AFCC: Biden Administration need to provide at least $20B in immediate new federal loan guarantee authority for SAF manufacturers

In Washington,  The Alternative Fuels & Chemicals Coalition and its members are asking the Biden Administration to incentivize the production and use of sustainable aviation fuels (SAF). Citing sharply enhanced global SAF targets, the group said:

“To approach these projected significantly increasing SAF volumes, the White House, in conjunction with the Department of Energy (DOE), needs to target providing at least $20 billion in immediate new federal loan guarantee authority from Congress for SAF manufacturers through the DOE’s Loan Program Office. This funding would spawn new supply chains of SAF by increasing the development of substantially more SAF manufacturing facilities in the U.S., as additional low-carbon SAF technology continues.

By increasing the production volume from cheap feedstocks such as forest residuals and other biomass wastes, SAF manufacturers would lower the cost of producing their SAF and, thus, make it more competitive with conventional petroleum A1 Jet Fuel. In order to increase commercial volumes of SAF and to meet the linear growth forecasted by the International Civil Aviation Organization (ICAO), a complete replacement of conventional petroleum jet fuel would require approximately 170 new large biorefineries to be built every year from now to 2050 states ICAO in its 2020 jet fuel report.

Furthermore, by 2030, LanzaTech projects in a recent analysis that mandated SAF demand will be far higher than 50 billion gallons per year, thus requiring new technologies and expanded feedstock pool.

This opportunity fits within President Biden’s whole-of-government approach position for America to lead a clean energy revolution and create thousands of jobs across the country. President Biden’s Administration signaled its approval for a new blenders tax credit for SAF in its tax plan, “The Made in America Tax Plan” and is in line with the AFCC’s top policy priorities for 2021. As exciting as this new SAF incentive may be, the AFCC and its member companies encourage the Administration to further promote the growth of SAF through federal loan guarantees. This recommended action would support airlines which are in significant need of large volumes of green fuel that is cheaper and more widely available to decarbonize 12% of transportation’s carbon dioxide emissions globally. This result would contribute substantially towards a necessary global net-zero solution.