India is gearing up for a mandatory 1pc sustainable aviation fuel (SAF) blend from 2027, triggering a rush among market participants to secure feedstocks and scale up domestic production.
The country is on track to implement blending targets of 1pc by 2027, 2pc by 2028, and 5pc by 2030. Domestic SAF plants have been gearing up by securing international certification and efforts to secure consistent feedstock supplies.
Indian state-owned Bharat Petroleum's (BPCL) refinery in Mumbai received the ISCC CORSIA certification for SAF production via the used cooking oil (UCO) co-processing pathway, it announced at the end of May. The SAF production facility is expected to become operational by the end of 2026, but the company has not disclosed the planned production capacity.
This certification allows SAF produced at the plant to be used by airlines to meet their greenhouse gas reduction obligations under the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia).
Upstream firm Indian Oil's (IOC) Panipat refinery became the first in the country to achieve the ISCC CORSIA certification in August 2025 and was expected to begin producing SAF from UCO later that year, with an initial production capacity of 35,000 t/yr. But the project has been delayed and is now expected to start in the second half of this year, a source close to the matter told Argus.
Besides ramping up co-processing of waste oil feedstocks to produce SAF, several Indian firms have announced ambitions of producing neat SAF through the hydro-processed esters and fatty acids (HEFA) pathway. IOC recently approved a joint venture with M11 Energy Transition to develop a $110mn SAF project in Paradip, Odisha, using the HEFA pathway. In January, Essar Future Energy disclosed plans to build a 800,000 t/yr SAF and hydrotreated vegetable oil (HVO) plant in the Gujarat state's Devbhumi Dwarka district. The hydrotreated biofuels produced will have both ISCC EU and Corsia certification.
Plants have also been preparing by taking the initiative to secure adequate waste feedstock supplies for HEFA SAF production — often a key constraint to realising projects. Feedstock UCO can be domestically procured through hotels, restaurants, and households, but domestic supply is still at a nascent stage, lacking infrastructure to streamline collection and require collaboration between companies and government authorities for efficient supply.
Mangalore Refinery (MRPL) in May issued a tender for the supply of 35,000t of Indian UCO for SAF production, to be delivered over a period of one year between 1 September 2026 to 31 August 2027.
Given domestic supply limitations, Indian producers are also seeking feedstock from overseas. Imports are allowed if plants are located in free-trade zones and producing for export, although the government prefers to limit imports to support energy independence. India has been consistently procuring food waste oil (FWO) from China for biodiesel production, and could begin using these volumes for SAF production. FWO is considered an advanced feedstock under the EU's Renewable Energy Directive. Shipping data firm Kpler reported flows of 143,533 cargoes of FWO from China to India in 2025, with all purchases made by MRPL's New Mangalore Refinery plant. Hydrotreating-grade FWO typically commands a premium of 50-100 yuan/t or $5-10/t over hydrotreating-grade UCO fob China, which Argus last assessed at $1,200/t on 5 June.
Participants are also considering feedstock imports from southeast Asia, particularly Indonesia and Malaysia. Argus last assessed strait of Malacca UCO at $1,170/t fob on 5 June.
Alcohol-to-jet ambitions
Ethanol is also drawing attention as a feedstock for SAF because of oversupply in the domestic market Ethanol can be converted into SAF through the alcohol-to-jet (ATJ) pathway, which involves converting ethanol into hydrocarbons and refining it into molecules suitable for blending with aviation fuel. But this process is resource intensive, which can make ethanol-based SAF less competitive for airlines because of higher costs.
India's ethanol production capacity stood at 19.53bn litres/yr as of 31 October 2025, data from the Department of Food and Public Distribution show. This capacity is expected to be sufficient to help meet the country's SAF targets and support the ethanol industry, which is facing weak demand. Achieving a 5pc SAF blending target by 2030 would require about 700mn litres/yr of SAF, according to the oil ministry, while industry experts estimate the requirement at nearly 500mn litres/yr.
Despite a wave of recent ATJ plant announcements, the technology could take years to completely become fully established. IOC had announced ATJ-SAF production capacity in collaboration with US startup LanzaJet, targeting a production capacity of 86,800 t/yr. The plant is expected to become operational by March 2028. LanzaJet owns the world's first fully commercial, large-scale ATJ-SAF plant in Georgia, US, which began production in November 2025 following several years of delays.
Biofuels firm GPS Renewables in April announced collaboration with Lummus Technology on an ATJ project at Pudimadaka, Andhra Pradesh. The plant is expected to produce 1,800 t/yr of SAF and is scheduled to begin operations by March 2029.
