// Project
IðunnH2 is developing the facility five kilometres from Keflavík International Airport: 300 MW of power for 70,000 tonnes of synthetic jet fuel a year, with production slated to start in 2029.
// Facility
The state-of-the-art facility will use sustainably sourced, local inputs to create synthetic jet fuel for use at Keflavík Airport. Electrolysis, methanol synthesis, fuel conversion, and blending all take place at the same facility, with no intermediate transport and no external refinery. The inputs are Icelandic: renewable electricity, captured CO₂, and water. The production process is a series of individually proven technologies that have never been integrated at this scale, developed in collaboration with Nel, Haffner Energy, and our neighbours Carbon Recycling International, with inputs from Honeywell UOP.
// Power
A 300 MW facility will be a major new electricity user, so how it draws its power matters. The project will buy new, contracted renewable power at full market price, and will reach a final decision only once that supply is secured, so nothing is taken from homes or existing industry.
Because electrolysis is one of the few large loads that can genuinely be curtailed in seconds without damage, the plant will be able to hand most of its demand back to the grid in an emergency, serving as a demand-side reserve for homes, hospitals and critical infrastructure in Suðurnes.
The honest part of the bargain: new demand means new generation, on the public record about 100 new wind turbines across two or three sites. The project’s long-term contracts are what let energy companies finance that buildout, and the turbines will stand where they can be seen. Fuel made at home, in exchange for new power built at home. We believe that trade serves Iceland, and it is Iceland’s to judge.
// Offtake
ReFuelEU Aviation mandates rising SAF blending at EU airports, from 2% in 2025 to 70% by 20501, with a dedicated sub-mandate for synthetic fuels like eSAF. EEA incorporation is pending. Two airlines committed to eSAF from the Iceland eSAF Project.
Committed offtake under MoU against the project’s 70,000 t/yr nameplate capacity.
Icelandair, 45,000 tonnes per year, MoU signed 2022. In 2022, three years before the first ReFuelEU blending obligation took effect, Icelandair signed a memorandum of understanding with IðunnH2 for up to 45,000 tonnes of eSAF per year from 2029 onwards.
// Quote
“Entering into this memorandum of understanding demonstrates we want to support pioneers working on the development of sustainable aviation fuels in Iceland.
Bogi Nils Bogason
CEO of Icelandair, MoU announcement, 2022
Luxaviation, 10,000 tonnes per year, 15-year MoU, signed 2025. In July 2025, Luxaviation signed a memorandum of understanding with IðunnH2 for up to 10,000 tonnes of RFNBO-compliant eSAF per year, beginning in 2029.
// Quote
“Today's agreement with IdunnH2 not only accelerates our SAF ambitions, it also pays tribute to the longstanding aviation bond between our two countries.
Patrick Hansen
CEO of Luxaviation Group, MoU announcement, 2025
// Site
The facility will be located in Kadeco’s Green Industrial Park in Suðurnesjabær, five kilometres from Keflavík International Airport. The park has industrial-grade port access, established heavy-industry infrastructure, and an existing connection to Iceland’s national grid. The fuel produced here will be blended onsite and delivered into the KEF hydrant system without relying on vulnerable long-distance supply routes.
ReFuelEU mandates a blend of SAF in all jet fuel at every EU/EEA airport, a share that climbs each year. Measured against the national energy forecast for jet fuel demand, the Iceland eSAF Project’s full output would cover the total SAF mandate only until around 2035, and the dedicated eSAF sub-mandate until around 20452. SAF can be blended up to 50% with conventional fossil jet fuel under current aviation safety standards.
Mandate's effect at KEF
ReFuelEU mandate as a share of Iceland's forecasted jet fuel demand, against planned production.
Jet fuel import dependence
Every litre of Iceland's jet fuel is imported today. The Iceland eSAF Project starts to change that from 2030.
SourceStatistics Iceland
// Site
This is a local project before it is a national one. Suðurnes accounts for close to half of all the fuel sold in Iceland: the jet fuel uplifted at Keflavík, plus the peninsula’s own road and marine use, which ought to make this small corner of the country central to national planning for the energy transition and energy independence. The plant will be located in Kadeco’s Green Industrial Park in Suðurnesjabær, with harbour access and a professional framework around the services it needs, and it will share what it makes: the project’s goal is to direct excess heat into HS Veitur’s utility system, adding a new heating source for residents in the area, and the oxygen produced as a by-product of electrolysis could supply other businesses.
The municipalities are involved, not bystanders. The project’s stakeholder group has been at the table since 2022, with representatives from both municipalities, Kadeco, Icelandair, Icelandic Tank Storage and Isavia, and IðunnH2 holds signed MoUs with Icelandic Tank Storage, Kadeco, Suðurnesjabær, Reykjanesbær and Icelandair. Local jobs, local procurement, and an industry whose value stays in Suðurnes.
// Development path
Securing renewable power, captured CO₂, technology partners, and binding offtake, and then sequencing them into one bankable project, is an undertaking measured in years. Every input and every stage of the production process come with project-specific design considerations that must be solved with specialised partners. The timeline below sets out how ours unfolds.
// Climate impact
The direct climate impact of the Iceland eSAF Project is significant. At full operation, the facility will prevent approximately 220,000 tonnes of CO₂ per year, about midway between the annual emissions of the Rio Tinto ISAL aluminium smelter and Elkem’s ferrosilicon plant at Grundartangi. In everyday terms, that is roughly the same as taking about 100,000 cars off the road each year, based on an average Icelandic passenger car emitting about 2.2 tonnes of CO₂ a year. It will also produce about 1,300 tonnes of green diesel per annum as a co-product, displacing fossil fuel in ground transport.
// Impact
// Road ahead
Aviation will not decarbonise while waiting decades for a new kind of aircraft. The planes flying today, and the planes that will be flying in 2045, run on liquid hydrocarbon fuel. If that fuel continues to come from crude oil, aviation’s contribution to climate change will keep growing. The only way to change the trajectory is to change what goes into the tank.
That is an industrial problem, not a theoretical one. It requires real facilities, built in real places, by people willing to commit capital and years of work to something that has never been done at this scale. The Iceland eSAF Project is one of those facilities. It will not solve the problem alone, but it is part of the generation of projects that proves it can be solved, and in doing so, makes the next generation faster, less expensive, and less risky to build.
The road from first-of-a-kind to established industry is long. It will never be laid unless someone starts.
