Aviation: Alternative Fuels
The question
To ask the Secretary of State for Transport, with reference to Clauses 6, 12 and 13 of the Sustainable Aviation Fuel Bill, what estimate she has made of the total cost to (a) passengers, (b) taxpayers, and (c) fuel suppliers arising from revenue certainty contracts and associated levy payments; and what steps she is taking to ensure that this support does not (i) create long-term subsidy dependence and (ii) disproportionately benefit overseas producers.
Answered by Keir Mather
The Government set out the potential costs and benefits arising from the RCM scheme in the Cost-Benefit Analysis, published in May 2025, including potential costs for passengers and fuel suppliers. The scheme will be funded via a variable levy placed on aviation fuel suppliers, not by the taxpayer.
The RCM contracts will only be signed with UK-based SAF producers. These contracts will have a defined term length to ensure a clear end date to the subsidy and also sets a cap on the support for the sales of SAF to control the scale of the scheme. In addition, clause 1 (7) of the SAF Bill provides an end date, 10 years from the day on which the Act is passed, to new contracts being entered into.
We expect UK SAF production to be internationally competitive, with the RCM playing a key role to attracting investment for UK producers in a nascent market that is using innovative technologies. Whilst we are designing contracts, there is careful consideration towards how the volumes are sold under the RCM, including who are the offtakers and the end user’s location.
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