Latvia to build first Baltic renewable fuel plant at Port of Riga

A renewable fuel production facility for hydrotreated vegetable oil (HVO) and sustainable aviation fuel (SAF) is set to be established at the Port of Riga, Latvia, making it the first of its kind in the Baltics, the port announced on Tuesday November 26

The total project cost is estimated at €120 million ($126 million) and is led by Latvian logistics and transport company Sia Pars Terminals in partnership with Ukrainian investors.

Located in Kundziņsala, the facility will have the capacity to process 236,000 tonnes per year of raw materials, producing 93,000 tonnes of HVO and 87,000 tonnes of SAF.

Construction is expected to be completed in 20 months, with all required equipment and technologies already in place, the port said.

The plant will use vegetable oils as the main raw material for the production of the renewable fuels.

Latvia’s aviation sector, including its national carrier airBaltic, stands to gain significantly from the project.

“[The facility] would bring immediate, significant economic benefits, especially after 2030, when at least 20% of the fuel consumed in aviation will have to be renewable,” Armands Sadauskis, owner of Sia Pars Terminals, said.

Fastmarkets’ senior analyst, Tore Alden, answers six key questions on the challenges faced by the sustainable aviation fuel industry. Watch the full interview here.

Alignment with regulations

This agreement aligns with the EU’s ReFuelEU Aviation Regulation, which has set progressive targets for SAF usage. Starting at 2% by 2025, the target increases to 70% by 2050.

This development also aligns with a broader initiative by the Latvian Ministry of Transport to evaluate SAF production potential in Latvia and Estonia.

Launched in July 2024, the 16-month project aims to identify optimal policy frameworks and technological solutions for SAF production.

The initiative includes interviews with policymakers and industry representatives, country-specific assessments of SAF technologies, and recommendations to enhance competitiveness in the SAF industry, the Latvian ministry said in a statement in October.

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