Financing sustainable aviation fuel in Indonesia: Stakeholder perspectives on green premium allocation

This is the authors' abstract. We don't add key points for this paper.

Financing sustainable aviation fuel (SAF) requires arrangements through which stakeholders can meet its additional costs. The feasibility of these arrangements depends partly on the conditions stakeholders attach to participation. This study examined these conditions through interviews with 45 participants in Indonesia and international policy-representation settings between September 2025 and June 2026. Interview coding produced 2,830 entries across six research dimensions, including 609 economic entries, from which 268 entries concerning SAF financing and its implementation context were selected and audited by the author. Producers sought assurance that their fuel would be purchased, while airlines emphasized arrangements for recovering additional expenditure. Passenger acceptance depended on purchasing power, family travel costs, and whether journeys were paid for personally or through an employer. Proposals for tax or service-fee relief raised questions about the authority and resources of the institution providing support. Upstream accounts distinguished feedstock and logistics expenditure from investment in facilities, while reported differences between cargo and passenger markets qualified expectations of cost recovery. These findings clarify which decisions need to be made, and by whom, for proposed SAF financing arrangements to operate. Initial exposure, absorption, pass-through, and policy redistribution provide analytical questions rather than an observed sequence; the study does not estimate ultimate economic incidence or optimal contribution shares. Based on the findings, we suggest that appraisal of Indonesia’s voluntary green fares, organizational travel procurement, temporary support, and levy proposals should specify the expenditure covered, the authorized payer, the funding source, and responsibility for any remaining premium.