The market for producing jet fuel from ethanol has received a boost in the US with the recently released guidance on sustainable aviation fuel (SAF) tax credit under the Inflation Reduction Act.
The Treasury Department’s guidance provides clarity around eligibility for the SAF credit of USD 1.25 to USD 1.75 per gallon, allowing the use of the Department of Energy’s Greenhouse Gases, Regulated Emissions, and Energy Use in Technologies (GREET). A soon-to-be-updated version of this model will be among the methodologies used to determine eligibility.
The American Coalition for Ethanol (ACE) said the decision clears the runway for ethanol-to-jet.
“Treasury’s decision will enable corn ethanol to emerge as a significant SAF feedstock in the years to come and fulfil President Biden’s pledge that farmers would be providing 95 percent of SAF in the next 20 years,” commented ACE chief executive Brian Jennings.
Renewable Fuels Association President and CEO Geoff Cooper said that grain-based ethanol stands out as the most abundant and cost-competitive source for large-scale SAF production.
The SAF credit encourages the production of SAF that achieves a lifecycle greenhouse gas emissions reduction of at least 50% compared to petroleum-based jet fuel.