India mandates 1% sustainable aviation fuel blend from January 2027

India's government is finalizing a sustainable aviation fuel policy as the country prepares for mandatory compliance with international carbon offsetting rules from January 2027.

Union Civil Aviation Minister K Rammohan Naidu directed stakeholders to accelerate production, certification and supply chain development to meet blending targets.

While chairing a high-level meeting July 30 with officials from multiple ministries, regulators, airlines, airport operators and oil marketing companies, Naidu said the draft SAF policy is in its final stages and that inter-ministerial consultations and stakeholder engagements are underway, according to state broadcaster DD India.

The minister said the government aims to ensure the transition imposes the least possible financial burden on passengers and airlines by identifying the most cost-effective production, distribution and airport supply mechanisms.

CORSIA compliance

The meeting reviewed India's readiness to comply with the Carbon Offsetting and Reduction Scheme for International Aviation, the International Civil Aviation Organization's global framework for reducing carbon emissions from international aviation. CORSIA's mandatory compliance phase begins Jan. 1, 2027.

India has committed to CORSIA's SAF blending targets of 1% for international flights by 2027, 2% by 2028 and 5% by 2030, Naidu said.

The minister directed all stakeholders to expedite identified action points so India is fully prepared before the mandatory phase begins.

The review assumes significance as airlines worldwide prepare to increase SAF use to reduce lifecycle carbon emissions from aviation, one of the most difficult sectors to decarbonize. India is working to develop a domestic SAF ecosystem, including feedstock availability, refining capacity, fuel certification and airport infrastructure.

SAF is a low-carbon alternative to conventional jet fuel, produced from renewable feedstocks such as used cooking oil, agricultural waste, municipal solid waste and biomass.

Production progress

Naidu said state oil marketing companies including Bharat Petroleum , Indian Oil and others are advancing SAF production projects.

The meeting assessed the status and commissioning timelines of production facilities being developed by oil marketing companies to ensure fuel availability from 2027 onward.

State-owned NTPC Ltd. is advancing a 1,800 metric tons/year SAF plant at Pudimadaka that will capture carbon dioxide from power plant flue gas, marking a shift toward using industrial emissions rather than crop-based feedstocks for clean fuel production, the company said July 10.

Indian Oil received India's first refiner ISCC certification for SAF production in 2025 blending approved feedstocks directly into existing refinery streams at low percentages.

Discussions at the meeting covered the proposed SAF blending roadmap, including the responsibilities of oil marketing companies, airlines and airport operators.

Stakeholders also reviewed plans for an accounting, monitoring and reporting framework aligned with ICAO's CORSIA requirements, a national SAF registry with end-to-end traceability, certification and market access, issuance of letters of authorization, and a CORSIA-compliant carbon market framework.

Naidu said the aviation sector has already taken steps to reduce emissions. While no airport operated entirely on green energy in 2014, 104 airports now run on 100% green energy, he said. The government is also encouraging aircraft leasing to help airlines induct more modern and fuel-efficient fleets.

The minister said production capacity is not the main concern, but the cost of SAF is considered higher than regular aviation turbine fuel.

The government's immediate priority is to achieve the 1% CORSIA blending requirement in the most cost-effective manner, while the carbon-credit offset mechanism must be developed through a whole-of-government approach, he said.

Platts, part of S&P Global Energy, assessed sustainable aviation fuel HEFA-SPK FOB Straits at $2,540/mt July 29, up $20/mt from the week before.

The SAF FOB Straits premium was assessed at $1,361.75/mt over Platts Jet Kero FOB Singapore forward curve (MOPs), up $74/mt from the week before.