Making Jet Fuel Pay for the Future of Clean Flying
The Hague, Saturday, 31 October 2026.
With clean aviation fuels costing up to six times more than conventional kerosene, economists urge using jet fuel taxes rather than state bailouts to fund the green transition.
Market Realities and the Cost Penalty of Sustainable Flight
The push to decarbonize commercial aviation is running into a severe pricing imbalance as of late October 2026 [1]. Conventional fossil kerosene continues to enjoy an artificial price advantage on international routes due to a persistent lack of standard excise duties, making clean alternatives economically uncompetitive [1]. Current market benchmarks show that bio-based sustainable aviation fuel (bio-SAF) remains two to three times more expensive than fossil jet fuel, while synthetic e-SAF commands an even steeper premium, costing between three and six times as much [1]. Furthermore, feedstocks for bio-SAF derived from used cooking oil and agricultural waste streams are insufficient to meet projected long-term demand, while synthetic e-SAF faces severe production deficits and prohibitive capital expenditure requirements due to an almost complete absence of large-scale manufacturing facilities [1].
The Structural Impasse Between Airlines and Fuel Producers
This stark economic divide has triggered a structural market failure across the aviation supply chain [1]. Financial analysis from ING Bank highlights that SAF refiners require firm 10- to 15-year purchase commitments before they can secure financing to build commercial plants, whereas commercial airlines remain unwilling to lock themselves into expensive, long-term contracts in a volatile operating environment [1]. To overcome this paralysis, both carrier KLM and ING Bank have released position papers urging the Dutch government in The Hague to step into the breach [1]. Their proposals call for state-backed contracts for difference, price floor guarantees, direct risk sharing for green production facilities, and an initiative where the Ministry of Defence (Defensie) acts as an anchor public customer for clean aviation fuels [1]. Additionally, KLM has advocated creating a dedicated SAF fund using revenues generated from the European Union Emissions Trading System (EU ETS) to cover the price spread between fossil jet fuel and clean alternatives, alongside support tailored for synthetic e-SAF [1].
Mounting Airport Charges and Competitive Strains
The calls for public underwriting come as Dutch carriers grapple with severe cumulative cost increases across domestic operations [2]. Data from the annual Benchmark Airport Charges and Government Levies conducted by SEO Amsterdam Economics (SEO Economisch Onderzoek) for the Ministry of Infrastructure and Water Management reveals that overall aviation fees at Amsterdam Airport Schiphol have surged by 193% since 2019 [2]. Operational levies—comprising passenger service fees, landing charges, and security costs—accounted for approximately 60% of that total increase [2]. Meanwhile, the implementation and subsequent hikes of the Dutch national aviation tax accounted for roughly 35% of the run-up, with emissions, noise, and air traffic management surcharges making up the remaining 5% of the cost rise [2].
Policy Showdowns and the Fiscal Horizon in The Hague
These compounding expenses have pushed Amsterdam Airport Schiphol to become the second most expensive airport among those benchmarked across Europe, surpassed only by London Heathrow [2]. Transavia executive Paul Terstegge warned that these escalating charges jeopardize operational viability and passenger affordability across the Netherlands, especially as domestic airlines attempt to strengthen structural balance sheets [2]. However, instead of extending general treasury subsidies or absorbing commercial fuel risks, environmental policy specialists argue that taxing untaxed fossil kerosene provides a self-sustaining funding mechanism to underwrite green transition innovation [1]. Lawmakers in the Dutch House of Representatives (Tweede Kamer) are scheduled to review these conflicting perspectives during a SAF roundtable on 4 November 2026, though earlier committee schedules had an unresolved planning check [1][alert! ‘roundtable planning status had a deadlined review recorded prior to 31 October 2026’], as upcoming legal actions challenging the Dutch Airport Traffic Decree (Luchthavenverkeersbesluit) continue to loom over future airport capacity [1][alert! ‘specific filing date and legal status of Luchthavenverkeersbesluit challenge are unconfirmed in source’].