Introduction
The Biden administration is set to acknowledge a revised methodology backed by the ethanol industry in its guidance on accessing credits for sustainable aviation fuel (SAF) production, according to sources familiar with the matter. The move has come after months of internal debate within the administration over whether to adopt the Department of Energy’s Greenhouse Gases, Regulated Emissions and Energy Use in Technologies (GREET) model.
The GREET model would allow ethanol-based SAF to qualify for tax credits under President Joe Biden’s climate legislation, the Inflation Reduction Act. This development marks a significant win for the ethanol industry, which has been at odds with environmental groups advocating for higher standards favoring feedstocks like used cooking oil and animal fat.
Additionally, the administration intends to announce updates to the GREET methodology by March 1, as per the sources.
Ethanol Industry’s Victory
The recognition of the GREET model by the Biden administration is a significant triumph for the ethanol industry. Ethanol-based SAF would now be eligible for tax credits, enabling the industry to further establish itself as a viable player in the sustainable aviation fuel sector. The industry has been competing against environmental groups who argue in favor of stricter standards, emphasizing the usage of feedstocks such as used cooking oil and animal fat. The administration’s decision clearly favors ethanol, highlighting the importance of the industry’s role in reducing emissions related to aviation fuel.
GREET Methodology Update
Aside from acknowledging the GREET model, the Biden administration also plans to update the methodology. The exact details of the update remain undisclosed; however, sources have revealed that the administration intends to make the update by March 1. The motivation behind the update is to ensure that emissions from SAF production are at least 50% lower than emissions from traditional oil-based aviation fuel. By making this commitment, the administration aims to solidify the environmental credibility of ethanol-based SAF and promote its adoption as an effective tool in combating climate change.