WASHINGTON, D.C.—In a comment letter submitted today to the Internal Revenue Service (IRS), Growth Energy—the nation’s leading biofuels trade association—urged the agency to rely on the most accurate and up-to-date lifecycle analysis (LCA) approaches in order to make the most of the 40B and 45Z tax credits in the Inflation Reduction Act (IRA), and to help the U.S. become the global leader in the production of sustainable aviation fuel (SAF).

Growth Energy sent the letter in response to the IRS’s call for public comment on its implementation of the IRA’s 40B Sustainable Aviation Fuel Tax Credit and the 45Z Clean Fuel Production Tax Credit. This is the third time Growth Energy has submitted comments to the IRS on these incentives, and the third time it has reiterated to the agency how important it is that the most thorough, accurate science be used to determine which producers are eligible for the tax credits and how much they can claim.

“Specifically, the IRS must allow ethanol-to-jet fuel producers to use the U.S. Department of Energy’s Greenhouse Gases, Regulated Emissions, and Energy Use in Technologies (GREET) model in determining the fuel’s lifecycle GHG emissions,” the letter said. “Further, the IRS’s implementation of the 40B and 45Z tax credits must rely on accurate and complete GHG lifecycle emissions accounting to determine credit eligibility.”

Many Growth Energy member companies have already made substantial investments in SAF production, and in its letter the association noted that it views “U.S. leadership in the global SAF market to be vital to the decarbonization and future economic competitiveness of the U.S. aviation sector.”

Relying on the GREET model and the most comprehensive LCA accounting methods would “incentivize further GHG emissions reductions and further the IRA’s goals,” Growth Energy CEO Emily Skor wrote to Treasury in November 2022. “Any other approach, such as GHG emissions values that do not account for the array of potential GHG-reduction strategies, would fail to incentivize further reductions and accordingly frustrate the purpose of these tax credits.”

Read Growth Energy’s most recent letter here, and its letters from November and December of last year here and here, respectively. A study titled “GHG Analysis of Dry Mill for Corn Ethanol Production under IRA” commissioned by Growth Energy can also be found here.

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