• Home
  • News
  • CAAS Sets Up Singapore Sustainable Aviation Fuel Company to Centrally Procure SAF
Aerospace, Airport, Business-industry-data-aerospace, News, Singapore, Sustainability

CAAS Sets Up Singapore Sustainable Aviation Fuel Company to Centrally Procure SAF

  • 12 Nov 2025

The Civil Aviation Authority of Singapore (CAAS) has announced the establishment of the Singapore Sustainable Aviation Fuel Company Ltd. (SAFCo) to centrally procure sustainable aviation fuel (SAF) for Singapore’s air hub and support the nation’s SAF policy.

The set up of SAFCo follows the passing of the Civil Aviation Authority of Singapore (Amendment) Bill in Parliament on 14 October 2025. SAFCo will be a non-profit entity wholly owned by CAAS, with Mr. Han Kok Juan, Director-General of CAAS, as Chair of its Board. Through SAFCo, CAAS aims to create a transparent, integrated SAF demand market in Singapore, bringing together stakeholders across the aviation fuel chain to aggregate demand, stimulate investment, and expedite SAF usage.

SAFCo will procure SAF with funds collected from the Sustainable Aviation Fuel (SAF) Levy imposed on flights departing from Singapore. The levy will contribute to a dedicated SAF Fund, which will be used to purchase sustainable aviation fuel and its associated environmental attributes (EAs).

With the predictable and stable cashflows, SAFCo has the opportunity to go into longer and larger contracts with SAF suppliers, providing demand certainty in a still nascent SAF market. This would help to promote investment in SAF production capacity and foster the development of the SAF supply ecosystem and SAF-related carbon markets in Singapore and the region.

Photo of Changi Airport Jewel by Cyrill, Pexels.

Under Singapore’s national SAF roadmap, SAF is expected to make up at least 1 per cent of the total jet fuel uplifted at Changi and Seletar airports in 2026. The target will progressively increase to 3–5 per cent by 2030, depending on supply availability and global market developments.

On 10 November, CAAS announced the introduction of the SAF Levy that will apply to all passengers, cargo shipments, and general and business aviation flights leaving Singapore starting from 1 October 2026. This will be relevant for tickets and services sold from 1 April 2026.

Depending on the travel destination and cabin class, the SAF levy per ticket will range from S$1 to S$41.60. The SAF levy for an economy class ticket to popular destinations like Bangkok, Tokyo, and London are S$1.00, S$2.80 and S$6.40 respectively. This amount is lower than CAAS’ previous estimates of S$3.00, S$6.00, and S$16.00 for economy class tickets to the same three destinations, reflecting a lower prevailing cost of SAF as compared to when the initial estimates were made earlier.

Beyond the regulated demand from the SAF Levy, SAFCo will aggregate voluntary demand from businesses seeking to cut their carbon footprint through SAF purchases. By combining this voluntary demand with the levy-funded base load, SAFCo can secure better pricing and long-term supply agreements for SAF and SAF EAs. This would help to give companies access to competitively priced, verified SAF without the need of setting up their own systems.

Airplane taking off. Photo by Jeffry S.S, Pexels.

Airplane taking off. Photo by Jeffry S.S, Pexels.

SAFCo’s immediate focus will be on establishing governance and procurement frameworks, setting up levy collection systems and processes to build manpower and procurement capabilities, as well as looking into engaging stakeholders on the implementation ahead of its first SAF procurement in 2026. SAFCo will also develop a scalable voluntary demand programme for SAF and SAF EAs as a complement to the SAF Levy. Plans to engage with businesses and airlines are ongoing to promote more partnerships and encourage them to utilise the centralised procurement system for voluntary SAF procurements. More details on this will be provided on the side of the Singapore Airshow in February next year.

“Singapore is taking a pragmatic, balanced and action-oriented approach to advancing sustainability in the aviation sector. The setting up of SAFCo is another concrete step forward,” said Mr Han Kok Juan, Director-General of CAAS and Chairman of SAFCo. “Through SAFCo, we want to get the best value for the SAF Levy collected and activate a SAF ecosystem which will help advance sustainable aviation and create new economic opportunities for Singapore and beyond.”

Ms Tan Seow Hui, the newly appointed Chief Executive Officer of SAFCo said, “By working closely with airlines, businesses and suppliers, we aim to facilitate greater SAF adoption in the region and contribute to the decarbonisation of aviation.” 

You May Also LikeAAIS

Previous Article
Next Article