- Malaysia will produce SAF by 2027 with an initial capacity of one million metric tons per year, driven by two key refinery projects from EcoCeres and Petronas.
- The SAF blending mandate is set to reach 47% by 2050 as part of the National Energy Transition Roadmap to position Malaysia as a global SAF leader.
- Small farmers and palm oil producers benefit from palm waste used in SAF, which offers higher value and creates new revenue opportunities.
Malaysia will begin producing sustainable aviation fuel (SAF) in 2027, targeting an initial output of one million metric tons annually. Plantation and Commodities Minister Johari Abdul Ghani announced this plan on Tuesday. Production will gradually increase, driven by factory output and feedstock availability.
Malaysia, the world’s second-largest palm oil producer, aims to position itself as a global leader in SAF production. The National Energy Transition Roadmap, launched in 2023, includes an SAF blending mandate. This starts with a 1% blend and aims to reach 47% by 2050.
Johari highlighted two significant projects that will increase SAF production. EcoCeres Renewable Fuels Sdn Bhd and Petronas are constructing refineries in partnership with Enilive and Euglena. These plants will produce 350,000 and 650,000 metric tons of SAF annually. Combined, they will help Malaysia meet its goal of making one million metric tons per year.
Malaysia also plans to export any surplus SAF to countries without production capacity. The government seeks to attract more investors through tax incentives to establish the country as a hub for SAF production. Johari stated that the SAF industry would create opportunities for small farmers and palm oil producers, as palm waste used in SAF offers higher value than crude palm oil.
As Malaysia advances its SAF plans, other ASEAN countries also move toward cleaner aviation. Singapore will require all departing flights to use SAF by 2026. By 2030, the SAF blend will rise to 3-5%, depending on global supply and adoption. In October, Indonesia completed its first commercial flight using palm oil-blended jet fuel, with Garuda Indonesia flying from Jakarta to Surakarta, covering 550 km.
Countries worldwide are prioritising SAF to cut carbon emissions in the aviation sector. SAF, derived from renewable sources such as palm oil waste, allows airlines to reduce their carbon footprints. The International Air Transport Association (IATA) has set a target for the aviation industry to reach net-zero carbon emissions by 2050, with SAF playing a crucial role.
Malaysia’s large palm oil industry will support the country’s SAF production goals. By converting palm oil waste into fuel, Malaysia aims to boost its palm oil sector’s value and contribute to global sustainability efforts. Johari emphasised that smallholder farmers will benefit from this shift as SAF production creates new income streams.
Besides palm waste, Malaysia also considers using other feedstocks, like used cooking oil, to support SAF production. The government is exploring various sources to ensure a steady feedstock supply, which will help the country maintain consistent SAF production as demand grows.
Malaysia’s move into SAF production aligns with its broader strategy to transition to cleaner energy sources. The government will continue supporting industries contributing to this transition, ensuring Malaysia stays competitive in the global energy market.