Singapore's civil aviation authority has set up a company, the Singapore Sustainable Aviation Fuel Company (SAFCo), to centrally procure SAF as part of the country's efforts to meet its decarbonisation targets, it announced on 30 October.
The country has a target of 1pc SAF usage for all flights departing its Changi and Seletar Airports in 2026. This is projected to rise to 3-5pc by 2030, subject to global developments and wider SAF availability and adoption.
SAFCo is a non-profit company wholly owned by the Civil Aviation Authority of Singapore (CAAS). It will bring together airlines, corporate SAF buyers, fuel producers, carbon market platforms and other stakeholders to aggregate demand, stimulate investment and accelerate SAF use. Global head of marketing and sustainability at oil major Shell's low-carbon solutions team Tan Seow Hui has been appointed as SAFCo's founding chief executive.
Singapore's senior minister of state for transport Sun Xueling had said in Parliament earlier this month that Singapore would pre-determine the total amount of money spent yearly on SAF — based on SAF targets and projected price premiums — and collect the sum via levies on passenger ticket prices. CAAS will share more details and the levy implementation date by the end of the year. It is now working with airlines to determine how levies will be collected and reflected in ticket prices, CAAS' director-general Han Kok Juan told reporters at a press conference on 30 October.
Predictable cashflows from the SAF levies would enable SAFCo to go into longer-term, competitive price agreements to secure a more stable and affordable SAF supply.
On top of the levies, SAFCo will also aggregate voluntary SAF demand from businesses and airlines that want to go beyond the 1pc target to reduce their air travel or supply chain carbon footprint. Companies can leverage the baseload of mandated demand to unlock economies of scale, and avoid needing to set up their own procurement systems, CAAS said. The authority is currently engaging various multinational corporations (MNCs) on this, with more information to be shared on the sidelines of the Singapore Airshow in February 2026.
The total pool of money will then go to a CAAS-administered SAF Fund which is disbursed to SAFCo.
"With this aggregated, more efficient way of procuring SAF, we can send a stronger demand signal to SAF producers. That will hopefully stimulate SAF investment and production, and have a dampening effect on SAF prices," Han said.
The premium of Argus fob Singapore SAF (class 2) netback prices over its conventional fob Singapore jet-kerosine counterpart neared record-lows of $948/t in February, but has since risen to $2,091/t as of 30 October. Singapore SAF values have been pushed up by its European SAF counterpart, because suppliers there sought to meet the 2pc ReFuelEU aviation mandate after mid-year.
Centralised SAF, environmental attributes procurement
SAFCo will use the funds to source SAF and SAF environmental attributes (EAs) through a "transparent, competitive tender process" from SAF suppliers that meet international sustainability standards like the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia), CAAS said. The first SAF volumes will be procured next year after levies are collected.
The SAF EAs will be registered with a SAF registry, and SAFCo will allocate them back to air operators and to companies with voluntary SAF demand. There will be proper claims and reporting with international reporting standards, and more details on sources of SAF and EA registries will be announced at a later date, Han said.
Under Singapore's sustainable air hub blueprint launched in 2024, CAAS will work with aviation stakeholders to reduce domestic aviation emissions from airport operations by 20pc from 2019's 404,000t levels in 2030 — accounting for projected growth — and achieve net-zero domestic and international aviation emissions by 2050.
