The regenerative advantage: Sustainable Aviation Fuel and the new power geography of the Indo-Pacific
In a world where strategic advantage has historically flowed from the control of finite resources, the future may belong to those capable of continually regenerating them.
Daniel Bloch
Director, Strategic Partnerships
LanzaJet
13 August 2026
Key takeaways
The global energy transition is often characterised as a story of declining fuel demand. As large segments of the economy electrify, it is easy to assume that liquid fuels will become progressively less important over time. In reality, the opposite dynamic is beginning to emerge. Whilst electrification will reduce fuel demand, it will not eliminate the need for liquid fuels altogether. Instead, it will concentrate demand into a smaller group of sectors where alternatives remain fundamentally limited, including aviation, maritime, defence, and portions of heavy industry.
Given the sectors that remain dependent on liquid fuels are the ones that underpin global trade, mobility, defence, and economic connectivity, countries that can reliably produce and supply fuel in the future will hold an increasing economic, strategic, and soft power advantage. In recent times, geopolitical tensions and acute fuel shortages have illustrated the vulnerability of global fuel supplies. For example, the shocks triggered by Russia’s invasion of Ukraine, along with disruptions through the Strait of Hormuz and repeated attacks on commercial vessels in the Red Sea, demonstrate that fuel supply chains remain exposed to geopolitical conflict and geographical chokepoints.
In the Indo-Pacific, that makes future fuel supply a question of resilience and security, as much as one of trade and mobility. Renewable fuels, such as Sustainable Aviation Fuel (SAF), offer a more structurally resilient alternative to traditional fossil fuels, and ample opportunity for Australian leadership in the sector.
The energy transition is concentrating fuel demand
Recent disruptions to global energy markets have demonstrated how vulnerable our modern economies remain to geographically concentrated supply chains. Whilst public attention typically focuses on price volatility, the deeper issue is one of dependence. Aviation, shipping, and trade continue to rely upon fuel systems shaped by geopolitical forces beyond their control.
Meanwhile, demand for liquid fuels is declining in other parts of the economy – electric vehicles alone are projected to displace more than 5 million barrels of oil per day by 2030. In turn, the significance of the remaining fuel demand grows. Aviation cannot electrify commercial aircraft, just as maritime transport cannot abandon liquid fuels without significant technological change. As fossil fuels remain finite and their supply chains vulnerable, these sectors will increasingly compete for a smaller pool of strategically important fuels, making the security, diversity, and resilience of supply a defining challenge for the decades ahead.
SAF snapshot
Sustainable Aviation Fuel (SAF) is a jet fuel made from renewable feedstocks, such as agricultural and forestry waste, used cooking oil, sustainable crops, and municipal solid waste. Across the lifecycle of its production, SAF can considerably cut carbon emissions (industry average of around 80% reduction) when compared to conventional jet fuel, while remaining fully compatible with today’s aircraft and airport infrastructure.
↗ Global SAF production reached an estimated 2.4 million tonnes in 2026, representing around 1% of total jet fuel consumption.
↗ Demand is forecast to grow more than sixfold by 2030, to 12.8 million tonnes.
↗ To put aviation on a Net Zero by 2050 path, annual SAF supply needs to scale over 200x to around 500 million tonnes.
↗ A mature Australian low-carbon liquid fuels industry could be worth $36 billion and cut cumulative emissions by 230 million tonnes of CO2 by 2050.
Renewable fuels change the logic of energy security
In the aviation context, SAF offers a fundamentally different approach to the energy security challenge, as it changes the logic of fuel production itself. Conventional fuels derive their value from finite geological reserves that must be extracted, transported, and invariably, depleted. Renewable fuels can instead be produced from feedstocks that are continually replenished through biological and cyclical processes, including agricultural wastes and low-value by-products, forestry residues, municipal waste streams, and regenerative crops.
The significance of this shift extends beyond decarbonisation, as renewable fuels have the potential to reshape how countries think about energy security, supply chains, and resilience to disruptions. A renewable fuel system built upon diverse and locally available feedstocks is inherently more capable of reducing exposure to geopolitical concentration than one dependent on imported fossil fuels, which move through vast and vulnerable supply chains. Whilst no country will ever be entirely insulated from external shocks, renewable fuels create the possibility of a more diversified and domestically anchored energy architecture, which becomes less reliant on any single import corridor. This reduces exposure to the concentration risks that have historically defined global markets, not least aviation fuel.
A renewable fuel system built upon diverse and locally available feedstocks is inherently more capable of reducing exposure to geopolitical concentration
The Indo-Pacific’s feedstock advantage
The Indo-Pacific is often discussed through the lens of its energy vulnerabilities. Many countries in the region remain heavily dependent on imported fuels, whilst growing populations and expanding middle classes continue to drive rising demand for aviation, shipping, and regional connectivity. Yet, these same characteristics that are driving demand also point toward a longer-term opportunity, albeit one that requires time, sustained investment, policy support, and regional partnerships to be fully realised.
The Indo-Pacific generates municipal waste streams, agricultural residues, and organic by-products at volumes that dwarf those of many developed economies. Yet, these otherwise problematic resources are increasingly viewed and utilised as productive inputs for future fuel production, so long as they align with sustainable development objectives, avoid competition with food production, and meet the underlying environmental and social standards required by industry certification bodies. In many parts of Southeast Asia, waste management challenges, environmental degradation, and growing energy demand coexist in the same communities. Renewable fuel production offers a rare opportunity to address all three simultaneously, transforming waste into economic value, whilst strengthening local energy resilience.
Renewable fuel production offers a rare opportunity to […] [transform] waste into economic value, whilst strengthening local energy resilience.
Yet feedstock abundance does not automatically translate into fuel supply. Building the processing infrastructure, expertise, and certification frameworks needed to convert these resources into renewable fuels can take several years. Across much of the Indo-Pacific, those value chains are nascent, and aviation demand is growing faster than the domestic capacity to serve it with cleaner fuels. This creates a unique opportunity for regional cooperation, investment, and industrial development, including in Australia.
From a timing standpoint, Australia is not the only country eyeing this opportunity and the window to emerge as a regional leader in this space will not stay open indefinitely. Singapore, which has little domestic feedstock of its own, has moved fastest on policy, establishing a mandatory SAF levy from October 2026 that will fund a 1 per cent SAF uplift this year, rising to 3–5 per cent by 2030. Meanwhile, Japan has paired a SAF mandate for 2030 with its own domestic production incentives, South Korea’s 1 per cent blending requirements will take effect in 2027, and India will also introduce a 1 per cent mandate for international flights in 2027, scaling to 5 per cent by 2030.
However, most of these markets are natural importers, not producers. Singapore, Japan, and South Korea have limited domestic feedstock and are certain to rely on imported SAF to meet their targets, whilst Indonesia, the Philippines, Thailand, and Vietnam are better placed to become net exporters by the 2040s, based on the size of their agricultural sectors. Australia’s opportunity, in turn, is not to out-produce these latter markets on volume, but to become a reliable, geographically proximate supplier and technical partner to the region’s importers.
Western Australia’s role
Australia has a unique position within this emerging landscape, and Western Australia (WA) sits at the centre of this opportunity. The state’s abundant renewable energy resources, established export infrastructure, and geographic proximity to some of the world’s fastest-growing aviation markets – many of which lack the domestic infrastructure to convert their own feedstock resources – makes it well placed to help fill the Indo-Pacific’s emerging SAF supply gap. WA, and Australia more broadly, has the extensive agricultural capability, renewable energy resources, land availability, and export infrastructure needed to do so at scale. A mature Australian low-carbon liquid fuels industry could be worth $36 billion and cut cumulative emissions by 230 million tonnes of CO2 by 2050.
This combination of geography, urgency, and resource endowment is now attracting serious policy attention. The Australian Government’s $1.1 billion Cleaner Fuels Program, a 10-year production incentive for the domestic low carbon liquid fuels industry, signals a national commitment to the development of this industry. The 2026-27 Federal Budget went further still, by foreshadowing a local demand-side measure (e.g. a legally binding mandate for SAF supply at Australian airports). If ratified, this would provide revenue certainty for local SAF production, which remains one of the critical enablers for new developments to become bankable.
Closer to home, the Cook Government’s $1.2 million WA Advanced Biofuels Strategy, due for delivery in the second half of 2026, is mapping the state’s feedstock potential. As one might expect, Western Australia is home to a wide range of potential renewable inputs, spanning oat, wheat, and barley residues, regenerative woody biomass from mallees and blue gums, as well as canola feedstocks.
As demand for renewable fuels grows across the Indo-Pacific, especially through the operationalisation of SAF mandates across the region, Australia has the opportunity to become both an exporter and a capability partner. Specifically, there is an opportunity to share project development expertise, processing know-how, and value chain architecture to help unlock feedstock potential across the region. In doing so, renewable fuels, and the expertise required to develop them, may emerge as a meaningful source of Australian influence, strengthening regional relationships through resilience, knowledge sharing, and partnership, rather than dependency.
Renewable fuels, and the expertise required to develop them, may emerge as a meaningful source of Australian influence, strengthening regional relationships through resilience, knowledge sharing, and partnership, rather than dependency.
The regenerative advantage
Stepping back, the most important difference between fossil fuels and renewable fuels is that they reward fundamentally different behaviours. The former system has historically rewarded countries fortunate enough to sit atop concentrated reserves of oil. The emerging renewable fuel economy increasingly rewards those capable of maintaining the ecosystems, agricultural systems, and waste management networks that enable continual resource renewal.
Such ‘natural capital’ should therefore be recognised as a strategic asset, with soil productivity, water security, biodiversity, and landscape health all serving as critical inputs that directly influence future fuel production. The countries that recognise this relationship earliest will be best positioned to shape the next chapter of regional energy security. For Australia, realising that role will also be a function of policy design, which will need to align domestic supply obligations with export ambition, ensuring that its capacity to be a regional partner works in tandem with meeting its own local needs.
Nonetheless, Western Australia, and Australia more broadly, has the opportunity to help define a new model of resilience for the Indo-Pacific. In a world where strategic advantage has historically flowed from the control of finite resources, the future of energy security may increasingly belong to those capable of continually regenerating them.
About the author
Daniel Bloch is a renewable fuels strategist and former SAF Specialist at IATA. He is the Director, Strategic Partnerships at LanzaJet and Chairs the RSB Impact Claims Programme. Views expressed are his own.
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