INDIA’S FIRST SUSTAINABLE AVIATION FUEL PLANT

Context
  • On August 18, 2025, Indian Oil Corporation (IOC) announced that its Panipat refinery will begin commercial-scale production of Sustainable Aviation Fuel (SAF) by December 2025.
  • The project marks a major step in India’s green transition in aviation fuel and supports global decarbonisation goals.

WHAT IS SAF?

  • SAF is a biofuel made from sustainable feedstocks (e.g. used cooking oil, agricultural waste, ethanol).
  • It is like conventional aviation turbine fuel (ATF) and can be used in current aircraft engines.
  • Airbus and others claim their aircraft can fly on up to 50% SAF-ATF blends.
INDIA’S FIRST SUSTAINABLE AVIATION FUEL PLAN explained for UPSC

KEY HIGHLIGHTS OF THE PROGRAM

  • Location: Panipat Refinery, Haryana
  • Production capacity: 35,000 tonnes/year SAF from used cooking oil (UCO)
  • Feedstock Sources: Major restaurant chains, hotels, food companies (e.g. Haldiram’s)
  • Challenge: Collection from small users and households

CERTIFICATIONS & COMPLIANCE

  • IOC is the first Indian company to receive ISCC CORSIA certification.
    • ISCC CORSIA: A globally recognized sustainability certification required for SAF under:
CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation).
    • This certification authorizes commercial SAF production and sets a benchmark for other Indian refiners.

GLOBAL & NATIONAL RELEVANCE

  • CORSIA Compliance:
    • From 2027, international airlines must offset CO2 emissions beyond 2020 levels.
    • SAF blending is a key method to comply.
  • India’s SAF Blending Targets (set by the National Biofuel Coordination Committee):
    • 1% by 2027 (international flights)
    • 2% by 2028
  • Potential Buyers: European airlines (already subject to SAF mandates)
  • Export Prospects: SAF demand is expected to surge globally in the coming years.

FUTURE PATHWAYS

  • Used Cooking Oil Pathway: Certified and ready for launch
  • Alcohol-to-Jet Pathway: IOC developing plants using ethanol to produce SAF
  • Multiple SAF Pathways Under Development: Other Indian companies are also setting up SAF units (need certifications before operations begin)

ECONOMIC & POLICY CHALLENGES

  • High production cost: SAF currently costs 3x more than conventional jet fuel.
  • Airline Resistance: Concerns about fuel cost escalation
  • Domestic SAF Mandates: Government likely to wait until 2027 or later to mandate SAF for domestic flights

WHY THIS MATTERS?

  • Decarbonising Aviation: SAF could contribute 60% of the global aviation sector’s emissions reduction.
  • Circular Economy: Utilizes waste (used cooking oil) for energy production.
  • Energy Security: Reduces dependency on fossil fuels; aligns with India’s Net Zero 2070 goals.
  • Green Diplomacy: Positions India as a potential SAF exporter, strengthening international partnerships in climate action.