Sustainable Aviation Fuel Under the Inflation Reduction Act: Incentives and Opportunities

Sustainable aviation fuel (SAF) is viewed as a safe, reliable, and low carbon alternative to conventional jet fuel and is expected to emerge as a key element of the energy transition, particularly in light of new federal income tax credits for SAF under the Inflation Reduction Act of 2022 (IRA).

This presentation will begin with an overview of SAF, including certain key technical, commercial, and market considerations, and then will discuss the new tax incentives for SAF under the IRA, including the SAF credit under Section 40B of the Internal Revenue Code of 1986, as amended (the Code) and the clean fuels production credit under Section 45Z of the Code.

Steven Lorch and other speakers will discuss certain limitations on the ability of taxpayers to claim multiple types of federal income tax credits with respect to the same SAF project or facility (that is, the so-called “anti-stacking” rules). They will also discuss various strategies that renewable fuels developers and investors are employing in order to claim the federal income tax credits available for SAF under the IRA, including opportunities to monetize these credits.