Singapore launches SAFCo to centrally procure green jet fuel, funded by passenger levy

Singapore has established the Singapore Sustainable Aviation Fuel Company Ltd. (SAFCo), a government-owned entity under the Civil Aviation Authority of Singapore (CAAS), to centrally procure sustainable aviation fuel (SAF) for Changi and Seletar airports. SAFCo aims to support Singapore's national SAF policy by aggregating demand from airlines, corporate buyers, and other stakeholders to stimulate investment and secure a more stable, affordable supply of SAF through competitive tendering. The initiative is funded by a levy imposed on all passengers and cargo flying out of Singapore, with the goal of increasing SAF usage to 1% by 2026 and between 3-5% by 2030, contingent on global developments and fuel availability. By centralizing procurement, SAFCo seeks to reduce fuel costs and provide economies of scale, addressing the current challenge where SAF costs three to five times more than conventional jet fuel. This centralized approach is novel in aviation and has been shared with the International Civil Aviation Organization to potentially serve as a model for others. SAFCo's leadership includes CAAS Director-General Han Kok Juan as chairman and Tan Seow Hui, former Shell Low Carbon Solutions executive, as CEO, highlighting the government's commitment to sustainable aviation and carbon footprint reduction.