Japan to Subsidize Sustainable Aviation Fuel Purchases for Airlines by 2026
The Japanese government plans to subsidize Sustainable Aviation Fuel (SAF) purchases by airlines, requiring passengers to pay an additional charge while mandating oil refiners to blend SAF into aviation fuel. This initiative aims to promote domestically produced SAF, which can reduce carbon emissions by up to 80%, with a policy framework expected by fiscal 2026. Japan will draw on subsidy models from Italy and the UK, targeting a 6% SAF blend by 2030 and 70% by 2050, while also supporting capital investments and collaboration for used cooking oil recovery.
Theia Market Signal Identification - AI Assisted
The Japanese government plans to subsidize the purchase of Sustainable Aviation Fuel (SAF) by domestic airlines, requiring passengers to pay an additional charge while oil refiners must blend SAF into aviation fuel. The initiative aims to promote domestically produced SAF and will be discussed at an upcoming public-private council meeting, with a policy framework expected to be finalized by fiscal 2026.
SAF can reduce carbon dioxide emissions by up to 80% compared to conventional jet fuel, but its procurement costs are 2 to 3 times higher. Japan will reference subsidy models from airports in Italy and the UK and the EU's blending requirements, which target a 6% SAF blend by 2030 and 70% by 2050. The policy will include capital investment support for suppliers and collaboration with municipalities to recover used cooking oil, as global demand for SAF is projected to reach 88 million kiloliters by 2030 and 650 million by 2050.
Comments