Quantifying the Cost of Compliance: A Sensitivity Analysis of SAF Mandates and Penalties in the EU Aviation Market
Founder
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Invest Through Flying
EU airlines want to delay SAF mandates — but our latest analysis shows that doing so would cost them more, not less.
Last week [at time of writing, April 2025], several major European carriers (Air France-KLM, Lufthansa Group, International Airlines Group (IAG) and Ryanair) called on the European Commission to slow the rollout of sustainable aviation fuel mandates, citing cost concerns. The EU responded with a firm no. And for good reason.
Quantifying the Cost of Compliance models SAF adoption, EU ETS exposure, and mandate penalties from 2025 to 2035. It compares four SAF compliance strategies across three ETS and SAF pricing trajectories.
What it shows is simple but surprising:
💡 The cost of inaction is higher than the cost of investing in SAF.
Why? Because the EU ETS is now the dominant fuel cost driver. By 2035, airlines that fail to comply will be paying more for carbon than they ever paid for kerosene. Even expensive SAF is cheaper than the ETS + penalties airlines face by staying fossil-reliant.
👉 In the high-case scenario, doing nothing pushes fuel cost to over €2,400/t.
👉 Full compliance with scaled SAF cuts that by €800/t — even before counting climate benefits.
In the updated addendum, the 2024 SAF and Jet A price benchmarks from the EASA are integrated, making the case for SAF compliance is even stronger.
Key findings:
By 2035, full non-compliance could push airline fuel costs to over €3,434/t, driven largely by ETS costs and mandate penalties.
Full SAF compliance (with projected learning-curve cost reductions) lowers total fuel costs to €1,760/t — a €1,670/t saving compared to inaction.
Even at EASA’s conservative SAF price estimates, blending SAF is cheaper than absorbing full ETS and penalty exposure.
The latest results confirm:
✈️ ETS exposure is now the single largest cost risk for airlines.
✈️ SAF acts as a hedge — not just a cost.
✈️ Delaying SAF adoption is more expensive than investing early.
Would you like to learn more about this topic? Dana offers workshops explaining the report and tailored model implementation for organisations, as well climate advisory services for hard-to-abate sectors.