Understandably, the airline industry likes to highlight its efforts to become more sustainable.

The International Air Transport Association (IATA) committed to the 2050 net zero target a year before the International Civil Aviation Organization (ICAO) did. In particular, the industry will have spent $500 million extra on sustainable aviation fuels (SAF) in 2023, an amount expected to increase to $2.4 billion in 2024.

But IATA Chief Economist and head of sustainability Marie Owens Thomsen used the opportunity at the association’s annual media day in Geneva to issue a stark warning: “The glass is more empty than full.”

Owens Thomsen was referring to the level of investment going into building up production capacity for SAF that is not meeting expectations. Owens Thomsen criticized investors that are still preferring traditional oil and gas companies because profits are much higher. “The investment proposition has to be attractive,” she said. “ESG [environmental social governance] ratings only intervene at the margins.” In other words: many people talk about the need to invest in sustainable technologies in aviation, but so far not enough is actually being committed.

SAF is obviously at the core of the sector’s environmental transformation so success is a must. But the case also shows to what extent the airline industry is dependent on others to achieve its targets as it does not have the financial means to fund the kick-starting of the SAF sector on its own. That is also true in other areas—aircraft manufacturers not delivering aircraft on time, airports and governments coming up with ideas to limit flight operations and introduce punitive measures to curb the sector’s environmental impact.

In 2022, 0.24 million tons of SAF were produced globally, according to IATA. The association expects that to have doubled to 0.5 million in 2023. But IATA Director for net zero transition Hemant Mistry made clear that “we were expecting significantly greater output” of SAF for 2023. In 2024, IATA hopes fuel producers will make available 1.5 million tons. At the same time, the number of oil wells has increased by 6% this year at an expected GDP growth of 3%. “This does not make sense,” Owens Thomsen said.

While the tripling of SAF production within one year looks promising, the requirement is much larger. IATA estimates that the industry will need 500 million tons of SAF in 2050, 1,000 times the volume produced in 2023. To meet the recently established target of a 5% reduction in CO2 emissions by 2030, formulated by ICAO’s Third Conference on Aviation and Alternative Fuels (CAAF/3), around 14 million tons of SAF will have to be available in 2030, essentially 10 times the amount targeted for 2024.

There is no shortage of projects announced. According to Mistry, 10.3 million tons could be produced based on incentivizing policies, programs such as the U.S. Inflation Reduction Act, which has been warmly received by the airline industry. An additional 6.7 million tons are identified through mandates. Airlines have committed to buying around 13 million tons by 2030 when all of their voluntary pick-up agreements are added up. There is a lot of overlap between the various categories, but they show that SAF demand is there.

What is also worrying currently is that only 3% of total renewable fuel production is SAF. For the CAAF/3 vision it needs to be in the area of 25-30% by 2030, but many governments globally still weigh what industry sectors should get preferred access.

The key question is whether there will be enough production, and so far, the outlook cannot be positive. As Owens Thomsen pointed out, oil and gas producers are investing only 3% of their revenues into renewable energy. Why? As Owens Thomsen mentions, the picture will likely only change once investment in alternative energies becomes at least as attractive as in fossil fuels.

Another conference, COP28 currently being held in Dubai, could define a more definitive policy framework to tilt investment decisions in favor of renewable energy. But as the first days of COP28 have shown, the clash of economic and environmental interests continues and has yet to play out. For aviation in particular, that is bad news.