U.S. makes a ‘thimbleful’ of clean jet fuel. That’s changing.

Source: By ANDRES PICON, E&E News • Posted: Sunday, August 14, 2022

New tax credits for sustainable aviation fuel are expected to boost production and increase demand for the renewables.

Biofuel producers and aviation industry groups are celebrating tax credits for sustainable jet fuel in the Senate climate bill as an early victory for cleaning up air travel.

The incentives for sustainable aviation fuel (SAF) stand to accelerate the slow process of decarbonizing the aviation sector. Unlike most ground transportation, airplanes cannot be easily electrified, so the industry is banking on lower-carbon fuels becoming more available and more affordable.

Since biodiesel tax credits were first established in 2005, lawmakers have extended them by only a year or two each time they expired, creating uncertainty in the biofuels market, according to advocates. Industry groups repeatedly lobbied Congress to enact longer-term incentives for renewables such as sustainable aviation fuel.