parity.

The feedstock ceiling compounds this. HEFA from waste oils is the cheapest SAF pathway, but waste oil supply is finite and competes with renewable diesel, which typically offers better margins for producers. As mandates push SAF volumes beyond what HEFA can supply, the industry must move to cellulosic biomass or power-to-liquid pathways, at progressively higher cost. Scaling the SAF industry does not automatically bring prices down. In the near term, it pushes them up.

Policy Determines Who Absorbs the Cost

If price parity is not coming, the cost premium lands somewhere. Two policy philosophies have emerged to answer that question.

Europe has largely adopted the polluter-pays principle: SAF mandates place the cost burden on fuel suppliers and, by extension, on airlines and their passengers. The EU's ReFuelEU Aviation regulation and the UK's SAF mandate both carry steep penalties for non-compliance. As Relae has documented, in the UK, those penalties range from three to 13 times the cost of compliance, depending on the obligation type and year, signaling that regulators are serious about pushing aviation toward sustainable fuels.

The United States approached the problem differently, leaning on taxpayer subsidies.The Inflation Reduction Act (IRA) 45Z Clean Fuel Production Credit and its predecessor, the 40B Sustainable Aviation Fuel Credit sought to socialize much of the cost premium. The appeal of this approach was that it made SAF economics viable without raising ticket prices. Its vulnerability was political: when the IRA's incentive landscape was revised, the project pipelines that had formed around those credits evaporated quickly. US taxpayer-funded support proved politically less durable than the UK and EU’s mandated compliance obligations.

Neither model works in isolation. Mandates without bankable project finance generate demand signals but no new supply. Incentives without policy durability attract project interest but cannot get facilities to final investment decisions. The deals that have actually moved capital combine a stable policy floor, whether mandate or incentive, with long-term private commitments that provide the revenue certainty project finance requires.

The Google-American Airlines deal illustrates the incentives-plus-private-commitment structure. The deal explicitly credits the Illinois SAF tax credit as the enabling policy lever. HEFA SAF of this type is eligible to generate Renewable Fuel Standard credits (RINs), and fuel produced from 2025 onward qualifies for the IRA's 45Z Clean Fuel Production Credit. This stack provides additional floor economics. The corporate offtake completes the structure by delivering the revenue certainty that volatile policy credits alone cannot. Remove any one of those elements and the deal's economics likely do not hold.

Nobody in this Market Is Buying SAF for its Energy Content

This is the key to understanding how the SAF market works. Neither airlines nor corporate buyers purchase SAF for its energy content. Airports have kerosene. Airlines do not need SAF to keep planes in the air. Corporate buyers, like Google, have minimal operational use for aviation fuel at all. While recent global disruptions in crude oil supply have highlighted SAF in the context of energy security, the industry as it exists today does not represent a realistic hedge against conventional fuel volatility.

What all parties are buying is the sustainability attribute attached to the fuel. For airlines, the relevant claim is a scope 1 emissions reduction: the right to report lower lifecycle carbon intensity for their flight operations. For corporate buyers, the relevant claim is a scope 3 reduction, a documented abatement of the emissions associated with their employees' business travel. Book-and-claim accounting makes this architecture explicit: it legally severs the physical fuel from the environmental attribute, allowing each to be transferred to the party that values it. The fuel is the delivery mechanism for the claim. 

This distinction matters for assessing the market. Airlines operate on among the lowest margins of any major industry. They cannot absorb the cost premium voluntarily without fundamentally compromising their finances. They participate in SAF markets when required to by mandate, or when a corporate partner subsidizes the premium by purchasing certificates downstream. The cost premium does not disappear; it shifts. Understanding where it lands is the starting point for any serious procurement decision. 

Corporate climate programs have finite budgets. SAF competes with renewable electricity procurement, fleet electrification, CO₂ removal, and supply chain decarbonization for the same dollars. Buyers who want their sustainability claims to match the actual sources of their emissions (rather than offsetting aviation with unrelated activities elsewhere) have a genuine reason to prefer SAF. 

A SAF Claim Is Only as Strong as the Quality Behind it

SAF buyers and sellers trade sustainability claims. The quality of those claims is the entire value proposition, and the reputational liability travels with them. The companies with the greatest willingness to pay for SAF certificates tend to be those with the most brand exposure: high-profile technology companies, professional services firms, and financial institutions. These are also the companies most likely to face scrutiny from regulators, NGOs, and investors if a claim does not hold up. Buying a certificate does not protect a company from that scrutiny. It transfers the liability along with the attribute.

That means a rigorous buyer needs to answer at least three distinct questions before relying on a SAF claim.

1. Does this fuel actually reduce lifecycle emissions? 

SAF's climate case rests on a carbon cycle argument: the feedstock absorbs CO₂ from the atmosphere as it grows, so when that carbon is released during combustion, the net addition to the atmosphere is theoretically near zero. But that logic holds only if upstream production is clean, and it often is not. 

Indirect land use change (when demand for a feedstock crop displaces food agriculture elsewhere, triggering clearing of forests or grasslands) can generate substantial emissions elsewhere in the global land and food system, eroding or eliminating the lifecycle benefit. Even waste-based feedstocks are not automatically clean: used cooking oil and tallow have existing market uses, and diverting them without careful accounting can displace those uses, alter commodity markets, and create emissions leakage elsewhere. 

2. Is the purchase additional? 

Additionality asks whether the procurement caused SAF to exist that otherwise would not have. This is a harder question than it appears, especially in markets where multiple policy support mechanisms are already active. For the Google-American Airlines deal, one critical variable for financial additionality—the SAFc price—has not been disclosed. If Illinois credits and federal RINs already cover most of the HEFA cost premium, then the question of what Google's purchase actually caused to happen is genuinely open. However, American Airlines has stated publicly that the long-term nature of the agreement enabled them to secure a new SAF offtake with Valero Marketing and Supply Company. The supply arrangement that may not have been bankable on the basis of volatile RIN markets and changeable policy alone. That is a real additionality argument. But it requires transparency to evaluate. The undisclosed SAF credit price is a current market liability, not just in this deal, but across the voluntary SAF market broadly.

Long-term offtakes do something that policy credits cannot: they provide stable, bankable revenue certainty. RIN prices fluctuate. Tax credits change with administrations. Neither can reliably anchor a final investment decision at the project level. A multi-year, creditworthy offtake agreement can. This is the distinctive and genuinely valuable role that corporate buyers play in this market: not paying the cost premium per gallon, but reducing the financial risk premium that keeps capital on the sidelines.

3. Is the full supply chain sound? 

Carbon claims are not the only dimension of sustainability that matters to a buyer's reputation. Companies making claims about their SAF procurement are implicitly making claims about their supply chains. That means labor practices, community impacts, Indigenous rights, feedstock sourcing integrity, and market leakage from displaced uses all fall within the scope of what a rigorous buyer should evaluate. A SAF supply chain that displaces food crops, harms a proximate community, or causes deforestation through indirect land use change creates a reputational problem that no certificate can fix.

What High-Integrity SAF Procurement Looks Like

The voluntary SAF market is still early, and the transparency it requires does not yet exist consistently. Relae recently released the Criteria for High-Quality Low Carbon Fuels, a comprehensive, publicly available framework designed to help close that gap. 

The criteria address six principles across the full supply chain: carbon accounting, additionality, feedstock sourcing, leakage, environmental harms, and social harms and environmental justice. They are designed as a practical reference for what a credible SAF claim requires, and where existing certifications may leave gaps that require additional diligence.

At the transaction level, five questions should have clear answers before any buyer signs an offtake:

1. Is the certificate linked to a specific project or supply agreement? 
2. Is that project financially dependent on the offtake, after accounting for all policy support already in the stack? 
3. Is the lifecycle emissions profile documented across the full well-to-wheel boundary, including indirect effects? 
4. Are the feedstock sourcing and supply chain risks assessed and disclosed? 
5. Has the producer evaluated leakage and community impacts?

The Google-American Airlines deal demonstrates what serious voluntary SAF procurement can look like. The Criteria for High-Quality Low Carbon Fuels provides the framework buyers need to evaluate deals like this one rigorously.