Lawmakers in the Unites States are proposing a tax credit for sustainable aviation fuel (SAF), but fuel retailers are criticizing it, saying SAF is actually less efficient than renewable diesel and even produces more emissions.
The proposed bill would give a tax credit between $1.25 and $1.75 per gallon ( 3.8 litres), depending on the feedstock used, to SAF producers. The suggestion is included in a broader tax and climate bill intended to lower CO2 emissions in the US by 40% until 2030, reducing at the same time the federal budget deficit by $300 billion, Reuters reports. The SAF tax credit is expected to be applicable as soon as next week.
SAF cannot compete with other renewable fuels on an environmental basis.
David Fialkov, executive vice president of government affairs at NATSO
Fuel retailers have raised concerns over the effects of the SAF credit. They argue that it will lead to vegetable oil and feedstock being provided mainly for SAF production, leaving the renewable diesel producers with less, or without, materials. The National Association of Truckstop Operators (NATSO) and fuel marketers association SIGMA are asking for the new law to provide similar conditions for the biodiesel tax credit (BTC) and proposed SAF tax credit.
The other argument raised against the SAF credit is that SAF is in fact less efficient than renewable diesel. A study from LMC International revealed that, since producing SAF requires more feedstock per gallon than renewable diesel, its CO2 reduction properties are lower.
Increasing the global supply of vegetable oils, directly or indirectly, necessarily comes at the cost of forests and other natural lands.
International Council on Clean Transportation
Environmental activists have also raised concerns over the increased biofuel production. They “have argued that all biofuels that divert lipid-based feedstocks such as animal fats and waste cooking oils from existing markets present significant sustainability concerns”, Reuters reports.
The concerns over the impact on the environment of biofuel production is also shared in Europe. Last month, the European Parliament (EP) voted on the ReFuel EU initiative, clarifying from which materials SAF can be produced. Airlines and NGOs alike had been highlighting the importance of this clarification before the vote and welcomed the EP’s decision.
