CAAP Advances Sustainable Aviation Fuel Policy for Philippines

The Civil Aviation Authority of the Philippines (CAAP) has initiated a strategic move to integrate Sustainable Aviation Fuel (SAF) into the country's aviation sector, aiming to significantly reduce carbon emissions. This initiative was formalized during the 2026 SAF Policy Development Workshop held on March 24, 2026, which set the groundwork for a national framework to support local SAF production and adoption, with a target of cutting emissions by 65% to 80%.

This policy push is designed to align the Philippines with global decarbonization efforts, particularly the International Civil Aviation Organization (ICAO) and its Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). By developing a domestic SAF supply chain, the country aims to not only meet its international obligations but also to reduce its dependency on imported fossil fuels and leverage its robust agricultural sector as a source for renewable feedstock.

A National Framework for Decarbonization

The CAAP is collaborating with key government agencies, including the Department of Energy (DOE) and the Board of Investments (BOI), to create a comprehensive regulatory environment. The framework intends to establish blending mandates, investment incentives, and support systems for building local biorefineries. The primary feedstock identified is agricultural waste, specifically from the nation's extensive rice and coconut industries.

In a statement from the policy workshop, CAAP Director General Raul L. Del Rosario emphasized a unified strategy. "We reaffirm our commitment in making SAF adoption more viable and accessible, leveraging collaboration between government, industry, and private partners to shape a sustainable and forward-looking Philippine aviation sector," he said.

Economic and Agricultural Impact

The shift toward local SAF production presents a significant economic opportunity. Nigel Paul C. Villarete, a senior adviser at Libra Konsult, highlighted that a domestic supply would ease pressure on foreign exchange reserves currently used for fuel imports. Prior to the pandemic, Philippine aviation fuel consumption peaked at 2.8 billion liters in 2019, underscoring the scale of the potential market. However, Villarete also cautioned that the economic and environmental benefits must be clearly measured to ensure long-term viability and avoid competition with food supplies.

The policy directly impacts the Philippine agricultural sector by creating a new, potentially lucrative market for waste products like rice husks and coconut oil. This could provide an additional revenue stream for farmers and stimulate rural economies. For domestic airlines such as Cebu Pacific, Philippine Airlines, and AirAsia Philippines, the policy will necessitate transition costs for SAF procurement but is crucial for compliance with impending CORSIA mandates.

Airline Adoption and Regional Context

Among Philippine carriers, Cebu Pacific is the current frontrunner in SAF adoption, having operated its first SAF-powered commercial flight from Singapore to Manila in September 2022. While Philippine Airlines and AirAsia Philippines have announced future integration plans, Cebu Pacific's flight serves as the primary operational precedent for the domestic market. AirAsia has a broader group target to increase its SAF usage to 70%, or 1.90 million tonnes, by 2050.

The Philippines' move mirrors a growing regional trend. In February 2024, Singapore announced a mandate requiring all departing flights to use 1% SAF starting in 2026, with plans to increase this to 3-5% by 2030. This provides a regulatory template that CAAP is likely considering as it develops its own national policy.

Sustainable Aviation Fuel vs. Conventional Jet Fuel

Technical Analysis

This policy development is a direct response to the structural pressures of global aviation decarbonization, primarily driven by ICAO's CORSIA. The initiative positions the Philippines to transition from a fuel importer to a potential regional manufacturing hub for SAF. The country's strong agricultural base provides a unique advantage for feedstock supply. However, the primary challenge remains the significant capital investment required to build biorefineries at scale. The Board of Investments is actively promoting the Philippines as an investment destination to address this gap and meet the projected global SAF demand of 450 billion liters by 2050. With the Asia-Pacific region expected to account for 37% of global passenger traffic, establishing a local production capability is a strategic imperative for long-term energy security and economic growth.

What Comes Next

The immediate timeline focuses on finalizing the legal and regulatory structures. The National SAF Regulatory Framework, drafted by CAAP and the DOE, is expected to be completed by late 2026. This will pave the way for the mandatory phase of CORSIA, which is confirmed to begin for participating states, including the Philippines, in 2027.

Why This Matters

CAAP's initiative represents a critical step in aligning the Philippine aviation industry with global sustainability standards. The move not only addresses environmental responsibilities but also aims to create a new economic pillar based on renewable energy, reducing fossil fuel dependency and enhancing the value of the agricultural sector. For the broader Asia-Pacific region, it signals another nation's commitment to building a viable SAF ecosystem.