U.S. admin sets path for ethanol aviation fuel subsidies

The Biden administration (U.S.) has unveiled guidance for its sustainable aviation fuel (SAF) subsidy program, allowing corn-based ethanol to qualify if sourced from farms using climate-friendly techniques. The SAF subsidies amount to $1.25 per gallon for fuels that hit the 50% emissions reduction threshold, and up to $1.75 per gallon for those that exceed it.

While a boost for the ethanol industry, some had hoped for lower hurdles. SAF aims to reduce air travel carbon emissions, accounting for 2% of U.S. pollution. The plan supports rural economies and aligns with Biden's clean energy goals.

SAF subsidies require fuels to be 50% lower in emissions than petroleum jet fuel. The plan includes recognition of climate-smart agriculture practices. However, concerns remain about the efficacy of SAF in achieving significant climate gains.