Philippines: Budget carrier Cebu Pacific banks on government support to incentivise SAF use

Philippines: Cebu Pacific, a budget carrier, is pinning its hopes on government support to promote the use of sustainable aviation fuel (SAF), to make the cost of biofuel more affordable and hastening the aviation industry’s net-zero targets, reports Business.inquirer.

Alexander Lao, President and Chief Commercial Officer of Cebu Pacific, highlighted the current cost of SAF as a significant challenge, deeming it “prohibitive,” especially for long-haul flights, and typically ranging from three to five times the cost of conventional jet fuel. Lao noted that the industry is still in the early stages, with limited supply availability, but he expects that as supply increases, SAF prices will eventually decrease.

Cebu Pacific has taken steps towards using blended SAF for commercial flights, with one such flight taking place during the inaugural Singapore-Manila trip in September 2022. The airline’s Narita-Manila flight on October 25, 2023, will be the second commercial flight to utilize SAF.

SAF is considered a more environmentally friendly alternative to fossil fuel-based aviation fuel, as it can be derived from various feedstocks, including plant-based materials, used oil, forestry and agricultural waste, and used vegetable oils. In the Philippines, coconut oil, which is also used for biodiesel production, holds promise as a SAF feedstock.

While international airlines are under pressure to transition to sustainable fuel by 2027 due to the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia), the global production of SAF remains limited. Only Singapore and Belgium currently have SAF manufacturing facilities, contributing to just 0.1 percent of global production.

Lao suggests that one solution to drive SAF adoption is for government agencies to provide incentives for airlines that use SAF, which would stimulate demand and, in turn, increase supply. Cebu Pacific is the only Philippine airline that has been using SAF for commercial and delivery flights. Lao also stressed the importance of collaborating with government agencies to enhance the supply of raw materials used as SAF feedstock.

As these policies for increased SAF utilization remain pending, Cebu Pacific is actively working on other fuel-efficient measures to reduce its carbon footprint, including deploying more neo (new engine option) Airbus units. Neo units offer improved fuel efficiency, consuming 20 percent less fuel compared to other aircraft.


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