US biofuel producers urge Congress to review SAF’s tax credits

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by Marta Pacheco

Marta studied Political Science and Media & Journalism at the Catholic University of Portugal (UCP) and has developed her journalistic career working for the Portuguese newspapers Diário de Notícias, Correio da Manhā and media outlets in Brussels. She is a reporter for Travel Tomorrow, and is also engaged in delivering communications services and EU policy research for different consultancies in Brussels. A former Blue Book trainee of the European Commission, Marta has a keen interest in EU and global affairs, and experience in reporting and interpreting information. Whenever she can, Marta loves traveling, exploring nature and learning about regenerative agriculture. She is also quite enthusiastic about space ventures and the cosmos.

17 February 2022

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1. Methodology

Biofuel producers have urged the US Congress on 15 February to change the methodology used in the Build Back Better Act to account for life-cycle CO2 emissions in the production of lower-carbon aviation fuel. The existing text of the bill is based on parameters developed by the International Civil Aviation Organization. However, with the current accounting method, biofuel producers argue that a share of sustainable aviation fuel (SAF) from the tax credits would be disqualified.

Trying to reverse the legal blockage, signatories of a letter from biofuels makers said they want the legislation to use an accounting method known as the US Department of Energy’s GREET model, which they argue is updated to reflect innovations in biofuel production.

2. Build Back Better Act

Back in October 2021, US President Biden and Congressional leaders released a proposed Build Back Better Act that includes nearly 1 billion dollars to expand biofuels infrastructure.

The initiative envisions a four-year extension of the biodiesel tax credit, which was set to expire at the end of 2022, and a new tax credit to support the creation and usage of SAF, opening a new and growing market for biofuels and biodiesel.

Not only does the Build Back Better Act represent the largest investment in clean energy and combating climate change ever – it also confirms that my colleagues have listened to my central argument in our clean energy discussions: biofuels can and should be a part of our fight against climate change.
Cindy Axne, United States Representative, quoted by Biofuels Digest

Growth Energy’s CEO Emily Skor praised President Biden and Congressional leaders for including 1 billion dollars in biofuels infrastructure investments as part of the Build Back Better budget reconciliation framework.

3. Biofuel development

Recently, biofuel producers Marquis SAF and LanzaJet signed memorandum of understanding (MoU) to construct a 120 million gallons-per-year facility in the US to produce SAF and renewable diesel.

In October, Gevo and Archer-Daniels-Midland Company, another signatory of the letter sent to Congress, signed an MoU to produce about 500 million gallons of SAF and other renewable hydrocarbons.