Global Aviation Sustainability Outlook 2026

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China In October 2025, China’s National Development and Reform Commission (NDRC) introduced an up- to-20% capital expenditure subsidy for clean fuels produced using SAF pathways, ammonia, methanol and carbon capture utilization and storage (CCUS). The subsidy’s aim is to unlock local green hydrogen production, with experts predicting potential savings of 5-8% in final fuel costs.76 In the first half of 2026, stakeholders expect China to announce plans for a SAF mandate for domestic flights, which could see rapid growth of the domestic SAF industry and further exacerbate the global trade in used cooking oil. Combined with the announcement of new export permits for a record 1.2 million tonnes of SAF,77 China is gearing up to become a leading SAF export market, complementing its already thriving export-orientated fuel feedstock market and supporting the development of its domestic biofuel industry. Singapore In Singapore, the government has set a 1% SAF target for 2026, with the goal to raise this target to 3-5% by 2030. To tackle price volatility in the nascent SAF market, a levy will be implemented from October 2026 to pay for centralized procurement of SAF, aggregate demand and provide cost certainty to air transport users. The collected levy will be used to procure the SAF needed to meet the 1% target; companies will be able to use this central procurement platform for voluntary SAF purchases too. The levy is calculated on an origin-destination basis. For instance, economy class passengers will pay S$1.00, S$2.80, S$6.40 and S$10.40 to Bangkok, Tokyo, London and New York respectively. A new body, SAFCo, has also been set up to collect the levy on behalf of the government.78 Australia Similar to the US incentive approach, the Australian government committed to a AU$1.1 billion low- carbon liquid fuels production incentive through its Cleaner Fuels Program, announced in September 2025. The programme will cover clean fuels used in hard-to-abate industries, such as aviation, heavy freight and mining; for example, it will offer grants to domestic producers, including AU$33.5 million under the Sustainable Aviation Fuel Funding initiative. The scheme is expected to be finalized in early 2026, with applications opening mid-2026.79 Japan In April 2025, Japan saw its first commercial SAF plant commence operations, with several other projects in the pipeline. Japan’s approach to SAF policy combines fiscal support measures and regulatory policies. The government is offering capital investment support for large-scale SAF facilities under initiatives such as GX Economic Transition Bonds and tax credits for domestic SAF production. On the regulatory side, Japan has set a 10% SAF target by 2030. In parallel to these efforts, Japan’s Ministry of Economy, Trade and Industry (METI) and Civil Aviation Bureau (JCAB) announced the creation of a task force in June 2025 aimed at tackling the high cost of domestically produced SAF, to address the disparity between producers’ costs and airlines’ ability to pay. This task force is expected to present concrete recommendations and measures, which will support Japan’s ambition to replace 10% of conventional jet fuel demand with SAF by 2030. Other Asia-Pacific regional developments The Asia-Pacific region’s approach to SAF has moved from aspirational goals to legally binding mandates being established in several countries. In addition to the measures above, Thailand recently adopted a 1% mandate by 2026; meanwhile, India, Malaysia, Indonesia and South Korea have all set 1% SAF mandates by 2027, while also establishing their own SAF roadmaps. Although the development of SAF policy in Asia- Pacific is non-uniform – with some countries opting for mandates, others for incentives and some with roadmaps and legislation still in development – the region has seen significant momentum gathering behind SAF policies over the past year. With European mandates kicking off in 2025, Asian SAF production and feedstocks have significantly contributed to SAF volumes supplied in Europe to date. In 2024, Europe imported 69% of the feedstocks used for its SAF – with 38% coming from China alone – and also imported 40% of its refined SAF.80 Growing interest in sustainability and the economic opportunities associated with exporting fuels and feedstocks to Europe have contributed to the spike in measures from policy- makers in Asia-Pacific. However, the increasing prioritization of these feedstocks and fuels for domestic use in Asia-Pacific raises questions around Europe’s ability to keep importing such fuels over the long term. With European mandates kicking off in 2025, Asian SAF production and feedstocks have significantly contributed to SAF volumes supplied in Europe to date. Global Aviation Sustainability Outlook 2026 25
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