Tucked away in an industrial estate in Singapore’s Tuas district is the world’s largest refinery for sustainable aviation fuels (SAF), where organic waste products like used cooking oil and animal fats are converted into energy to power airplanes.

Built by Finnish fuel producer Neste in 2010, the facility underwent a $1.9 billion expansion in 2019. Reopened in 2023, it now produces up to a million tonnes of SAF annually. Most of Singapore’s sustainable jet fuel is exported to Australia and Europe, but Neste executive Mario Mifsud says Asia is the “next big frontier” for SAF.

“Asian governments are now making regulatory commitments to SAF,” Mifsud, who oversees the firm’s sales and trading in renewable fuels for the EMEA and APAC regions, told Fortune. “We’ve seen this in Europe—one or two countries start, and other countries will follow.”

In November, Singapore mandated that, by 2026, SAF make up 1% of all jet fuel used at its Changi and Seletar airports, with further plans to raise the quota to 5% by 2030, in line with the International Civil Aviation Organization (ICAO)’s goal to have net-zero carbon dioxide emissions by 2050.

“The 1% target doesn’t seem like a massive goal, but it will start the ball rolling,” Mifsud explains. “Neighboring countries will look and follow.”

Thailand also plans to reveal national SAF standards this year. Last July, national carrier Bangkok Air began using a 1% SAF blend, cutting about 128 kilograms of carbon emissions per flight. (On average, flying from London to New York generates about 493 kilograms of carbon per passenger, according to German nonprofit Atmosfair.)

Last May, South Korea became one of the first countries in Asia to mandate SAF on international flights, with the ruling slated to kick in by 2027. The country aims to scale up the proportion of SAF to between 7% and 10% by 2035. 

Globally, Europe leads in SAF adoption, with the region’s 2025 ReFuelEU policy mandating a 2% SAF blend. (The EU has a 70% SAF mandate which will kick in by 2050.)

SAF has been one way that the carbon-intensive aviation industry—responsible for 2.5% of global emissions—has tried to go green. Now, with governments getting serious about pushing airlines to use sustainable fuel, the industry may finally be starting to get off the ground. 

Ramping up production

Demand for SAF in Southeast Asia is projected to grow from 15,000 barrels per day in 2030 to over 700,000 barrels a day by 2025, according to the ASEAN SAF 2050 Outlook report. Production is likely to surge too, with ASEAN projecting daily production as high as 8.5 million barrels of SAF per day.

On Jan. 26, Hong Kong-based energy firm EcoCeres opened Malaysia’s first commercial-scale SAF production facility in the city of Johor Bahru, just across the border from Singapore. It can produce up to 420,000 metric tonnes of SAF each year.

During the launch of EcoCeres’ Tanjung Langsat plant, Noraini binti Ahmad, Malaysia’s minister of plantation and commodities, said Malaysia would soon have its own SAF targets.

“Under the National Energy Transition Roadmap, an initial SAF blending target of 1% is important to create demand and support market growth,” Noriaini said. “This plan reflects our strategy to position Malaysia’s commodity sector as a responsible player in the global energy transition, and by using certified waste-based biomass, we are adding value to our resources, strengthening supply chains and supporting higher value downstream activities.”

The Johor plant is EcoCeres’ second, following its factory in China’s Jiangsu province, which generates 350,000 metric tonnes of SAF per year. 

Matti Lievonen, the CEO of EcoCeres, said the Malaysia plant marks the firm’s first step to expanding internationally. “This place in Johor is excellent, because you have feedstock from Malaysia and other Southeast Asian countries, a really good seaway to pop out deliveries and a strong workforce in Malaysia.”

Scaling up

Aviation accounts for roughly 2.5% of global carbon emissions, yet ways to decarbonize the sector are still in the stage of development and are unfeasible for long-haul flights. 

Electric aviation, for example, may work for only very short trips, as it’s constrained by the energy storage capacity of batteries. (Jet fuel holds 30 times more energy per kg than the most advanced lithium-ion battery.)

A lack of feedstock is also holding back SAF production. The International Energy Agency is urging industry players to explore alternative feedstock sources apart from used cooking oil and animal fats.

“Renewable fuels are very much at the start-up phase,” Mifsud of Neste says. “When you’re in oil and gas, you drill a well and get your oil out—it’s very simple. But when you’re in renewable fuels, the collection of waste materials brings significant complexity.”

This story was originally featured on Fortune.com