As APEC leaders convene, the Asia Pacific region faces twin imperatives that demand coordinated action. Climate commitments will require deep decarbonisation across transport and industrial sectors while energy security concerns necessitate reduced dependence on volatile fossil fuel trade flows. Low carbon liquid fuels (LCLF) offer a rare solution that addresses both challenges simultaneously, creating an US$800 billion market opportunity across the region.¹

The scale of this challenge becomes clear when examining the hard-to-electrify backbone of regional trade. Aviation, maritime transport, heavy freight, and industrial processes form the circulatory system of the Asia Pacific's interconnected economies. These sectors move the goods and people underpinning regional prosperity yet face fundamental physical constraints that make electrification commercially unviable. Energy density requirements, weight limitations, and operational demands create an inescapable reality: these backbone industries need liquid fuel solutions to decarbonise.

These applications account for nearly half of liquid fuel consumption across major regional economies. With aviation demand growing 2.6% annually and freight at 1.9%², the challenge compounds without coordinated intervention - this is precisely why LCLFs emerge as the critical market catalyst.

Policymakers across the Asia Pacific are coming to terms with this reality and acting on it in an increasingly decisive manner. Deloitte’s SAF Lighthouse tool provides airport-level demand forecasting, revealing where Sustainable Aviation Fuel (SAF) is likely to take off, driven by emerging mandates. This, paired with the current pipeline of SAF projects under development, and volumes of competitive feedstock available, make clear that there is a significant opportunity for the region. 

However, realising this potential requires overcoming significant investment barriers. Our analysis in the Refined Ambitions report for Australia’s Clean Energy Finance Corporation identifies five interconnected risks constraining private capital: demand uncertainty without harmonised policy, price volatility in fragmented markets, feedstock supply risks, technology risks beyond proven pathways, and policy uncertainty from inconsistent standards. These barriers persist across both developed and emerging regional economies, creating a coordination problem that no single jurisdiction can solve alone.

Understanding market development phases reveals why coordinated action creates competitive advantages. Four distinct stages characterise this evolution: export-led growth, domestic demand emergence, supply diversification, and consolidation. Companies securing partnerships during earlier phases capture disproportionate value as markets mature. Critically, competition between production pathways and feedstock supply is expected to reduce abatement cost significantly, making regional coordination not just strategically smart but economically essential.

The Refined Ambitions report points toward seven specific accelerators that can unlock investment barriers through coordinated regional action:

1. Increase market access - harmonise sustainability standards and trade frameworks
2. Increase risk mitigants - develop revenue certainty mechanisms and concessional finance
3. Reduce transaction frictions - standardise contract terms and regulatory processes
4. Send credible demand signals - coordinate policy and government procurement
5. Reduce information asymmetry - publish market benchmarks and supply/demand forecasts
6. Leverage innovation - coordinate R&D investments and technology deployment
7. Align value chain interests - facilitate partnerships and joint ventures

As outlined in Deloitte’s recent report, Accelerating Net-Zero: Critical Opportunities in Asia Pacific’s Climate Policy, the strategic imperative for regional leaders is clear – the only way to catalyse real change, at pace, regionally, is for policy to lay the groundwork for action, matched with private sector investment and innovation. APEC provides the coordination platform, but individual C-suite decisions across aviation, shipping, heavy industry, and fuel production will ultimately determine outcomes. The window for establishing regional partnerships narrows as other markets move decisively toward integrated approaches. In Deloitte’s recent 2025 CxO Sustainability Report, almost 50% of Asia Pacific C-suite surveyed noted that they are focused on developing new sustainability related products and services and actively implementing new technology solutions. SAF provides a key opportunity for these organisations. 

Companies building regional low carbon liquid fuel capabilities now position themselves advantageously for the consolidation phase that inevitably follows market maturation. Those choosing fragmented national strategies risk higher costs, supply constraints, and competitive disadvantages as integrated regional ecosystems develop economies of scale and regulatory alignment.

The groundwork laid through APEC coordination will determine whether Asia Pacific leads global low carbon liquid fuel development or cedes first-mover advantages to regions already acting decisively on both climate and security imperatives.

The choice facing regional leaders is fundamental: build these capabilities together through coordinated partnerships or explain later why fragmentation was chosen when the stakes demanded integration and the pathway to success was clear. 

To find out more, please reach out to Deloitte Asia Pacific's Sustainability Leader Will Symons.