Inflation Reduction Act Provides Tax Credits on Sustainable Airline Fuel
The US Senate on Sunday passed the $430 billion Inflation Reduction Act. The bill could be one of the most significant climate-centric bills ever proposed and it affects aviation among many other areas.
The bill heavily incentivizes the research, development, and production of sustainable aviation fuel (SAF). It includes a tax credit of up to $1.75 per gallon for airlines that continue to switch over to SAF. This is part on an overall plan to lower airline emissions by 20% over the next eight years.
Many airlines, including the largest domestic carriers such as American, United and Delta, have already been looking for ways to reduce their carbon footprint. Aviation accounts for 3% of the world’s carbon emissions, but it presents a challenge to cut emissions due to a lack of alternative technologies.
According to Reuters, U.S. fuel retailers lobbied the administration hard prior to the bill being passed to remove the tax credit incentive being offered to green fuel alternative suppliers. Opponents of the bill said SAF is more carbon-intense and less efficient.
“SAF cannot compete with other renewable fuels on an environmental basis,” David Fialkov, executive vice president of government affairs at National Association of Truckstop Operators (NATSO).
Other environmental advocates have argued that all biofuels that divert lipid-based feedstocks such as animal fats and waste cooking oils from existing markets present significant sustainability concerns, Reuters reports.
“Increasing the global supply of vegetable oils, directly or indirectly, necessarily comes at the cost of forests and other natural lands,” according to researchers at the International Council on Clean Transportation in an August briefing.
Lower Spend - Chase Ink Business Preferred® 100K!
Chase Ink Business Preferred® is a powerful card that earns 3X Ultimate Rewards points in a broad range of business categories on the first $150K in spend per year. Right now earn 100K Chase Ultimate Rewards points after Learn more about this card and its features!
Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
[…] Inflation Reduction Act Provides Tax Credits on Sustainable Airline Fuel […]
Great naming strategy by the Dems. Although it won’t do anything in the near term to live up to the name, they can take credit for the Fed tightening strategy. Brilliant move!