The global aviation industry is confronting a widening mismatch between demand for sustainable aviation fuels and the availability of certified supply, according to discussions held during the final day of ICAO Aviation Climate Week.
The event focused on strengthening the contribution of ICAO’s Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), which the organisation identifies as a key mechanism for supporting international aviation’s carbon-neutral growth ambitions. Speakers warned that while investment and policy support are accelerating, fuel production and regulatory approvals are struggling to keep pace with industry requirements.
According to reporting from Airline Routes & Ground Services, delegates highlighted growing concerns over the limited availability of CORSIA-certified Sustainable Aviation Fuels (SAF), Lower Carbon Aviation Fuels (LCAF) and eligible emissions units at a time when airlines face increasing pressure to decarbonise operations.
Participants at the conference noted that demand for sustainable fuels and carbon offsetting mechanisms is rising alongside increased airline activity and fresh investment across the aviation value chain.
However, speakers said significant supply constraints remain.
Key challenges identified during the discussions included:
• Limited global production capacity for SAF and LCAF
• Insufficient availability of CORSIA-eligible emissions units
• Lengthy regulatory approval processes
• Supply chain bottlenecks affecting market expansion
• Growing demand from airlines seeking compliance with climate commitments
Delegates stated that billions of dollars in financing are now being directed towards sustainable aviation projects, creating momentum for innovation and market development. Despite this progress, they cautioned that current production levels remain inadequate to satisfy anticipated demand.
The discussions underscored that without a substantial increase in certified fuel output and offset availability, aviation's decarbonisation pathway could face significant pressure over the coming years.
A major focus of the event centred on practical examples from ICAO Member States that have already implemented CORSIA-related systems.
Representatives presented examples of national programmes designed to improve monitoring, reporting and verification of carbon dioxide emissions. One case involved a nationwide digital platform that supports emissions monitoring and verification activities, while another demonstrated a collaborative implementation model involving multiple stakeholders.
Panellists also highlighted increasing cooperation between countries on emissions verification and accreditation processes.
The discussions pointed to emerging efforts to align verification methodologies across jurisdictions, allowing systems recognised in one country to be accepted by others. According to speakers, such harmonisation could reduce compliance complexity for airlines operating across multiple markets.
Participants further highlighted the growing role of recognised certifiers and accreditation bodies in supporting implementation and ensuring consistency across international markets.
As more countries prepare to strengthen CORSIA implementation, speakers identified technical support and knowledge-sharing initiatives as critical requirements.
Areas highlighted for future capacity-building efforts included:
• Practical reporting templates and guidance documents
• Regional training programmes
• Expert networks for verification and accreditation
• Simplified documentation processes
• Knowledge-sharing based on successful case studies
Delegates also stressed the importance of continued cooperation between ICAO, the United Nations Framework Convention on Climate Change (UNFCCC) and national authorities to support the evolution of global aviation climate frameworks.
According to participants, making compliance processes easier to understand and implement will be particularly important for newer entrants and developing markets.
Beyond fuel supply challenges, speakers also examined the impact of national and regional aviation taxes introduced alongside CORSIA.
Panellists stated that additional aviation climate taxes risk creating regulatory complexity and policy fragmentation, potentially increasing costs for both airlines and regulators.
They emphasised that CORSIA was developed as a single internationally agreed framework for aviation carbon offsetting and warned that overlapping tax regimes could duplicate existing measures.
Participants also noted that revenues generated from aviation-related environmental taxes are often directed towards general government budgets rather than aviation emissions reduction programmes.
Speakers highlighted examples where aviation green taxes were subsequently reduced or withdrawn after failing to deliver the intended environmental outcomes.
The issue was described as particularly significant for developing countries and Small Island Developing States, where aviation connectivity remains essential for economic resilience and social development.
The conference also examined financing challenges associated with aviation decarbonisation.
Delegates reviewed the role of ICAO’s Finvest platform, which aims to connect project developers, airlines, investors and policymakers involved in sustainable aviation initiatives.
According to discussions at the event, Finvest does not provide funding directly. Instead, it focuses on creating a transparent pipeline of investment-ready projects, facilitating partnerships and improving access to information for potential investors.
Speakers identified several barriers that continue to restrict investment flows into sustainable aviation projects:
• Limited availability of long-term offtake agreements
• Regulatory and policy uncertainty
• Early-stage funding gaps
• Perceived investment risks in emerging markets
• Challenges in demonstrating project bankability
Participants said Finvest can help address these obstacles by promoting recognised certification frameworks, supporting pre-investment technical assistance and improving visibility for viable projects seeking capital.
The discussions concluded with a clear message that aviation's climate ambitions will depend on significantly expanding the supply of sustainable fuels, emissions units and investment-ready projects.
While regulatory alignment, financing initiatives and international cooperation are progressing, speakers stressed that supply growth must accelerate if the industry is to meet rising demand under CORSIA.
As airlines continue to pursue decarbonisation goals and governments strengthen climate commitments, the availability of certified sustainable fuels and carbon offsetting solutions is likely to remain one of the sector's most pressing challenges.
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