Reps. Sharice Davids, D-Kan.; Mike Flood, R-Neb.; Troy Carter, D-La.; and Tracey Mann, R-Kan., on Dec. 9 introduced legislation that aims to reinstate the 45Z clean fuel production credit premium for sustainable aviation fuel (SAF) and extend the 45Z credit through 2033.The original 45Z tax credit, as established by the Inflation Reduction Act of 2022, provided a tax credit for the production and sale of low-emission transformation fuels. The credit started at 20 cents per gallon for non-aviation fuels and 35 cents per gallon for sustainable aviation fuel (SAF). For facilities that satisfy the prevailing wage and apprenticeship requirements, the value of the tax credit was up to $1 per gallon for non-aviation fuels and $1.75 per gallon for SAF. Under the IRA, the 45Z credit was available for 2025, 2026 and 2027.&nbsp;President Trump on July 4 signed the One Big Beautiful Bill Act, a budget reconciliation package that extended the 45Z credit through the end of 2029, altered the credit by limiting eligibility to fuels derived from feedstocks produced or grown in the U.S., Canada or Mexico, and eliminated the “special rate” for SAF. The elimination of the “special rate” effectively caps the value of the SAF credit at $1 per gallon starting in 2026.&nbsp;The Securing America’s Fuels (SAF) Act introduced by Davids, Flood, Carter and Mann on Dec. 9 aims to reinstate the SAF bonus credit, allowing qualifying SAF producers to claim a credit of up to $1.75 per gallon.&nbsp;The legislation would also extend the 45Z credit for an additional four years, through 2033, providing long-term stability for the growing clean fuels industry.&nbsp;The SAF Act is not the only legislation introduced in recent months to reinstate 45Z's special rate for SAF. In October, Rep. Mike Thompson, D-Calif., <a href="https://biomassmagazine.com/articles/bill-aims-to-reinstate-45z-special-rate-for-saf-other-renewable-energy-tax-incentives-eliminated-by-obbb">introduced</a> a bill that aims to reinstate many of the renewable energy tax credits eliminated by the OBBBA. One provision of that bill aims to reinstate the 45Z credit premium for SAF.&nbsp;The bipartisan SAF Act is endorsed by major industry and agricultural groups, including&nbsp;National Corn Growers Association, SAF Coalition, Airlines for America, Kansas Farm Bureau, Renew Kansas, Kansas Corn, Kansas Soybean Association, Greater New Orleans Inc., Nebraska Corn Growers Association, Nebraska Soybean Association, Nebraska Farm Bureau, Twelve, Darling Ingredients, Louisiana Farm Bureau Foundation, Advanced Biofuels Association, Global Business Travel Association, and American Sugarcane League.“The SAF Coalition applauds Reps. Sharice Davids and Mike Flood for their leadership in introducing The Securing America’s Fuels Act,” said&nbsp;Alison Graab,&nbsp;executive director, SAF Coalition. “This legislation continues the broad, bipartisan support for SAF in Congress and recognizes SAF’s unique ability to fuel America’s energy dominance while supporting American farmers. The SAF Coalition urges Congress to pass this legislation so we can grow America’s rural economies, create new markets for our farmers and secure a stronger energy future for our nation.”“The Advanced Biofuels Association strongly supports this bipartisan effort to strengthen sustainable aviation fuel (SAF) producers and improve the overall availability of renewable fuels for America’s airline industry,” said Michael McAdams, president of the Advanced Biofuels Association. “This type of legislation is essential in the United States’ effort to achieve its energy dominance policy agenda.

2025-12-10 - SAF Act aims to extend 45Z credit, reinstate SAF premium  (4 publications)

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Reps. Sharice Davids, D-Kan.; Mike Flood, R-Neb.; Troy Carter, D-La.; and Tracey Mann, R-Kan., on Dec. 9 introduced legislation that aims to reinstate the 45Z clean fuel production credit premium for SAF and extend the 45Z credit through 2033.

SAF Act aims to extend 45Z credit, reinstate SAF premium

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