Japan to implement policies to raise SAF use, supply

Japan's trade and industry ministry (Meti) plans to introduce a sustainable aviation fuel (SAF) mandate to achieve the country's target of 10pc SAF use by 2030, as well as tax exemptions.

Meti unveiled the draft on 26 May, aiming to encourage SAF use and supply in the country. This includes a mandate requiring domestic suppliers to deliver volumes that are at least 10pc SAFby 2030. The suppliers could be domestic refiners, but details have not been disclosed yet. The volumes will supply domestic and international flights by Japanese airlines and non-Japanese carriers.

Exemptions on import tariffs and carbon levies are also included in the draft, subject to SAF feedstocks, and SAF produced outside Japan that have Japanese companies' involvement.

The plan aims to supply SAF at competitive prices in the country. Utilising domestic feedstocks — such as used cooking oil (UCO) — is a key factor in establishing a SAF supply chain that will contribute to the country's energy security and carbon dioxide reduction goals, Meti said.

Around 380,000t of UCO was collected in Japan during the April 2021-March 2022 fiscal year, according to the country's federation for UCO recycling co-operatives UCO Japan. Of which, 200,000t was used for livestock feed, mainly for chicken, while 120,000t was exported to mainly Europe.

Domestic market participants, especially those that are producing SAF, are urging domestic exporters to reduce UCO shipments. Meti is also considering developing a scheme to encourage domestic UCO recycling in alignment with other ministries, including the agriculture ministry. The agriculture ministry is currently the main jurisdiction for UCO, according to market participants.

Japan's land and transportation ministry (Mlit) predicts the country's 2030 SAF consumption will be 1.71mn kilo litre/yr (10.8mn bl/yr), comprising 880,000 kl by domestic airlines, and 830,000 kl by non-Japanese air carrier. Domestic supply capacity is forecast around 1.92mn kl in 2030.

By Maiko Nakashima