Congress Navigates a Steep Climb for Greener Flights

Bipartisan bills aim to reverse 2025 cuts to aviation fuel tax credits, extending vital production incentives through 2033 to boost domestic output

5 Feb 2026

A bipartisan coalition in Congress has moved to reinstate the maximum tax incentive for sustainable aviation fuel (SAF), reversing a policy shift that industry leaders claim slowed the sector’s growth. The Securing America's Fuels Act aims to restore the value of the 45Z Clean Fuel Production Credit to its original levels after a 2025 legislative change reduced the available support.

The 2025 One Big Beautiful Bill Act had extended the 45Z credit through 2029 but eliminated a specific bonus for SAF. This change lowered the maximum subsidy from $1.75 per gallon to $1.00 per gallon. The new proposal would not only bring back the higher rate but also extend the entire incentive framework until 2033.

The legislative move follows warnings from trade groups that the lower credit hampered the financial viability of new refineries. These facilities are essential to meeting the federal target of 3bn gallons of SAF production annually by 2030.

The House of Representatives introduced its version of the bill in late 2025, followed by a Senate companion in February 2026. The legislation has gained support from a broad range of agricultural and transport interests. Delta Air Lines described the measures as critical to bringing more production facilities online to meet growing demand.

At the heart of the debate is whether energy policy should remain technology neutral or offer targeted support for harder to abate sectors like aviation. SAF can reduce lifecycle carbon emissions by up to 80 per cent compared to traditional jet fuel, but production costs remain significantly higher.

For fuel producers and airlines, the extension to 2033 provides a more predictable investment horizon. Many companies have already begun reassessing their capital commitments based on the shifting subsidy landscape.

The path forward for the bill depends on its ability to maintain bipartisan momentum in a divided legislature. Producers are now looking to Washington for a definitive signal on whether the US will commit to a dedicated financial framework for aviation decarbonisation.