Biden admin split over ethanol's role in aviation fuel subsidy program

The Biden administration is divided over whether to grant a request from the US biofuel industry that would make it easier for sustainable aviation fuel made from corn-based ethanol to qualify for subsidies under the White House's signature climate law, according to two sources familiar with the discussions. The indecision has touched off a lobbying battle between two big stakeholders - Farm Belt backers who view sustainable aviation fuel (SAF) as crucial to ethanol's growth and environmental advocates who say clearing land to grow crops for fuel is counterproductive to solving global warming. At issue is a requirement in last year's Inflation Reduction Act that SAF producers seeking tax credits must demonstrate with an approved scientific model that their fuel generates 50% less greenhouse gas emissions over its lifecycle than petroleum fuel. Midwest ethanol producers have asked the administration to adopt a model that would enable ethanol-based SAF to qualify while environmentalists want standards that would favor inputs like used cooking oil and animal fat. Officials at the Environmental Protection Agency and agriculture and energy departments are divided over which model to use, and White House Climate Czar John Podesta is seeking to resolve the question, according to the sources. A White House official said the administration’s SAF policy seeks to include ethanol, but “we are trying to seek alignment with stakeholders on the question of modeling.” The EPA, Department of Agriculture and Department of Energy did not respond to requests for comment.<br/>