Government pushes for sustainable aviation: tax credits on SAF

The United States Senate has passed the $430 billion Inflation Reduction Act that may provide a tailwind in the U.S. for sustainable aviation. The bill offers important incentives to lower airline emissions by 20 percent over the next eight years.

The bill addresses climate change, rising healthcare costs and reducing the national deficit. It also offers some heavy incentives on the research, development, and production of sustainable aviation fuel (SAF). The incentives include a tax credit of up to $1.75 per gallon for airlines that continue to switch over to SAF.

Flying on SAF is one the ways that airlines have identified as an important way to reduce their carbon footprint. The Washington Post called the tax credit in the Inflation Reduction Act a "less-noticed-but-significant provision that extends tax credits for biodiesel, and includes incentives for sustainable aviation fuel to reduce the airline industry’s emissions."