A coalition of 15 aviation stakeholders is urging U.S. congressional leaders to enhance tax incentives for sustainable aviation fuel (SAF). In letters to Senate Majority Leader John Thune (R-South Dakota) and House Speaker Mike Johnson (R-Louisiana), the stakeholders called temporary SAF and Clean Fuel Production tax credits provided under the Inflation Reduction Act as welcomed incentives. But they added, “It is critical to improve and enhance the SAF incentives to ensure the United States does not cede ground to other countries in this emerging market.”

In a joint letter last week, the groups urged lawmakers to extend the duration of the Clean Fuel Production credits to at least 10 years to provide market certainty and reduce risk on investment in SAF projections. “Without a change, the existing three-year duration is insufficient to attract and sustain the investment needed to dramatically increase U.S. SAF production and create more American jobs,” the stakeholders wrote.

Also, the groups urged a higher incentive value for SAF to “ensure a level playing field…relative to other fuels.” Asking for a minimum credit of $1.25 per gallon for SAF, the groups said additional incentives are necessary to attract investment. The $1.25 would bring the Clean Fuel Production credit in line with the SAF credit, which expired last year.

Taking effect this year, the Clean Fuel Production tax credit floor is $0.35 per gallon for SAF for facilities that do not meet wage and apprenticeship requirements, escalating to $1.75 per gallon for those that do.

“We emphasize the important opportunity here to fix their limitations and put in place a well-tailored incentive that will drive domestic energy production, stimulate rural economic development, and reinforce America’s energy and technological dominance relative to China, Brazil, and other regions,” wrote the groups, which represented a broad swath of airlines, airports, business and general aviation, manufacturers, business travel, and SAF interests, among others.

The organizations sent the letter as the Biden Administration has been preparing guidance on the Clean Fuels Production Credit (section 45Z).