The Inflation Reduction Act, President Joe Biden's signature climate law, requires SAF producers to use an emissions model developed by the International Civil Aviation Organization , or a"similar methodology", to show their fuel cuts emissions over gasoline by 50 per cent to secure the subsidies.
The ethanol industry believes the GREET model is more likely than the ICAO model to bear out the required climate benefits to secure IRA subsidies. "With the right market signals, we can de-carbonise aviation and spur a new wave of US innovation and clean energy jobs. However, modeling uncertainty today is a multiyear development problem," said the letter, which was also signed by ethanol companies including Poet and Archer-Daniels-Midland Co.
The final decision on the modelling question sits with Treasury, though the agriculture, environment and energy departments have also weighed in and the White House has stepped in to mediate, according to prior Reuters reporting.