The two newest SAF-financing plans begin from the same problem. Sustainable aviation fuel costs more than conventional jet fuel and neither airlines nor producers can build a reliable market without someone paying the difference. Singapore has chosen a visible passenger charge. The Netherlands is proposing public-and-airport funding while easing a tax on the longest flights.
India has targets of 1 percent SAF in 2027, 2 percent in 2028 and 5 percent by 2030, the comparison matters. Its policy has set a direction for blending, but the larger question who pays the green premium and how suppliers gain confidence to invest, remains unresolved.
Singapore’s model is blunt but transparent. From October 1, 2026, the Civil Aviation Authority of Singapore will levy departing passengers, cargo shipments and business or general-aviation flights to finance centrally procured SAF. The charge applies to tickets and services sold from April 1, and varies by destination band and cabin.
The levy ranges from S$1 for economy or premium-economy travel within Southeast Asia to S$41.60 for premium-cabin travel to the Americas. An economy passenger flying to Europe, the Middle East or India falls into the S$6.40 band. A business or first-class passenger on the same route pays S$25.60.
The policy finances a 1 percent SAF uplift target for 2026. Singapore aims to increase that share to between 3 percent and 5 percent by 2030, subject to global supply and market conditions. The levy is expected to be adjusted when the blend requirement rises.
The advantage is certainty. A central buyer can aggregate demand, contract for SAF volumes and spread the cost across departing traffic. Airlines do not have to individually negotiate fuel supplies, while passengers can see the climate cost in the ticket price.
The drawback is equally clear. It treats aviation decarbonisation as a cost of flying, even for passengers who have few alternatives. It can also become politically difficult on long-haul, premium-heavy routes, where the levy is largest. Singapore partly manages this through distance- and cabin-based pricing. Those taking longer and more carbon-intensive trips contribute more.
The Netherlands is taking a less direct route. Schiphol and the Dutch Ministry of Infrastructure and Water Management intend to create a Euro 90 million SAF incentive fund for 2027 to 2029, with Euro 45 million from the state and Euro 45 million from the airport. The fund remains conditional on European Commission approval.
Its design is targeted. Airlines would receive support for SAF used beyond the amount already required under European rules, rather than being subsidised for compliance fuel. That turns the fund into an incentive for additional voluntary demand and, potentially, for early supply agreements.
At the same time, the Dutch government proposes cutting the planned long-haul air-passenger tax from Euro 74.81 to Euro 59.43. The change still requires approval by both chambers of parliament, while the SAF support needs European Commission clearance under state-aid rules. [nomadlawyer]
The logic is political as well as environmental. Long-haul flights are the routes for which SAF is most important and hardest to substitute, but they are also the most exposed to passenger-price sensitivity, international competition and diversion to nearby hubs. The Netherlands is therefore trying to stimulate cleaner fuel while avoiding a tax increase that might weaken Schiphol’s intercontinental connectivity.
Singapore makes users fund a defined volume of SAF. It creates predictable revenue and a clear demand signal, but adds a charge directly to travel. The Netherlands uses public money and airport resources to de-risk additional SAF purchases, while reducing a long-haul passenger tax. It limits the burden on travellers but shifts part of the cost to taxpayers and requires a more complex approval process.
Neither model fully removes the green premium. It only decides where that premium sits, on the ticket, in public budgets, in airport revenue or on airline balance sheets.
India should be cautious about copying either system wholesale. Its aviation market is heavily price-sensitive, domestic growth is rapid, and SAF production is still developing. A broad flat levy on every domestic ticket could provoke resistance and place a disproportionate burden on short-haul travellers while producing too little revenue to underpin major production projects.
A hybrid could make most sense. Government funding could underwrite early production and infrastructure, airlines could meet a steadily rising blend requirement; and a modest, clearly identified surcharge could apply first to international and premium travel, where price sensitivity is lower and the climate case for SAF is strongest. That would avoid making the cheapest domestic fare carry the full cost of a national industrial policy.