Update on Government's Study on Use of Sustainable Aviation Fuels

Mr Leon Perera asked the Minister for Transport (a) whether he can provide an update on the Government’s study on the use of sustainable aviation fuels in the local aviation industry; and (b) whether Singapore’s readiness to participate in the voluntary phase of the Carbon Offsetting and Reduction Scheme for International Aviation has been delayed by the impact of COVID-19 on the aviation industry and, if so, what is the extent of the delay.

Mr Deputy Speaker, sustainable aviation fuels, which are produced from resources such as waste oil, can reduce carbon emissions by up to 80% compared to conventional jet fuel, on a life-cycle basis. However, it is important to note that today, sustainable aviation fuels are two to five times more expensive than conventional jet fuel.

The Singapore Government and our industry partners have conducted a study of the operational and commercial viability of sustainable aviation fuels at Changi Airport. The study presented options to integrate these fuels with traditional jet fuel at Changi Airport, such as at existing jet fuel facilities, or at tank terminals in the existing supply chain; in other words, where it is the most efficient way to integrate this within the supply chain for jet fuels.

It also identified viable feedstock-technology combinations for sustainable aviation fuel production in Singapore, based on the availability of feedstock in the region, cost and life-cycle assessments. The report also suggested various options to facilitate uptake and production of sustainable aviation fuels in Singapore. Our agencies are reviewing the findings.

Despite COVID-19, Singapore is participating in the voluntary phase of the International Civil Aviation Organization’s (ICAO) Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), which aims to cap the international aviation sector’s emissions. The Civil Aviation Authority of Singapore (CAAS) and Singapore-based carriers, namely Jetstar Asia, Scoot and Singapore Airlines, are monitoring and reporting the airlines’ emissions under CORSIA.

I thank the Minister for his comprehensive explanation. Just one supplementary question. Given that we have a strong petrochemical cluster and given that some study has already been done on sustainable aviation fuels, is the Government also looking at the possibility of Singapore becoming production or export hub for sustainable aviation fuels, particularly as demand for such fuels may increase over time as prices tend to drop due to commercial scale being achieved in the future?

Mr Deputy Speaker, I thank the Member for his question. Firstly, as the Member would know, in our larger chemical, petrochemical ecosystem in Singapore, we already have players, like Neste, who focus on the bio-fuels aspect. I think that is an important part of our development going forward, because we have always proactively wanted to anchor some of these more sustainable options as part of the broader fuel mix available in Singapore.

Secondly, the Member's point is well taken. In fact, it is something that our agencies are studying; how we can not just produce these sustainable aviation fuels for our own needs, but also be available for export.

In a manner of speaking though, firstly, I want to highlight that the supply side of it is still constrained. As I had mentioned, in this study, one of the things we need to look at is how we can not just make it available in sufficient quantities, which in itself is a challenge, but also do so in a manner that is cost-competitive. I would add that it is something that we are focused on as part of the process going forward.

Secondly, if, in fact, we are able to develop this in a very strong manner, then, it is not just for Singapore-based carriers, but potentially other carriers who come to Singapore may also be able to use these sustainable aviation fuel options. Therefore, that is also a manner of export.

So, long before we talk about physically exporting them to other locations, there are (a) supply chain developments already taking place in Singapore; (b) our focus is on costs, viability and adequate supply; (c) that once we are able to work on this and implement this, then it will be available to aviation players in Singapore, based out of Singapore using Changi as a hub and, potentially, also for the region.