Bangchak Leads Thailand’s Energy towards Country’s First Sustainable Aviation Fuel (SAF) Production 

The world has now entered a state of “Global boiling” due to rapid and severe climate change, driven by greenhouse gas emissions, the burning of fossil fuels, and disruptions to natural ecosystems. The aviation industry, a significant contributor to atmospheric greenhouse gas emissions, aims to achieve Net Zero but faces greater challenges compared to other industries in transitioning to clean energy. A viable solution lies in the development of Sustainable Aviation Fuel (SAF). Bangchak Corporation Public Company Limited has taken the lead by being the first in Thailand to produce SAF, aiming to significantly reduce carbon emissions. 

Advancing the Sustainable Aviation Fuel Business 

Mr. Suraporn Petchdee, General Manager of BSGF Company Limited (BSGF), revealed that as a producer of Sustainable Aviation Fuel (SAF), the primary raw material used in production is used cooking oil (UCO). Additionally, SAF can also be made from other types of waste oil. All raw materials are sourced, produced, and distributed under ISCC certification standards. The choice to use waste oil as the main feedstock clearly addresses sustainability concerns. Currently, the public consumes about 3-4 million liters of vegetable oil per day. If roughly 30-40% or around 1 million liters—can be collected, which seems feasible, the company plans to design a SAF production unit with a capacity of 1 million liters per day. At present, about 50-60% of the required oil can be collected. BSGF has partnered with Bangchak Corporation Public Company Limited, BBGI Public Company Limited, and Thanachok Vegetable Oil (2012) Company Limited, its major shareholders, to communicate and promote awareness about the benefits of collecting used cooking oil for SAF production. 

When preserving raw materials after collection, it is initially essential to assess the properties of the used cooking oil (UCO). These properties must align with its source. UCO from large-scale food industries is usually well-regulated, with quality control measures in place and accompanied by test results or a Certificate of Analysis (COA). On the other hand, UCO collected from small vendors or households tends to have more variable quality. 

Promoting Alternative Raw Materials to Support Thailand’s Agricultural Sector 

In the future, if it is found that the supply of UCO is insufficient to meet the demand for SAF in Thailand, the government will consider the possibility of allowing crude palm oil to be used as a feedstock. However, it would first need to receive certification from the ISCC, as the ISCC currently prohibits the use of crude palm oil due to potential negative impacts on the entire food supply chain, particularly since palm oil production in Europe is limited. Nonetheless, since Thailand has an abundant supply of palm oil, there is a possibility that the country could receive an exemption to produce SAF from crude palm oil. This would also help promote the domestic agricultural sector. 

Moreover, using SAF can reduce carbon dioxide emissions by up to 80%, while also providing various other benefits. Environmentally, it helps prevent UCO from being discarded into the ecosystem, where it can combine with waste to form fatbergs, clogging drainage systems and increasing the risk of flooding. In terms of health, it reduces the reuse of cooking oil, which in turn lowers health risks for consumers, such as clogged arteries and cancer. Economically, it also creates an additional source of income for the public through the sale of UCO.  

It is evident that the benefits mentioned align with the BCG (Bio-Circular-Green) Model, which promotes holistic economic development by focusing on three key economies: Bioeconomy, Circular Economy, and Green Economy. This approach will undoubtedly enhance Thailand’s competitiveness on the global stage.  

SAF Market Competition  

The current Sustainable Aviation Fuel (SAF) market still faces many concerns, but it is expected to improve in the long term. Thailand has announced a policy to increase the SAF blending ratio to 1% by 2026, with demand projected to grow steadily as the blending percentage rises according to the set plan. This trend is further supported by similar plans announced by many other countries. At present, competition is emerging as everyone is striving to produce SAF, which is expected to increase supply. However, initial supply may outpace demand. In the future, as global awareness of environmental issues grows and the transition to Carbon Neutrality and Net Zero becomes a priority, demand for SAF will rise. SAF is particularly well-suited to meet the needs of the aviation sector. At the same time, challenges related to feedstock availability will arise. If the global SAF supply depends primarily on used cooking oil (UCO), the quantity may not be sufficient. However, increasing the consumption of fried oil to boost supply would conflict with public health objectives.  

 Another aspect of competition is price. SAF is more expensive than conventional jet fuel, which could lead to higher ticket prices for consumers due to the advanced technology and high production costs. However, if government support, such as subsidies or financial assistance, is provided, it can help prevent the burden from being passed on to consumers. 

SAF Plan for 2025 

Currently, Bangchak Corporation Public Company Limited and BSGF Company Limited are constructing a SAF production plant, which is expected to be completed by the first quarter of 2025. Once completed, SAF products will be available to consumers. The target customers will include both domestic and international airlines interested in using SAF. Any surplus after domestic sales will be exported to international markets. BSGF’s SAF production process involves Thanachok Vegetable Oil (2012) Company Limited, which supplies the feedstock for production. Once the production process is completed, the fuel will be transported by Bangkok Fuel Pipeline and Logistics Company Limited – BFPL through its pipeline system, which connects to Don Mueang International Airport (DMK) and Suvarnabhumi International Airports (BKK). 

It can be said that many sectors are becoming increasingly aware of the rapid changes in the environment, prompting every industry to accelerate efforts to mitigate the impacts. This includes the aviation industry. In 2021, the International Air Transport Association (IATA) announced its “Fly Net Zero” commitment, a collective goal for airlines worldwide to achieve net-zero greenhouse gas emissions by 2050. BSGF is prepared to expand its production capacity to meet the growing demand for SAF, supporting the aviation industry’s efforts to reduce carbon dioxide emissions. SAF can reduce carbon emissions by approximately 80% compared to conventional aviation fuel. BSGF primarily uses UCO (Used Cooking Oil) as its main feedstock for production while actively exploring alternative solutions in case the primary feedstock supply becomes insufficient.