S’pore studying govt mandate, incentives to drive demand, lower cost for green jet fuel: Iswaran

He said Singapore is working closely with international and regional organisations to study how Asean can tap potential SAF feedstock within the region.

While he did not directly mention the use of palm oil in the production of SAF – a practice that has drawn criticism from environmental groups – Mr Iswaran said that there are some abundant SAF feedstock in Asia-Pacific region that may not be as widely accepted in certain parts of the world due to perceived higher environmental risks.

“We think it is most important to establish a scientifically driven process to validate the sustainability of feedstock,” he added.

Mr Iswaran also highlighted the importance of supporting research and development into more nascent SAF production technologies, such as power-to-liquid technology. This process uses renewable energy to combine hydrogen molecules with carbon extracted from the atmosphere or industrial waste gas to produce synthetic jet fuel.

In addition, the minister called for policies on SAF use and accounting to be harmonised and for a mutually recognised set of common standards, citing the “aviation green lanes” that Singapore is seeking to develop with the United States, Japan, and New Zealand as an example.

“If we do not have that, then we really will have a patchwork of solutions around the world… For airlines and industry players, I think this is going to be a challenge,” Mr Iswaran said.

The minister also pointed out the need to work closely with the industry, given that SAF production is still a relatively new field.

In this respect, he gave the example of Finnish energy giant Neste and its expanded refinery in Singapore, which has the capacity to produce up to a million tonnes of SAF per year.

“This is a significant move – by no means sufficient, but definitely necessary,” Mr Iswaran said.

Mr Sami Jauhiainen, Neste’s acting executive vice-president for renewable aviation, told The Straits Times that Singapore is now the company’s biggest SAF production hub.

While scaling up production has benefits in terms of efficiency, Mr Jauhiainen said it is hard to see the price of SAF falling to the same level as conventional fossil fuels.

“The technology we use is not really new. We have already been working on it for quite a long time, and our engineers have been exploring how to get the most out of it for a while, so I don’t think the cost difference is likely to disappear,” he told ST.

This means that the increased costs of SAF will need to be passed on to passengers, but this is where government regulations can play a key role, he added.

Mr Jauhiainen said mandates on SAF use will create a level playing field for all airlines, while incentives will be able to help push passengers and companies to voluntarily pay for the additional costs in the early stages of adoption.