Sustainable Aviation Fuel just got a huge boost from the U.S. Treasury Department that could clear a major new corn ethanol market for take-off.
The Treasury Department’s new tax guidance could create a 36-billion-gallon market for Sustainable Aviation Fuel made with biofuels like corn ethanol.
Renewable Fuels Association head Geoff Cooper says the Treasury’s accepted a key modeling tool to measure carbon intensity and eligibility for a make-or-break tax credit.
“We were looking for the inclusion of the Department of Energy’s GREET model in this guidance, and we were happy to see that it is, in fact, listed as an approved methodology for doing that analysis,” says Cooper.
The news follows Virgin Atlantic’s first-ever 100 percent SAF trans-Atlantic test flight from London to New York. Cooper says Treasury must still work out the details, but he’s hopeful about revisions expected by next March.
“We are cautiously optimistic,” according to Cooper. “We’re hopeful that this guidance today is what will open the door to this opportunity for America’s ethanol producers, farmers, and airlines to jump into the aviation fuel marketplace.”
Cooper adds that SAF is a bulwark against a transition away from liquid fuels in the motor vehicle fleet.
“Demand for liquid fuels in light-duty transportation we do expect to be flat or declining over the long-term, as we do see greater fuel economy and more electrification in the light-duty fleet. So, we look at aviation as a potential huge new market opportunity.”
The National Corn Growers Association (NCGA) was pleased to hear the Treasury’s decision.
“Given that GREET was created by the government and is widely respected for its ability to measure reductions in greenhouse gas emissions from the farm to the plane, we’re encouraged by this,” says NCGA President Harold Wolle. “We’re eager to help the aviation industry reduce its carbon footprint and look forward to helping ensure the final model helps achieve that goal.”
Source: NAFB News Service.
