Malaysia Aviation Group, the parent company of Malaysia Airlines, is considering whether to introduce a green tax on passengers to help cover the rising cost of sustainable aviation fuel (SAF), potentially adding to airfares.
Group chief Capt. Nasaruddin A. Bakar said Monday that the company was examining different options as airlines worldwide seek to reduce carbon emissions while facing high SAF prices and limited supplies.
“We are looking at all options,” Nasaruddin told The Associated Press on the sidelines of an aviation sustainability conference. He stressed that both passengers and airlines needed to be able to afford the transition to cleaner fuel.
Singapore, Malaysia’s neighbour, has already announced a government-mandated green aviation levy set to take effect in January 2027. Charges will vary according to destination and cabin class, making Singapore the first country to announce such a measure.
The aviation sector faces growing pressure to address its environmental impact as global air travel demand increases. The International Energy Agency estimates that aviation accounts for about 2.5% of annual global carbon emissions, while the UN-backed International Civil Aviation Organization has established a goal of achieving net-zero carbon emissions by 2050.
According to the aviation organisation, sustainable aviation fuel could reduce the industry's emissions by around 65%.
SAF is typically made from renewable materials, including used cooking oil, waste fats and agricultural residues. It can be blended with conventional jet fuel and used in existing aircraft without requiring changes to their engines.
However, its widespread adoption remains constrained by higher production costs, limited manufacturing capacity and restricted access to sustainable raw materials.
The International Air Transport Association estimates that SAF currently represents less than 1% of global jet fuel consumption, highlighting the scale of the challenge facing airlines as they work towards their emissions targets.
Source: Associated Press