India’s Sustainable Aviation Fuel potential 8-10 Mt by 2040

India is projected to produce 8 to 10 million tonnes of Sustainable Aviation Fuel (SAF) by 2040, requiring investments of US$ 70 to US$ 85 billion, according to a Deloitte India report. This anticipated production will be a key contributor to decarbonization efforts in the aviation sector, with the potential to reduce carbon emissions by 20 to 25 million tonnes annually.

According to a Deloitte India report, India has the potential to produce 8-10 million tonnes of Sustainable Aviation Fuel (SAF) by 2040, requiring investments between US$ 70 and US$ 85 billion (Rs 6-7 lakh crore) to reach this target. 

The report “Green Wings: India’s Sustainable Aviation Fuel (SAF) Revolution in the Making,” highlights SAF’s role in advancing the aviation sector’s decarbonization efforts, which could lead to a reduction in carbon emissions by 20-25 million tonnes annually. This production volume would not only exceed India’s estimated domestic demand of 4.5 million tonnes for a 15% blending mandate in 2040 but also position the country as a significant exporter of SAF in global markets.

The anticipated capital investment is expected to create between 1.1 and 1.4 million jobs across the SAF value chain and reduce crude oil import bills by US$ 5-7 billion each year. The production of SAF can also increase farmers’ incomes by 10-15% by utilizing agricultural residue as feedstock, offering a sustainable alternative to the current practice of burning crop waste.

Deloitte’s analysis notes that India has an estimated surplus of 230 million tonnes of agricultural residue, which is crucial for producing SAF, particularly for the second-generation ethanol required in the Alcohol-to-Jet (AtJ) technology pathway. The AtJ route can also initially use first-generation ethanol derived from sugar and grain until the technology matures. Additional feedstocks, such as Municipal Solid Waste (MSW), used cooking oil (UCO), sweet sorghum, seaweed, and industrial waste, will further enhance SAF production potential.

The report highlighted that for successfully adopting SAF, collective interventions from all stakeholders are essential. Establishing a clear demand roadmap, ensuring a stable feedstock supply, and creating multi-stakeholder Special Purpose Vehicles (SPVs) can help mitigate risks. Furthermore, financial incentives such as Production Linked Incentives (PLI), tax breaks, and viability gap funding will be crucial to stimulate early investments in SAF adoption.