The Center for Climate and Energy Solutions (C2ES) is actively supporting the development and adoption of sustainable aviation fuel (SAF) as part of our efforts to accelerate the net-zero transition.
The Center for Climate and Energy Solutions (C2ES) is actively supporting the development and adoption of sustainable aviation fuel (SAF) as part of our efforts to accelerate the net-zero transition.
Sustainable aviation fuel is an umbrella term for jet fuels that are not petroleum-based, can be blended with conventional jet fuel, and can be used in today’s aircraft. Once SAF is blended with jet fuel, it becomes part of the jet fuel mix and is no longer differentiated from conventional jet fuel; it can be transported on the same pipelines, fuel tanker trucks, and rail cars as conventional jet fuel.
Through our Washington roundtable sessions and subsequent discussions with participants, several recommendations for U.S. Congress emerged to address areas of high need for scaling the SAF industry. The areas of need include: unlocking private investment in SAF production; supporting the buildout of SAF infrastructure; accelerating SAF utilization; and encouraging equitable workforce development in the SAF industry.
The Inflation Reduction Act’s (IRA) two new SAF tax credits, 40B and 45Z, are designed to increase SAF’s competitiveness and spur new production, but the duration of the tax credits—which expire at the end of 2024 and 2027, respectively—does not align with the time needed to bring new production online (approximately 5 to 7 years). Extending the eligibility period of SAF tax credits to 10 years following the date a facility is placed into service would provide the economic certainty needed for investments in new capital-intensive SAF facilities. The extension would also align SAF credits with the duration afforded to other tax credits created by the IRA, including the 45V Clean Hydrogen Production Tax Credit.
The SAF Grand Challenge estimates that $30 billion dollars of capital investment is needed to build out the production and delivery infrastructure to meet the U.S. goal of producing 3 billion gallons of SAF domestically by 2030. Meeting the U.S. goal to provide 100 percent of the aviation fuel demand with SAF by 2050, estimated to be 35 billion gallons, will require hundreds of billions of dollars in capital investment. The FAST-SAF grant program, created by the IRA section 40007, aims to unlock capital for investments in large-scale SAF infrastructure projects. But the one-time, $244.5 million program will not be able to catalyze the scale of private capital needed to accelerate the nascent industry.
Under federal law, there are strict regulations on permitted and prohibited uses of revenue generated from any airport that receives federal assistance. While direct procurement of SAF and offsite infrastructure investments are not explicitly prohibited, there is a risk that they could be considered revenue diversion. The most recent amendments to the FAA’s Policy and Procedures Concerning Use of Airport Revenue were published in 2014, predating commercially available SAF in the United States. It is important to clarify the resources available to U.S. airports, should they determine it is in their best interest to become more active stakeholders in the development of the domestic SAF market.
The FAST-SAF notice of funding opportunity mentions workforce opportunity as a key criterion for application evaluation in second-level review and is an example of the type of considerations that should be made to encourage equitable workforce development. This includes the use of demonstrated strong labor standards, practices, and policies; safety and health standards; the use of Local Hire Provisions; and registered apprenticeships. These conditions of positive workforce development should be considered for all federal SAF-related funding applications and expanded to include access to wraparound services, such as access to transportation to work and childcare during work hours.
Our factsheet provides background on SAF in Washington state policy and key federal policy recommendations based on our 2024 Roundtable. The Roundtable considered how federal policy solutions could support the development of the SAF industry in the region, convening nearly 40 local stakeholders through facilitated, small-group discussions designed to develop actionable federal policy solutions that supplement state-level support for SAF.
Read FactsheetWashington state has demonstrated leadership in bringing together stakeholders across the aviation industry to study, plan, and address the barriers to scaling the production of sustainable aviation fuels within the state. Building on insights from more than a decade of state-level progress, this brief offers recommendations to federal policymakers to scale sustainable aviation fuel developed in a C2ES roundtable convening.
Read the BriefIn this blog post, Associate Policy Fellow Peter Trousdale explored the growing sustainable aviation fuel industry in Washington state, and the federal policy needs that emerged from our Regional Roundtable in Seattle.
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