White House announces plan to substantially expand introduction of sustainable aviation fuel

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Transportation Alert

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On September 9, 2021, the Biden Administration released a statement entitled “Biden Administration Advances the Future of Sustainable Fuels in American Aviation.”

The fact sheet, available here, details a new initiative from the White House to coordinate the introduction of cleaner and more sustainable aviation fuel in the market. It additionally outlines executive actions that the Administration believes will result in the production and use of billions of gallons of low-carbon aviation fuel, which is intended to reduce aviation emissions by 20 percent by 2030.

I.  Future of sustainable fuels in American aviation

According to the fact sheet, commercial aviation accounts for 11 percent of US transportation-related greenhouse gas (GHG) emissions, and the new initiative identifies a slate of near-term proposals to achieve reductions in aviation-related emissions.  The most significant and concrete actions are designed to substantially expand sustainable aviation fuel (SAF) production to at least 3 billion gallons per year by 2030.  However, the initiative also lays the groundwork for the Biden Administration’s long-term strategy to achieve net-zero GHG emissions from the aviation sector.  To that end, the White House also plans to “release an ‘aviation climate action plan’ in the coming months, which will set forth a comprehensive plan for aviation.”

The fact sheet released on September 9 identifies the steps that the Administration is taking to coordinate the federal government, aircraft manufacturers, airlines, fuel producers, airports and non-governmental organizations to support the use of cleaner and more sustainable fuels in American aviation.   Primary components of the initiative include:

  • SAF tax credit: Establish a SAF tax credit as part of the President’s Build Back Better Agenda.  The proposed tax credit is currently under consideration by the House Committee on Ways & Means and would require qualifying SAF to achieve at least 50-percent reduction in lifecycle GHG emissions.  The proposal would provide a credit of $1.25 per gallon of SAF blended with traditional jet fuel, with additional incentives for those SAF pathways with greater reductions in lifecycle GHG emissions.  The new credit would replace the existing incentives for SAF under the biodiesel mixture tax credit.
  • SAF grant challenge:  The US Department of Energy (DOE), US Department of Transportation (DOT) and the US Department of Agriculture (USDA) will initiate a government-wide grant challenge focused on research and development and demonstration projects for new SAF pathways that achieve a minimum 50-percent reduction in lifecycle GHG emissions.  The challenge will set very ambitious goals of supplying at least 3 billion gallons of SAF per year by 2030 and meeting 100 percent of aviation fuel demand with SAF by 2050 (projected to be 35 billion gallons per year).
  • Renewable Fuel Standard pathway approvals: The Environmental Protection Agency (EPA) and DOE will collaborate and assess technical information and take steps needed to expedite the regulatory approval process to support newly developed feedstocks that may be used to produce SAF.  Pathway approval under the Renewable Fuel Standard confers the authority for renewable fuel producers to generate valuable compliance credits known as renewable identification numbers (RINs) – SAF will generally qualify for D4 or D5 RINs.
  • FAA support for SAF certification and approval: The Federal Aviation Administration (FAA) will make grant awards to the Aviation Sustainability Center (ASCENT) to provide support for the evaluation and testing that is required before new SAF pathways are approved and certified for use.
  • DOE grants and support: The DOE will offer grants and loan guarantees for development of commercial-scale SAF projects and provide funding and other technical support for certification of new SAF pathways pursuant to the American Society for Testing and Materials (ASTM) approval process.
  • Sustainable Flight National Partnership: As part of this initiative, the National Aeronautics and Space Administration (NASA) launched the Sustainable Flight National Partnership in June 2021 to collaborate with the FAA and industry to accelerate the maturation of aircraft and engine technologies that enable reductions in fuel burn and carbon dioxide emissions.
  • Air traffic and airport efficiency: The FAA will award grant funding and support other initiatives aimed at reducing emissions, improving air quality and local environmental impacts (including lead emissions) and other efficiency improvements at airports.
  • Industry commitments:  The fact sheet also states that a number of commercial and cargo airlines and fuel manufacturers have made commitments to work with the federal government and other stakeholders to accelerate the production, deployment and use of SAF to replace conventional jet fuel.
  • International leadership: The Administration is also committed to establishing the US as an international leader on sustainable aviation and climate change, including through ambitious domestic climate initiatives.

II.  Outlook

As with other renewable fuels, SAF achieves potentially significant reductions in lifecycle GHG emissions compared to petroleum-based jet fuel.  However, because of the unique risks associated with aviation safety, new SAF pathways must undergo a rigorous approval process in which the fuel producer, aircraft and engine manufacturers, the FAA and the ASTM must evaluate and approve the SAF specifications in accordance with the relevant ASTM standards and procedures.  This approval process is designed to verify important fuel safety and operability specifications that are unique to jet fuel.  As a result, the process can take several years to complete.

SAF that is approved through the ASTM process meets the performance, operability and infrastructure compatibility requirements of traditional jet fuel.  Therefore, approved SAF pathways qualify as “drop in fuels,” meaning they can be handled through existing distribution systems.  However, only very small volumes of SAF are currently produced in the US annually (approximately 4.5 million gallons per year), and availability is limited to airports located on the West Coast.   In addition, some scientists and environmental stakeholders are concerned that expanding SAF production will incentivize conversion of forests, wetlands and grasslands to SAF feedstock production, which would reduce the GHG emission benefits of SAF and result in other potential harm to wildlife and natural resources.

The White House SAF Plan demonstrates the Biden Administration’s commitment to support the development and use of SAF, and it will likely provide momentum for the development and commercialization of new SAF pathways.  A number of key components of the Administration’s program can be implemented under existing executive authority, such as expedited review of renewable pathway petitions by the EPA and the SAF Grant Challenge.  Other components, such as the SAF Tax Credit and certain funding proposals for research and development, require Congressional action.   This initiative is an important step forward, but the aviation sector will require years to meet the aggressive targets set by the Biden Administration.

If you have questions regarding the White House initiative, please contact any of the authors.