Singapore’s green fuel levy: A step forward but harder work awaits

THE recently passed bill to impose a levy on passengers of all departing flights from Singapore marks a turning point in the country’s efforts to decarbonise its transport sector.

The levy, which will fund the procurement and use of sustainable aviation fuel, signals Singapore’s intention to adopt cleaner fuels in the transportation sector despite the higher prices of such fuel. Proceeds will go into a fund managed by the Civil Aviation Authority of Singapore, which will help airlines offset some costs of adopting sustainable fuel blends.

From 2026, all departing flights must use at least 1 per cent sustainable fuel, and are expected to increase usage to 3 to 5 per cent by 2030. Given the limited regional supply and high prices of such fuel, the levy will help to level the playing field by supporting airlines through the transition.