Whitehouse introduces Sustainable Aviation Fuel Act

By Erin Voegele | May 17, 2021

Sen. Sheldon Whitehouse, D-R.I., on May 13 introduced the Sustainable Aviation Fuel Act, which aims to incentivize the production of sustainable aviation fuel (SAF), including the establishment of an aviation-only Low Carbon Fuel Standard. Companion legislation was introduced in the U.S. House of Representatives by Rep. Julia Brownley, D-Calif., on Feb. 3. Brownly also previously introduced the legislation in November 2020.

The bill, S. 1608, introduced by Whitehouse aims to create a grant program authorized at $1 billion over five years to expand the number of facilities producing SAF and build out the necessary supporting infrastructure.

It would also require the U.S. EPA to establish an aviation-only LCFS that regulates aviation fuel producers and importers. These parties would have to comply with a carbon intensity benchmark that declines each year.

In addition, the bill would require the U.S. Department of Defense to increase utilization of SAF to 10 percent beginning in fiscal year (FY) 2024, so long as the fuel is readily available and competitive with the cost of fossil jet fuel.

The legislation would also require the Federal Aviation Administration’s Center of Excellence for Alternative Jet fuels and the Environment to conduct additional research on ways to increase SAF fuel utilization in the aviation sector and the impact of aviation emissions on the climate crisis.

Another provision of the bill requires the U.S. Department of Energy, in consultation with the USDA, to research the use of cover crops for the production of SAF.

Finally, the bill includes tax credits to support SAF. It would establish a new blenders tax credit for SAF between $1.50 and $1.75 per gallon, depending on the fuel’s greenhouse gas (GHG) reduction. To prevent double dipping, SAF would no longer be eligible for the existing $1 per gallon biodiesel tax credit. The legislation also aims to expand the existing energy investment tax credit (ITC) to include SAF production facilities and related infrastructure. The credit would be set at 30 percent through 2026, and phase down to 24 percent in 2027, 18 percent in 2028, and 12 percent from 2029-2035, at which point the credit would fully phase out.

To date, Sen. Dianne Feinstein, D-Calif., has signed on to cosponsor Whitehouse’s bill. Brownley’s bill, H.R. 741, currently has nine cosponsors, including Reps. Kathy Castor, D-Fla.; Jared Huffman, D-Calif.; Doris Matsui, D-Calif.; Mike Levin, D-Calif.; Suzanne Bonamici, D-Ore.; Chellie Pingree, D-Maine; Bradley Scott Schneider, D-Ill.; Daniel Kildee, D-Mich.; and Del. Eleanor Holmes Norton, D-D.C.