India could position itself among the world’s most competitive producers of sustainable aviation fuel (SAF) by combining low-cost solar power with abundant agricultural residue, potentially producing the fuel at costs up to 40 percent lower than global benchmarks, according to a new study.
The report, India’s Aviation Opportunity: Turning Agricultural Residue and Low-Cost Solar into Competitive Sustainable Aviation Fuel with Power-and-Biomass-to-Liquids, released by the India Energy & Climate Center (IECC) at UC Berkeley and Energy Innovation, identifies India as one of the few countries with the resource base required for large-scale SAF production, Saur Energy reported.
According to the study, India’s advantage lies in the availability of surplus agricultural residue and access to some of the world’s lowest-cost renewable electricity, which can support green hydrogen production.
The findings come as aviation markets across Europe, the United Kingdom, the Middle East and Asia-Pacific increase requirements for the use of sustainable aviation fuel while global production remains below anticipated demand.
The report estimates that supplying one-fourth of global SAF demand could create an annual export opportunity worth around USD 9 billion for India by 2030, with the potential to expand to nearly USD 30 billion by 2040.
Researchers highlighted the power-and-biomass-to-liquids (PBtL) pathway as a promising route for domestic production. The process combines agricultural residues such as rice straw and wheat straw with green hydrogen generated using renewable electricity.
The combined feedstock is converted into synthesis gas and further processed into liquid fuels, including aviation fuel compatible with existing aircraft systems.
Beyond export potential, the study points to wider strategic gains for India. Developing domestic SAF capacity could help reduce dependence on imported crude oil and lower exposure to volatility in aviation fuel prices, particularly during periods of geopolitical uncertainty in West Asia.
The report also suggests that expanding SAF production could support efforts to address crop-residue burning in northern India by creating an alternative commercial use for agricultural waste.
For early deployment, the study identifies areas around Delhi, Mumbai and Pune airports as suitable locations for initial PBtL projects.
To accelerate development, the report recommends policy measures including concessional financing, viability-gap support for green hydrogen projects and targeted incentives for fuels produced using agricultural residue and renewable energy.
