Grand Challenge and Federal Legislation Seek to Advance Sustainable Aviation Fuels -- Part 2 in a Series, "Sustainable Aviation Fuels: A Critical Emissions Mitigation Strategy Gaining Momentum"

by Jeff Overton (Environmental and Energy Study Institute) ... The Biden-Harris Administration and Congress are focusing on expanding the use of sustainable aviation fuel (SAF) through multi-agency coordination to reduce climate emissions from aviation....

On September 9, 2021, the Biden-Harris Administration unveiled the Sustainable Aviation Fuel Grand Challenge (the Grand Challenge) to boost SAF production and deployment through coordination across multiple federal agencies, fuel producers, airlines, airports, and aircraft manufacturers.

The goals of the Grand Challenge are to produce three billion gallons of SAF per year by 2030 and reduce aviation emissions 20 percent in the same timeframe. New and existing funding supporting SAF production will total $4.3 billion.

The White House Fact Sheet describing the role of federal agencies in the administration’s SAF plan and a Memorandum of Understanding (MOU) between the Departments of Energy, Transportation, and Agriculture outline strategies to increase SAF production, including:

Department of Defense (DOD) funding, subject to appropriations, is targeted to certify four existing SAF pathways for the more rigorous standards of military use, helping to expand overall demand. To support more sustainable government employee travel, the General Services Administration (GSA) will publish a request for information about airline sustainability strategies to inform the best choices for federal travel needs.

There are four bills before Congress designed to encourage SAF production and use: H.R.741 and its Senate companion S.1608; and S.2263 with its House companion H.R.3440. EESI reported on the content of H.R.741 (the Sustainable Aviation Fuel Act) when it was first introduced in the 116 ^th Congress as H.R.8769; it has been reintroduced in the current session. The Act, authored by Rep. Julia Brownley (D-Calif.), would provide directed research and grant funding for SAF supply chain development and establish an aviation-only low carbon fuel standard. The proposed standard would mandate a 20 percent less carbon-intense fuel market compared to 2005 by 2030, and a 50 percent less carbon intense market by 2050.

H.R.741 also contains a tax credit provision that is the primary initiative of S.2263 (the Sustainable Skies Act). This “blenders tax credit” would help lower the production cost of SAF by providing a credit of at least $1.50 per gallon for sustainable fuel that reduces carbon intensity by 50 percent compared to conventional fuel. The credit scales up to $2.00 ($1.75 in H.R.741) as the carbon reduction reaches 100 percent. This credit would help reduce the costs of SAF, making it more competitive with conventional jet fuel, and would level the playing field for sustainable aviation fuel competing with renewable diesel for feedstock and refinery capacity.

In his 2022 fiscal budget, President Biden proposed $6.6 billion for SAF tax incentives from 2022 to 2031.

The European Union’s governing body, the European Commission (EC), is considering an alternative approach to advance the SAF industry in a proposed regulation called ReFuelEU Aviation, which was introduced in July 2021. The regulation would require fuel suppliers that deliver jet fuel to EU airports to include SAF in the fuel they provide. READ MORE