WASHINGTON, D.C.— Growth Energy today praised a bipartisan letter signed by 16 senators calling on the U.S. Department of the Treasury to use the most accurate and up-to-date lifecycle analysis for calculating new tax credits for sustainable aviation fuel (SAF). Authored by Senator Tammy Duckworth (D-Ill.), the letter notes that “the certainty and reliability of a science-based, United States government-developed model” is vital to ensuring that American farmers can contribute to the aviation industry’s decarbonization.
“It would be climate malpractice to anchor our SAF ambitions to outdated models that disregard U.S. innovations in biofuel production and climate-smart agriculture,” said Emily Skor, CEO of Growth Energy. “With current technologies, farm-based feedstocks are the only sources of clean, renewable energy available in large enough volumes to deliver on our decarbonization goals. Fortunately, researchers at the U.S. Department of Energy (DoE) have developed the gold standard for lifecycle modeling, informed by the latest hard data on everything from indirect land use change to fertilizer inputs. Only with the best available science guiding incentives can we unlock the innovations and investments needed to meet this administration’s SAF Grand Challenge. We applaud Senator Duckworth and our other Senate champions for working to ensure U.S. SAF production isn’t grounded before it can ever take off.”
In their letter, the senators flag major flaws in the International Civil Aviation Organization (ICAO) model and urge adoption of the U.S. Department of Energy’s Greenhouse Gases, Regulated Emissions, and Energy Use in Technologies (GREET) model. Failure, they warn, “will not only prevent American farmers from contributing to a clean energy economy, but it will drastically delay adoption of promising low emission energy sources and force the aviation industry to miss an opportunity to eliminate millions of tons of carbon emissions in the coming years.”
For the full text of the Senate letter and a list of signers, click here.
Section 40B of the Internal Revenue Code is a two-year sustainable aviation fuel credit. Congress provides five years of SAF tax incentives split between two separate tax incentives. In 2023 and 2024, SAF will qualify for a standalone blenders credit (40B) if the fuel reduces lifecycle greenhouse gas emissions by at least 50 percent. The value of this credit is determined on a sliding scale, equal to $1.25 plus an additional $0.01 for each percentage point by which the lifecycle emissions reduction of such fuel exceeds 50 percent. Then, SAF incentives will become part of the 45Z clean fuel production tax credit from 2025 to 2027.