Climate bill dissolution threatens green aviation fuel liftoff

Last week’s collapse of US climate legislation could severely hamper the development of clean-burning transportation fuels, investors, lobbyists and analysts said. The US biofuel industry was banking on legislation that would boost investment in fuels like sustainable aviation fuel (SAF), made from animal fats, greases and oils, and produces fewer carbon emissions than traditional jet fuel. US fuel makers have been increasing output of cleaner-burning fuels for industries that are harder to electrify. Renewable diesel production is profitable due to state and federal financial incentives, but SAF is two to five times more expensive than jet fuel. Last week, US Senator Joe Manchin, a conservative Democrat from West Virginia, indicated he would not vote for a slimmed-down climate spending bill, effectively dooming legislation that has been through multiple iterations and would have included incentives to increase investment in SAF and other low-carbon transportation fuels. “Companies that are already today producing SAF along with those producing road transportation fuels rely on this policy. ... If it lapses, we’ll lose the momentum that our industry has built to support the emergence of SAF,” said Paul Winters, a spokesman for the Clean Fuels Alliance, an industry group composed of biofuel producers. The White House wants to lower aviation emissions by 20% by 2030, with a goal of boosting SAF production to 3b gallons per year by 2030, and to meet 100% of aviation fuel demand of about 35b gallons a year by 2050. Only around 33m gallons of SAF were produced last year globally, or 0.5% of the jet fuel pool. The original $1.7t Build Back Better proposal contained tax credits for SAF of between $1.25 to $1.75 a gallon, depending on the feedstock used, which would lower production costs for biofuels producers.<br/>