Washington, DC, April 25, 2022 – Sustainable aviation fuel (SAF) is a proven and essential component of the aviation industry’s drive toward decarbonization, and federal tax policies such as a dedicated blender’s tax credit are necessary to spur investment in commercial-scale production of this vital next-generation fuel, a large group of stakeholders said in a recent letter to Congress.
SAF is widely considered to be a critical component of the aviation industry’s goal of net-zero carbon emissions by 2050, as it is a drop-in fuel that reduces lifecycle greenhouse gas emissions by up to 80% compared to conventional jet fuel.
However, the current SAF supply of 4.5 million gallons annually is insufficient and must be increased to 3 billion gallons by 2030, and 35 billion gallons by 2050 for the aviation sector to meets its aggressive sustainability goals.
Proposals supporting the tax credit have been issued by the Biden administration, as well as groups like the Business Aviation Coalition for Sustainable Aviation Fuel, which is supported by NBAA. Review the administration’s proposal.
Congressional lawmakers have also voiced support for a blender’s tax credit – the Sustainable Skies Act containing the provision has been introduced in the Senate (S.2263) and House of Representatives (H.R. 3440). Learn more about the Sustainable Skies Act.
In an April 22 letter, a broad coalition of close to 80 aviation stakeholders — from general aviation, airlines and cargo operators, clean-fuel producers, engine and aircraft manufacturers, airports, trade associations and think tanks — reached out to congressional leadership to redouble support for the tax credit and underscore the urgent need for legislation to catalyze the production of SAF.
“The SAF-specific blender’s tax credit of $1.50 to $2.00 per gallon that was introduced in the Sustainable Skies Act (H.R. 3440/S. 2263) would promote and accelerate investment in the nascent domestic SAF industry while upholding rigorous environmental standards and ensuring that fuels that achieve the greatest reduction in emissions are eligible for the greatest tax incentive,” the coalition explained.
“NBAA and the business aviation community have been at the forefront of the aviation industry’s drive to sustainability, and we believe that technologies like SAF, advanced air mobility and electric propulsion will be key to ensuring that business aviation is safe, secure and sustainable,” said NBAA President and CEO Ed Bolen. “This tax policy remains the most effective method to incentivize the production of SAF. NBAA is determined to work with all stakeholders to make a blender’s tax credit a reality.”
