Uttar Pradesh approves Sustainable Aviation Fuel incentive policy

The Uttar Pradesh government has approved the ‘Uttar Pradesh Sustainable Aviation Fuel (SAF) Manufacturing Incentive Policy-2026’ to establish the state as a major hub for SAF production. Chaired by Chief Minister Yogi Adityanath, the cabinet decision aims to reduce carbon emissions in the aviation sector, strengthen energy security, and encourage private investment and green job creation.

The policy leverages the state’s abundant agricultural residues, such as rice husk, wheat straw, and sugarcane bagasse, which can be converted into fuel through pyrolysis and gasification technologies. The Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA) has been designated as the nodal agency for the approval and distribution of financial incentives.

Investment categories for SAF units include ‘Large’ (200–500 crore INR), ‘Mega’ (500–1,500 crore INR), and ‘Ultra Mega’ (above 1,500 crore INR). The policy will remain in effect for five years from its implementation date or until a new policy is introduced.