The U.S. ethanol industry is lobbying the Biden administration to ensure lower-carbon aviation fuel made from ethanol will qualify for subsidies under the Inflation Reduction Act (IRA), arguing such provisions are crucial to meeting U.S. climate goals.
The campaign reflects the ethanol industry’s desire to expand into aviation amid projections motor fuel demand will fall in the future due to better efficiency and the ascent of electric cars.
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The Biden administration is targeting at least 3 billion gallons (11.4 billion liters) of sustainable aviation fuel (SAF) production per year in the U.S. by 2030 as part of its broader push to fight climate change.
The SAF Problem
At issue is a requirement in the IRA package that SAF yields a 50% reduction in lifecycle emissions compared with petroleum-based jet fuel before it can qualify for a $1.25 tax credit.
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The ethanol industry is asking the administration to use a methodology to calculate emissions developed by the Department of Energy called GREET that shows ethanol to have a lighter carbon footprint as an SAF feedstock than does the methodology proscribed by IRA, which was developed by the International Civil Aviation Organization.
