Zhong Guo Hua Gong Bao·2025-12-30 07:38Core Insights - The SAF production facility in Lianyungang, supported by Honeywell and Jiaao Environmental, has achieved large-scale production, processing 10,000 barrels daily, equating to an annual capacity of approximately 500,000 tons, marking a significant step towards commercial operation in China's SAF industry [1] - The project is seen as a pivotal element in the intersection of policy and market opportunities, reshaping China's green aviation energy landscape and positioning "Made in China" within the global green energy supply chain [1] Market Dynamics - The global aviation industry faces unprecedented carbon reduction pressures, with SAF being the most viable decarbonization pathway, potentially reducing lifecycle carbon emissions by up to 80% compared to traditional jet fuel [2] - In Europe, the demand for SAF is expected to surge due to regulatory drivers, with a projected consumption of 1.9 million tons by 2025, while domestic production capacity is only around 1 million tons, leading to a significant supply gap [2] - The International Air Transport Association forecasts that global SAF production could reach 2 million tons by 2025, representing only 0.7% of total fuel consumption, indicating substantial market potential [2] - The limited supply of SAF in the U.S. due to trade policies is shifting global buyers' focus towards Asia-Pacific production capabilities, presenting historic opportunities for Chinese SAF exports [2] Domestic Support and Infrastructure - China is establishing a comprehensive support system for the SAF industry, with top-level design and legal frameworks such as the Energy Law and Renewable Energy Law laying the groundwork for bio-liquid fuel development [3] - The People's Bank of China and other departments have included SAF in the 2025 Green Finance Support Project Directory, facilitating access to green loans and bonds to alleviate financing challenges [3] - Local governments are actively building industrial ecosystems, exemplified by Chengdu's establishment of a dedicated SAF industrial park and the introduction of supportive policies with over 100 million yuan investment planned over three years [3] Industry Growth Projections - The combination of policy and market forces is propelling the Chinese SAF industry into a rapid growth phase, with predictions of nearly tenfold market growth over the next five years, potentially reaching a market size in the trillions [4] Strategic Collaborations - The partnership between Honeywell and Jiaao Environmental aims to create a complete commercial loop from technology to product, utilizing Honeywell's Ecofining technology to efficiently convert waste oils into high-quality SAF [5] - Jiaao Environmental has established itself as a leader in SAF production with a designed capacity of 372,400 tons per year, leveraging its expertise in biomass energy [5] Market Expansion and Achievements - Jiaao Environmental has made significant strides in 2025, obtaining necessary approvals for domestic sales and becoming the first company on China's bio-jet fuel export list, exporting approximately 13,400 tons to Rotterdam [6] - Strategic investments from major players like BP and China National Aviation Fuel have solidified Jiaao's market position and distribution channels [6] Future Directions - The focus for the SAF industry will be on continuous cost reduction, with efforts to narrow the cost gap with traditional jet fuel through technological advancements and financial support [7] - Diversification of raw materials is essential to mitigate supply risks, with potential future developments in utilizing agricultural waste and synthetic fuels from green hydrogen and carbon dioxide [7] - Companies may explore advanced SAF production technologies and integrate carbon capture and utilization to develop "negative carbon" fuels as a future direction [7]