Levy Funded Marketplace
The Civil Aviation Authority of Singapore has officially incorporated the Sustainable Aviation Fuel Company SAFCo, a fully owned non profit that will act as a clearing house for every litre of sustainable fuel used by departures from Changi and Seletar. Beginning in 2026, a distance based levy on tickets and cargo consignments will flow into a dedicated fund, giving SAFCo a steady cash stream to purchase fuel through competitive tenders that meet Corsia sustainability criteria.
Dual Demand Engine
Beyond the mandatory pool, SAFCo plans to assemble a voluntary book of business from airlines, freight forwarders, and corporate travel departments eager to claim additional carbon savings. Aggregating the two flows multiplies purchasing muscle and reduces administrative duplication. For producers, the combined demand represents a single transparent request for proposals rather than dozens of small contracts.
Fresh Perspective
A seldom mentioned advantage is that the system turns Singapore into a live market signal for Asia Pacific. Because the levy amount is fixed regardless of raw fuel price, the volume of SAF purchased will float naturally with market conditions. Suppliers therefore gain a real time demand indicator that directly reflects price movements, similar to how spot electricity markets guide power plant output. This feedback loop could accelerate regional refinery investment more effectively than blunt mandates.
Implementation Timeline
Initial procurement is targeted for 2026, aligned with the one percent SAF usage goal. The ambition rises to as much as five percent by 2030, contingent on global supply. With only ten staff planned in the first year, SAFCo will lean heavily on digital systems to manage bids, traceability certificates, and levy reconciliation.
Conclusion
By fusing stable funding, aggregated demand, and open tendering, SAFCo offers a pragmatic template for other hubs seeking lower carbon aviation without sacrificing competitiveness.