Lucknow: The Uttar Pradesh Cabinet has approved the Uttar Pradesh Sustainable Aviation Fuel Manufacturing Promotion Policy-2026 to attract investment in sustainable aviation fuel (SAF) production, promote the use of agricultural residues and municipal waste, and create green employment opportunities, Hindustan Times reported.
The policy aims to position the state as a major SAF production hub while supporting emission reductions in the aviation sector and strengthening energy security.
It encourages the production of SAF using agricultural residues, municipal waste and non-edible oilseeds. By creating demand for these feedstocks, the policy also seeks to develop rural value chains and provide farmers with additional income opportunities.
Uttar Pradesh’s agricultural resources, including rice husk, wheat straw and sugarcane bagasse, offer potential feedstocks for SAF production. The state’s established sugarcane and ethanol industries could also support the development of second-generation biofuels and Alcohol-to-Jet technology, which converts alcohol such as ethanol into aviation fuel.
Under the policy, SAF manufacturing units will be classified according to investment size. Large units will involve investments ranging from ₹200 crore to ₹500 crore, while mega units will require ₹500 crore to ₹1,500 crore. Projects involving investments above ₹1,500 crore will be classified as ultra-mega units.
The incentives offered include stamp duty relief, exemption from land-use conversion charges and development fees, reimbursement of net state Goods and Services Tax (SGST), interest subsidies and a full exemption from electricity duty for up to 10 years. Eligible units will also receive skill development subsidies and reimbursement of patent registration fees.
The policy was approved at a Cabinet meeting chaired by Chief Minister Yogi Adityanath on Friday. The Cabinet cleared 39 proposals covering areas including industrial investment, agriculture, employment, technology, development and public welfare.
Finance Minister Suresh Khanna and Principal Secretary for IT and Electronics Alok Kumar III briefed the media on the decisions following the meeting.
