Letter from Congress Highlights Need for SAF Mixer Tax Credit | International magazine for biofuels
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April 27, 2022
A coalition of nearly 80 aviation stakeholders — from general aviation, airlines and cargo operators, clean fuel producers, engine and aircraft manufacturers, airports, trade associations and think tanks — has sent a letter to Congress leaders to redouble support for SAF tax credits.
They also wanted to underscore the urgent need for legislation to encourage the production of Sustainable Aviation Fuel (SAF).
The coalition argued that SAF is a proven and essential part of the aviation industry’s decarbonization push and that federal tax policies, such as a special blender tax credit, are needed to spur investment in the commercial production of this next-generation fuel.
SAF is widely recognized as a critical component to the airline industry’s goal of net-zero carbon emissions by 2050, as it is a drop-in fuel that reduces life-cycle greenhouse gas emissions compared to traditional jet fuel up to 80% reduced.
However, the current SAF supply of 4.5 million gallons per year is insufficient and needs to be increased to 3 billion gallons by 2030 and 35 billion gallons by 2050 for the aviation sector to meet its aggressive sustainability goals.
Proposals to support the tax credit have been issued by the Biden administration, as well as groups such as the Business Aviation Coalition for Sustainable Aviation Fuel, which is supported by NBAA.
Congressional lawmakers have also voted in favor of a blender tax credit — the Sustainable Skies Act, which includes the provision, has been introduced in the Senate and House of Representatives.
“Introduced with the Sustainable Skies Act, the SAF-specific Blender’s Tax Credit will encourage and accelerate investment in the burgeoning domestic SAF industry, while maintaining strict environmental standards and ensuring that fuels that achieve the greatest reduction in emissions are used for the greatest tax stimulus are eligible,” the coalition explained.
“The NBAA and the business aviation community are at the forefront of the aviation industry’s sustainability efforts, and we believe technologies such as SAF, advanced air mobility and electric propulsion will be key to ensuring business aviation is safe and sustainable,” said NBAA President and CEO Ed Bolen.
“This tax policy remains the most effective way to incentivize the production of SAF. The NBAA is committed to working with all stakeholders to make the Blender Tax Credit a reality.”
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