House Passes Bill That Includes SAF Tax Credit

If ‘Build Back Better’ is passed, users of sustainable aviation fuel could receive up to $1.75 per gallon.

Ashley Barajas

Friday, November 19, 2021 at 05:46 PM ET

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To receive the credit, the operator must use a fuel that’s part of a qualified fuel mixture. Credit: Adobe Stock

Key Takeaways:

A bill passed by the U.S. House includes a new tax credit for Sustainable Aviation Fuel (SAF), a provision strongly supported by the National Business Aviation Association (NBAA).
The SAF tax credit offers $1.25 per gallon for fuels demonstrating at least a 50% lifecycle greenhouse gas reduction, with potential to increase up to $1.75 per gallon for higher reductions, effective after December 31, 2022.
The legislation also allocates significant funding for SAF initiatives, including $300 million to the Department of Transportation for development projects and $225 million to NASA for sustainable aviation research.

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A bill that recently passed the U.S. House as part of its Build Back Better legislation contains a clause backing a tax credit for sustainable aviation fuel (SAF). This tax credit has been strongly advocated for by the National Business Aviation Association (NBAA).

NBAA’s president and CEO Ed Bolen expressed his support for the passage. “The House passage of this blenders tax credit recognizes SAF’s potential to greatly reduce the aviation industry’s near-term GHG emissions, and validates NBAA’s repeated calls to incentivize the production of this drop-in fuel to attract more producers and make SAF more accessible to business aviation users.”