New Momentum on Capitol Hill
Bipartisan members of both chambers have introduced companion bills designed to turbocharge the growth of sustainable aviation fuel (SAF) across the United States. The first proposal would raise the existing blender credit to a maximum of two dollars per gallon for high performance SAF while locking in the incentive through 2032. The second proposal focuses on regulatory efficiency, directing the Federal Aviation Administration to publish updated certification pathways that recognise drop in SAF blends up to fifty per cent without individual supplemental type certificates.
Non-obvious Insight: Credit Duration Matters More Than Size
Many headlines concentrate on the per gallon value, yet institutional investors often weight certainty over magnitude. Extending the credit for five additional years allows project finance models to assume full debt repayment during the credit window, lowering the weighted average cost of capital by several percentage points. That reduction can be more powerful for plant economics than a small bump in headline credit value.
Simplifying Certification
Under the current framework each new SAF blend may require separate fuel property testing and engine validation, a process that can stretch to eighteen months. The proposed Aviation Certification and Standards Modernisation Act instructs the FAA to adopt a performance based approach using pooled data, enabling approvals in as little as six months. By shortening the validation cycle, engine manufacturers can synchronise software updates with airline maintenance checks, avoiding unscheduled downtime.
Alignment with State Programs
Several states, including California and Washington, already offer low carbon fuel incentives at the pump. The federal credit would layer on top of those programs, creating a stackable benefit that can bring SAF parity with conventional jet fuel on certain routes. That convergence encourages airlines to sign long duration offtake contracts, giving producers revenue certainty.
Conclusion
With financial carrots and procedural clarity moving together, the new legislative package could unlock previously stalled projects and place the United States on a clear flight path toward meaningful SAF market share growth.