New Bill To Incentivize SAF Expansion

 - November 24, 2020, 11:42 AM

California Democrat Julia Brownley introduced a bill to incentivize the increased production and use of sustainable aviation fuel (SAF). The Sustainable Aviation Fuel Act, H.R.8769, would establish a national goal for the U.S. aviation sector to achieve a net 35 percent reduction in greenhouse gas (GHG) emissions by 2035 and net zero emissions by 2050 and, to get there, would use a mix of regulatory requirements, tax credits, research funding, and grants for the production, transport, blending, and storage of SAF.

H.R.8769 calls on the Environmental Protection Agency to establish an aviation-only low-carbon aviation fuel standard regulating fuel producers and importers. The EPA would be required to set annual benchmarks that culminated in a 20 percent reduction in carbon intensity by 2030 and 50 percent by 2050.

The bill would have the FAA create a program to offer competitive grants and cost-sharing agreements to incentivize the expansion of facilities producing SAF and support the development of the necessary infrastructure. This provision would set aside $1 billion over five years for the program. In addition, H.R.8769 would authorize $175 million over five years for research on ways to increase SAF use and to eliminate GHG emissions.

Further, a new blender’s tax credit for use of sustainability material in the production of SAF would be established and offered on a sliding scale. For SAF that reduces GHGs by 50 percent compared to fossil jet fuel, the tax credit would be $1.50 per gallon credit. That goes up to $1.75 per gallon for SAF that reduces GHGs by 100 percent.

“Aviation alone contributes 9 percent to U.S. greenhouse gas emissions from the transportation sector and is therefore a critical target toward achieving our climate goals. Sustainable aviation fuel will go a long way to reducing aviation sector greenhouse gas emissions, but it needs a focused federal response to make it a reality,” said Brownley, who is a member of both the House aviation subcommittee and the House Select Committee on the Climate Crisis.