Singapore airfares set to rise from 2026 over green fuel requirements


Singapore Changi Airport. (Photo: Unsplash)

The Singaporean government plans to require all departing flights to use sustainable aviation fuel starting in 2026. This move is widely believed to increase costs for airlines, which may be passed on to passengers.

Singapore’s Transport Minister, Chee Hong Tat, announced the plan at the 2024 Changi Aviation Summit, ahead of the 6-day Singapore Airshow. He stated, “this will provide an important demand signal to fuel producers and give them the incentive to invest in new sustainable aviation fuel production facilities. Without an increase in supply, we will not be able to scale up the adoption of sustainable aviation fuel in the years ahead.”

In the Sustainable Air Hub Blueprint, the Singaporean government plans for sustainable aviation fuel usage to reach 1% by 2026 and increase to 3%-5% by 2030. Chee stated that the cost impact is “manageable” and that there will be sufficient time for businesses and passengers to adapt before the policy is implemented in 2026.

According to preliminary estimates by the Civil Aviation Authority of Singapore (CAAS), economy class passengers flying from Singapore to Bangkok, Thailand, may have to pay an additional 3 SGD (about 2.2 USD) per flight. Flights to Tokyo, Japan, could see an increase of 6 SGD (about 4.5 USD), while flights to London, UK, could increase by 16 SGD (about 12 USD).

Sustainable aviation fuel is priced at approximately 3-5 times the cost of traditional aviation fuel. Many airlines have complained about the insufficient supply of reasonably priced fuel. On the other hand, fuel producers are concerned that the demand may be suppressed, leading to a reluctance to produce large quantities.

Due to the nascent nature of the sustainable aviation fuel supply market and expected price fluctuations, the Singaporean authorities have decided that the tax amount will be based on the demand and forecasted price for the year. The tax collected will be used to purchase sustainable aviation fuel. The Civil Aviation Authority of Singapore (CAAS) plans to announce more regulations and details closer to the implementation date in 2025.

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