India's Kitchen Waste Becomes Jet Fuel as SAF Mandate Nears

From January, every international flight departing India must burn fuel containing 1% sustainable aviation fuel, and the waste cooking oil that fills tubs in Bengaluru restaurant basements is now the cheapest feedstock to meet it. India's state refiners are already bidding: Hindustan Petroleum and Bharat Petroleum have sought a combined 83,000 tons of used cooking oil in tenders closing this month, on top of a smaller Indian Oil tender earlier this year.

Together, Indian Oil, Hindustan Petroleum and Bharat Petroleum want tens of thousands of tons of the material, and assembling industrial quantities means collecting it from thousands of scattered eateries one sticky container at a time.

"The market is way, way bigger than all of us can provide for," said Mannan Khan, CEO of M11 Energy Transition, one of roughly a dozen licensed aggregators in India. In 2022 his company had one collector carrying jerry cans. This year it fields 300 collectors across 24 cities, gathering about 1,000 tons a month. Khan plans to double his depots to 50 by year-end and add households, food manufacturers and industrial kitchens to his routes.

Why India is moving fast

The push tracks a hard vulnerability: India imports about 90% of its crude and has spent a record $125 billion on those imports so far this year. The war between the US and Iran disrupted shipments through the Strait of Hormuz and sent prices surging, sharpening the case for homegrown fuel.

"Hormuz triggered the alarm," said Sanjay Sah, Deloitte South Asia's lead for energy and resources, noting the government has had to move fast to cut imports. Prime Minister Narendra Modi's administration is promoting fuel from urban, industrial and agricultural waste, with the SAF mandate rising to 5% by 2030 alongside a 5% biodiesel target for road transport.

India is joining a wider Asian push. Singapore and South Korea plan requirements from 2027; collection networks are expanding in Malaysia, Vietnam and Indonesia; China already ships large volumes of used cooking oil to the US, Europe and Singapore.

How big is the demand?

Global SAF demand is expected to soar 600% over a decade to 14 million tons by 2035, according to Argus Biofuels Analytics, with Asia a major driver, said the agency's principal biofuels consultant, Jonty Richardson. S&P Global puts India's demand alone at 250,000 tons by the end of the decade.

Supply, though, is tight. SAF accounted for just 0.6% of total jet fuel used last year, according to IATA, which expects only gradual growth.

Can the supply chain deliver?

The numbers expose the gap. India produces about 3 million tons of used oil a year, but only about 5% is collected, according to India's SAF Association. An estimated 60% flows back into the food chain — illegal and unhealthy — while the rest sits in basements, hotel kitchens and food factories.

Fraud is the second problem. Waste oil sometimes trades above fresh oil, creating incentives to pass off virgin vegetable oil as kitchen leftovers. Ahead of the EU's SAF mandate last year, European biodiesel groups questioned some Asian shipments; Asian producers disputed the allegations while calling for stricter traceability. Tracing oil in a fragmented market is difficult without coordinated government and industry action, Sah said.

"It is not easy to be an organized player in a highly unorganized market," said Jatin Udwadia, head of trading at Munzer Bharat, which collects about 900 tons a month across more than 20 Indian cities. "India's SAF mandate is an ambitious move and all the more reason for organized players to step in and help India fulfill it." Munzer Bioindustrie, an Austrian biodiesel producer exporting UCO from India for a decade, now has proposals from refiners to co-produce biofuels.

Prices already reflect the competition. Benchmark seaborne Asian UCO prices are up about 10% this year after hitting a record in May, according to Argus Media, which expects "a steady incline over the next decade." M11's Bengaluru depot receives about four tons a day; its oil currently moves to Germany via Rotterdam and to Texas and California ports, but increasingly will feed refineries at Padubidri and Paradip before reaching aircraft departing Delhi and Mumbai.