Part of the EU’s Clean Industrial Deal (CID), STIP is expected to unlock investment so aviation and shipping can switch from fossil fuels to low-carbon fuels, such as hydrogen or ammonia, to meet 2035 targets under the ReFuelEU Aviation and FuelEU Maritime regulations.
To meet these regulations, around 20 million tonnes of sustainable alternative fuels, including 13.2 million tonnes of biofuels and 6.8 million tonnes of e-fuels, will be required according to the European Commission.
The bloc estimates that a total investment of around €100bn ($113bn) by 2035 will be needed, mostly from private industry.
To de-risk early projects and attract that private capital, the Commission has committed to mobilising over €2.9bn in EU funding by 2027. Notably, €2bn ($2.26bn) is earmarked for sustainable aviation and maritime fuels through InvestEU.
A further €446m ($505m) will be made available under the Innovation Fund for the first wave of synthetic aviation (eSAF) and maritime fuel projects.
The EU also highlighted the €300m ($339m) European Hydrogen Bank (EHB) auction, which is dedicated to hydrogen-based fuels for aviation and shipping. The auction is set to open in early December 2025 and has already exceeded its €1.2bn ($1.36bn) budget available through the Innovation Fund.
Additionally, the Commission plans to support research and innovation projects with around €133m ($150m) under Horizon Europe.
Alongside these funding streams, pilot pooled double-sided auctions for eSAF in 2026 are also planned, mobilising at least €500m ($565m) under the Early Movers Alliance scheme.
They then aim to develop an EU-wide intermediary mechanism linking fuel producers and buyers to provide revenue certainty.
Brussels is assessing a range of market-based tools to accelerate deployment, including tradeable SAF and maritime fuel certificates, book-and-claim options, and the extension of power purchase agreements (PPAs) to renewable and low-carbon fuels.
The Commission is also considering broadening the EU Emissions Trading Scheme (ETS) support for SAF, and introducing similar incentives for EU-produced maritime fuels. It said this could strengthen demand while keeping investment within the bloc.
Apostolos Tzitzikostas, Commissioner for Sustainable Transport and Tourism, called STIP “a decisive step towards a sustainable future.”
Tzitzikostas added, “This plan shows the Commission’s firm commitment to scaling up renewable and low-carbon fuels in aviation and waterborne transport.
“Success will depend on close cooperation among Member States, industry, financiers and civil society to turn this challenge into a strategic opportunity for Europe.”