The decarbonization of the aviation sector represents one of the most complex challenges in the transition toward a low-carbon economy. Among the emerging solutions, Sustainable Aviation Fuel (SAF) offers a concrete prospect for reducing the environmental impact of flights without compromising the growth of the sector. In this context, a recent joint ASEAN–Canada study has highlighted the remarkable potential of Southeast Asia as a future global producer of SAF.
The study “Promoting the Production of Sustainable Aviation Fuels from Agricultural Waste in the ASEAN Region“ documents how countries such as Indonesia, Malaysia, the Philippines, Thailand, and Vietnam possess abundant agricultural feedstock resources suitable for the production of sustainable fuels. These five countries could represent about 90% of the region’s SAF production capacity.
The research indicates that, with the necessary improvements in economic feasibility, SAF production in ASEAN nations could not only meet regional demand but also generate a surplus for export.
One of the most relevant aspects that emerged from the study concerns the transformation of some countries from consumers to exporters. By 2040, Indonesia, the Philippines, Thailand, and Vietnam could become net exporters of SAF. Japan and South Korea have already been identified as key potential importers.
The most efficient supply chains to distribute SAF to these markets should mainly originate from Malaysia, Vietnam, and Indonesia, thereby creating an integrated regional ecosystem for the production and distribution of sustainable fuels.
Diversity of available feedstocks
Southeast Asia has a diverse range of feedstocks with high potential for SAF production:
Rice straw and husks represent some of the most promising feedstocks, with rice straw showing the lowest carbon intensity (CI) score in many countries in the region. In Malaysia, for example, rice straw used with Fischer–Tropsch (FT) technology has a CI of only 5.6 g CO₂e/MJ SAF.
Indonesia, the world’s largest palm oil producer, generates large volumes of residues such as Empty Fruit Bunches (EFB), Palm Kernel Shells (PKS), Palm Oil Mill Effluent (POME), and Palm Fatty Acid Distillate (PFAD). Malaysia, the second-largest global producer, also has these resources in significant quantities.
The Philippines has proposed the use of non-standard coconuts (nuts that do not meet human consumption standards) as feedstock for SAF. In Thailand, in addition to rice and cassava residues, sugarcane and used cooking oil (UCO) are also relevant.
Around 75% of the SAF feedstock potential in the region comes from agricultural and post-consumer waste, highlighting a circular approach to resource management.
Sustainability as a guiding principle
A key element of this development is the commitment to truly sustainable growth. The ASEAN–Canada research project emphasized the expansion of feedstock supply without increasing deforestation or changing land use.
The increase in feedstock availability should come from improved agricultural practices and large-scale biomass use, rather than from expanding cultivated land. This includes mechanization, more efficient irrigation systems, and research into crop optimization.
The use of agricultural residues such as rice straw—which is often burned, causing air pollution—represents a double environmental opportunity: reducing existing pollution and producing cleaner fuels.
Concrete Initiatives already underway
Several countries are developing specific roadmaps and targets:
Indonesia published a SAF roadmap and action plan in September 2024, with an initial SAF blending target of 1% for international flights starting in 2027, increasing to 2.5% by 2030 and to 30% by 2050.
Malaysia aims to produce one million metric tons of SAF per year by 2027 and has set a SAF blending mandate starting at 1%, with a target of 47% by 2050.
Thailand is finalizing a proposal for incentives for local SAF use, while Thai Airways International has set blending targets ranging from 2% to 60% between 2025 and 2050.
The Philippines is developing a SAF roadmap, expected in 2025, with a blending target of 1% of total aviation fuel by 2026.
Singapore launched a sustainable aviation plan in 2024 and will implement a 1% SAF mandate in 2026.
The private sector is also actively contributing. Several regional airlines have already begun incorporating SAF into their flights: Cebu Pacific was the first low-cost airline in Southeast Asia to use SAF, with its first flight powered by a 35% blend in 2022.
Investments in production are being developed. In Thailand, BSGF Company Limited and BAFS are building production plants, while the Bangchak Group has started constructing a 1 mbpd unit. In Indonesia, PT Pertamina Patra Niaga has obtained the necessary certifications and is developing the RU III Green Plaju refinery, scheduled for completion by 2027.
In Malaysia, Petronas is collaborating with palm oil producers and is building, together with EcoCeres Renewable Fuels, a facility with significant production capacity. In the Philippines, major projects are also underway, with WasteFuel planning to build an FT plant and Prime Infrastructure Capital having formed a unit for a waste-to-fuel project.
Socio-Economic impacts of the energy transition
The transition to SAF also brings significant socio-economic benefits for local communities.
Each large-scale biorefinery could generate about 1,000 jobs during the construction phase and 100–300 direct operational jobs, along with 500–1,200 indirect jobs in the supply chain. For rural areas, this represents a significant economic development opportunity.
The involvement of small farms and community cooperatives in the supply chain would strengthen the local economy and social fabric, creating a sense of collective participation in a sustainable development project.
With the potential to supply around 12% of global SAF demand by 2050, Southeast Asia can play a decisive role in achieving global climate targets in the aviation sector.
The transition to sustainable aviation fuels is a complex but necessary challenge. Southeast Asia’s potential to contribute significantly to this transition deserves attention and support from the international community, financial institutions, and aviation stakeholders.