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Singapore’s plan for flight levy linked to green fuel adoption unlikely to dent air travel demand
- The levy comes as Singapore mandates a proportionate increase of sustainable aviation fuel used by airlines over the next few years
- For a short-haul flight to a destination such as Bangkok, the levy is expected to cost US$2.23 for an economy-class fare, an analyst says
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Singapore’s plan to impose a flight levy linked to the transition to green aviation fuels is unlikely to hurt the region’s post-pandemic air travel recovery despite causing a modest increase in ticket prices, analysts say.
Singapore recently announced that all flights departing the city state would need to use 1 per cent sustainable aviation fuel (SAF) starting in 2026 and aims to raise that to 3-5 per cent by 2030, subject to the availability and adoption of SAF globally.
The levy will be set based on the volume of SAF needed to achieve the targets and projected prices of the fuel. Singapore plans to impose the levy from 2026, according to The Straits Times.
Air ticket prices are expected to rise modestly due to the levy and this would ensure predictability for both airlines and travellers, said Mayur Patel, head of Asia at travel data provider OAG.
For economy class flights from Singapore, the levy is projected to cost around S$3 (US$2.23) for a short-haul destination such as Bangkok, S$6 for a medium-haul destination such as Tokyo and S$16 for a long-haul destination such as London, Patel said.
“These charges are for a sustainable future and [cost] less than a cup of coffee or meal at the airport,” he added.
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